Companies in the architectural design industry face a mounting array of pressures to reduce operating costs while simultaneously expanding their scope of business and increasing revenue. These mounting pressures have contributed to the rapid growth of outsourced engineering services as an affordable means of accomplishing all three of these goals. Below is a look at the continued rise in outsourced engineering services and the many ways that this practice benefits a business.
The Rapid Rise of Outsourced Engineering Services
Businesses across the globe are increasingly outsourcing their engineering services to countries such as India, the Philippines, China, and Russia. Higher domestic labor costs and the desire to increase profits within industrialized nations have contributed to the continued rise in outsourced engineering services. Researchers estimate that the total amount of money spent on outsourced engineering services will keep growing at a rate of 3-4 times the rate of total spending on engineering. Total outsourcing revenue is also expected to rise with the total amount of money spent on outsourcing projected to reach $225 billion by the year 2020.
Key Benefits of Outsourcing Your Engineering Services
The key driver behind the rise in outsourced engineering services is an increased understanding of the benefits that accompany the outsourcing process. By choosing a trusted outsourcing provider, businesses can enjoy benefits such as reduced operating costs, improved design quality, increased technical support, and higher client satisfaction. Below are twelve primary benefits of outsourcing your engineering services.
1) A significant reduction in overhead expenses. Market research indicates that outsourcing engineering services enables companies to reduce labor costs by 20% to 30% while simultaneously reducing the amount of revenue spent on engineering-related services. The money saved can be applied to new business development, marketing initiatives, and other key expenses.
2) The use of the most sophisticated technology. Outsourcing firms focus exclusively on engineering services and therefore tend to use the most recent, cutting-edge technology. They are focused on innovation and are aware of the competitive advantages that accompany technological expertise.
3) Ability to devote time and resources to growth. One of the primary reasons to consider outsourcing is to free up time to devote to other critical tasks. Company executives can use this time to concentrate efforts on growth, new product development, and quality improvement.
4) Less office space is required. A major advantage of outsourcing engineering services is the reduction in the amount of office space that you will require. With in-house engineering staff requiring roughly 150 square feet per employee, companies can save 300 to 600 square feet by outsourcing the services performed by 2-4 in-house engineers.
5) Access to a comprehensive array of complex engineering services. Customers are increasingly demanding more complex engineering services that are sometimes beyond the scope of a small business with limited in-house engineering resources. Outsourced providers are accustomed to showcasing projects with highly complex geometries and those that require sophisticated 3D animation services that are not strong points for companies with limited resources.
6) Office equipment costs are reduced. When engineering services are outsourced, you enjoy immediate savings on expenses related to furniture, computers, printers, telephones and office supplies. With businesses spending an average of $2,000 per year on office equipment and supplies for every employee, a small business can enjoy significant savings on office equipment through outsourcing.
7) A faster turnaround time on key projects. Speed is a critical concern voiced by customers who require engineering services. Approximately 23% of companies choose to outsource because they seek a faster turnaround time. With outsourcing companies often working around the clock to complete projects, companies are able to meet their customers’ demands much faster than they could with a limited number of in-house engineers.
8) A higher level of engineering expertise. Outsourcing engineering services offers companies a higher average degree of technical expertise. The best outsourced providers have highly trained teams of engineers and architects who are well-versed on industry best practices. In-house training programs and continuing education are part of the workplace culture, and highly complex projects can be tackled more efficiently.
9) Ability to use services on an as-needed basis. The demand for engineering services is not constant. Fluctuations in demands for services can present a challenge to a company, especially if the business is smaller in size. Bottlenecks can arise in periods of high demand while engineering staff continue to receive full-time pay even during industry lulls. Outsourcing solves this problem through flexibility, as a company only pays for services that are rendered.
10) Access to service and support at all times. One of the greatest benefits of outsourcing is the 24/7 access to client support services. Outsourced engineering providers typically offer ongoing support to clients regardless of the time of day. This enables customers located in different time zones to receive support that would usually have to wait until the next business day if in-house engineers are used.
11) Improved marketing capabilities. By outsourcing your engineering services to a trusted provider, your company is able to devote more time and resources on marketing initiatives. You can focus your efforts on showcasing your improved quality designs and developing new methods to promote your business, especially within emerging markets.
12) Higher client satisfaction. Clients demand high quality results and fast turnaround times. By outsourcing engineering services, you can meet both of these demands. The end result is a more satisfied customer who is more likely to request your services in the future. The key to maintaining a high level of customer satisfaction through outsourcing is to carefully choose an experienced, well-focused provider
Anticipating Concerns from Companies New to the Outsourcing Process
While there is clearly a plethora of benefits associated with outsourcing, not every organization is ready to embrace the possibility of outsourcing their engineering services. Outsourcing firms should be ready to overcome several key objections that are commonplace among businesses that are unfamiliar with outsourcing. The three most common objections are as follows:
- Reluctance to trust an overseas provider
- Worries about lack of control over project completion time
- Concerns about the quality of engineering designs
When evaluating potential outsourcing companies to manage your engineering services, you should make sure that each potential provider is able to thoroughly address these concerns.
Selecting a Trusted Provider to Handle Your Engineering Services Needs
After you have decided to outsource your engineering services, you must select an experienced provider with a track record of outsourcing success. Because not all outsourced providers are equal in the quality of product and service they offer, it is critical to seek a provider that offers the following:
- A minimum of one decade of experience in outsourcing engineering services
- Expertise in multiple areas (CAD drafting, BIM, 3D animation, and visualization services)
- A comprehensive portfolio of successfully completed projects
- 24/7 access to support services
- A focus on meeting critical deadlines
- An impressive collection of references, including some in your geographic area
- Use of the most recent technologies and visualization tools
The outsourcing specialists with INDBIM are dedicated to providing your company with the highest level of service. We have established ourselves as a leader in the engineering industry through our proven commitment to exceeding our clients’ needs for quality and fast turnaround time. With over 15 years of experience in outsourced engineering experience, we have the expertise required to successfully manage your most complex projects. We look forward to handling all of your engineering service needs.