EFFICIENT ENGINEERING

Engineering efficiency is one of the most difficult performance indicators to

measure, since engineering costs are highly sensitive to success of the project.
Management always perceives reducing engineering costs as fairly risky. Risks include
too much business impact on delivery or lead time compared to gains, bad experiences
in outsourcing and insufficient resources in critical project phases, uncontrolled use
of external service providers, etc.

It is becoming crucial to improve engineering efficiency

In order to help growing workloads due to diversity and to manage scarcity of

experienced resources.
To cope with growing workloads due to concurrent development projects
For addressing global markets competitively.
Serving both mature and emerging markets with proliferating customer

demands,
Keeping pace with a rapidly growing technology base to improve product
functionality and costs,

While delivering all of that at the same or lower cost levels these are among the
major challenges for product / Project engineering.
However, current legacy engineering footprint is extremely difficult to change because
it deals with engineers and core competencies. Approach shall aim at defining the
most relevant engineering footprint for our Projects/ Product requirements.
Numerous improvement levers to be activated to remove inefficiencies in
engineering.

Among

these

are

improving

system

engineering

capabilities,

Implementing an efficient resource management approach.

Improving planning and utilization of testing shops
Making a step change in using 2D and 3D tools
Redefining core and non-core areas and partnership needs,

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and

synthesis

Reshaping supplier relationships into new collaborative models to reduce costs

along the full value chain.

Implementing rigorous engineering resource management systems etc

Collective effort is required to identity the appropriate levers to improve engineering

efficiency. A simple make-or-buy approach no longer works. Instead, we need to
rethink where focus own resources, and perhaps even more importantly, where not to
focus and where to partner with other companies.

Rigorous approach for Improving Engineering Efficiency helps in strategic positioning

in the competitive environment and provides support in redefining the product
creation value chain.
Our approach shall focus on pragmatic and geared toward significantly increasing
engineering efficiency without degrading competencies and output quality

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Key areas to address

Which product features contribute to market differentiation?

Which innovations/functions or (sub-) systems contribute most to desired

product features? What is the best way to attain a frontrunner position?

What kind of in-house performance structure is needed to tackle these

innovations?

In what areas is exclusive control over product or process know-how needed?

Where would leveraging economies of scale or scope improve the competitive
position?

What is the right level of internal resources, and where should the focus be?

What is the best way to integrate and collaborate with the best partners in
product creation?

Are there potential partners for whom we can define a win-win situation in a
collaboration scenario? What is the best way to approach them?

How do we ensure a stable cooperation?

How do we change the mindset in our own engineering department to overcome

the "not-invented-here syndrome"?

How can the footprint be defined as the good trade-off between cost efficiency,
quality (performance) of products and reactivity?

What is the best way to secure core knowledge and yet benefit from low-cost
operations?

What is the right way to ramp up implementation?

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How can the concrete benefits of a globalized footprint be measured?

What is the best way to manage classic cultural pitfalls?

Which processes and tools are required to support a globalization footprint?

What is the best way to safeguard intellectual property?

What is the best way to define and implement a lean engineering organization
(target structure, direct vs. indirect, etc.)?

What is the best way to speed up the development process (robust development,
program planning, de-bottlenecking, etc.)?

What is the best way to optimize validation means and costs (trials, prototyping,
simulation, etc.)?

How can a lean culture be defined and implemented within engineering teams?

Which engineering tools will enhance designer productivity?

How to better leverage engineering agencies? What are the outsourcing or low
cost opportunities?

Who are the strategic engineering agencies? How can they be characterized and
identified?

What are the new collaborative ways of working with targeted strategic
suppliers?

To which dimensions of the supplier relationship should this approach be

applied (innovation, development, production, economic models, etc.)?

What is the best way to enhance trust and transparency with strategic
suppliers?

How can this cultural change be supported internally?

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What operational impact will this have on processes (collocated teams, shared
drawings and tools, shared intellectual property, etc.)?

Relationships with key strategic suppliers throughout the development cycle:

earlier involvement in development, shared business commitments

Outcome shall be

Assessment of risks and opportunities of different options in the context of the

overall company strategy and long-term business model (markets, products,
projects requirement and technologies)

Redefinition of core/non-core areas in Product / Projects development and

reallocation of engineering budgets and headcounts

Clear partnering/cooperation strategy (with service providers and suppliers)

Target error elimination

Savings/benefits model and evaluation

Risk assessment

Efficiency improvement plan (typical savings: 15%-25% higher productivity,

20%-30% faster time-to-market)

Supplier segmentation; strategic supplier list

Mutual partnership agreements

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Implementation roadmap and support

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