Mastering Engineering Service Outsourcing in the automotive industry

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Market study
B. Engineering Service Providers should continously expand their domain
expertise
1. The increasing standardization of non-core components and basic
technologies opens a huge window of opportunity for ESPs to support
automotive manufacturers in mastering the challenges resulting from
increasing complexity and the multitude of vehicle variants. They can
establish a clear competitive advantage over other market players by
fostering cutting-edge technological know-how generation in dedicated
domains requested by OEMs.
2. Furthermore, ESPs need to define a clear and comprehensive value proposition
for automotive OEMs/suppliers and a go-to-market strategy
based on proven domain expertise. Just claiming end-to-end vehicle
competency with no clear domain specialization is not perceived as
compelling by most OEMs – in fact, they tend to regard it with suspicion.
A proven track record in a specific automotive domain is key
for winning long-term business contracts for outsourced engineering.
3. By offering OEMs competencies in a comprehensive and standardized
business model, Engineering Service Providers can offer existing and
future customers an easy-to-use service platform. The aim should always
be to reduce customers' control and governance efforts by providing
easy-to-use and transparent management interfaces for key performance
metrics (costs, timing, resources).
4. As well as their clients, ESPs have to define their own global R&D
footprint to best serve the increasingly global demand for engineering
services.
5. According to our market survey, both OEMs and OESs stress the role
of an accessible and responsive front office in close proximity to OEMs
as a prerequisite for engaging in long-term business relations.
6. To address the intrinsic fear of intellectual property misuse and piracy,
all Engineering Service Providers must establish and demonstrate a solid
compliance policy. This policy must be applicable to everyday business
and should incorporate high confidentiality and proprietary customer
know-how.