Round the clock product development by effectively working globally - Eric van Essen

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Round the clock product development by
effectively working globally
- Eric van Essen

• Javelin Technologies has been serving Canadian
  customers since 1997

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Agenda

• Industry trends and market forces
• Company behaviour
• Country strengths and weaknesses
• Current findings and challenges
• Case studies
• Ways that Javelin and SolidWorks are helping
• Conclusions

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Quotes of the day

• "It is not the strongest of the species that
  survive, nor the most intelligent, but the one
  most responsive to change
  - Charles Darwin

• Innovation distinguishes between a leader and a
  follower
  - Steve Jobs
• Did You Know Video

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Industry Trends and Market Forces

• Providing 3D Design/Manufacturing software
  services since 1997

5
Some Industry Trends and Market Forces

• Stock market and CDN took a tumble
• Increased pressure on margins
• Time between order and shipping is shrinking
• Responsiveness to customer requests is
  increasingly more important

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Some Industry Trends and Market Forces

• Work coming in can be volatile
• Companies may be downsizing
• May be important to be able to fluctuate a work
  force
• Many countries are trying to shift to a larger
  knowledge based industry
• RD Tax incentives influence corporate decisions
• Foreign-based RD spending has grown faster than
  U.S.-based RD spending
• India offers 150 tax deduction for particular
  RD incurred costs

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Some Industry Trends and Market Forces

• Language issues are becoming easier
• English capabilities are continually increasing
  in foreign countries. India seams to be a leader
  in this area.
• Technological advancements making collaboration
  easier
• Internet speed is increasing
• Adoption of e-mail and other key communication is
  increasing
• Web sites for specific outsourcing functions are
  improving (ie. http//www.mfg.com )
• Software is evolving to meet demands and fill
  holes

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Company Behaviour

• Providing 3D Design/Manufacturing software
  services since 1997

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Major Justification Sources

• http//www.cenews.com/article.asp?id2254 -
  Offshore outsourcing A problem or a solution?
  Tuesday, July 31, 2007

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Top Justification

• Reducing Cost
• Workforce Capacity
• Workforce Size Flexibility
• Engineering Responsiveness

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What is being outsourced?

• Electronics and software is common
• Less skilled tasks such as drafting
• Mould Design
• Tool and Die work
• Other manufacturing related design work and
  modifications
• The trend is most pronounced in information
  technology, computing, and consumer electronics,
  where U.S., European, and Japanese firms have
  hired hundreds of thousands of programmers and
  engineers in China, India, and other developing
  nations.
• - A Shift In Engineering Offshoring, March 2009

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Who is working globally?

• Large multinational companies
• Apple, Bombardier, General Electric
• Medium companies seeking competitive advantages
• Small companies starting from the beginning
• Common term used is Micro-Multinational

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Countries

• Providing 3D Design/Manufacturing software
  services since 1997

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Where are companies commonly outsourcing

• South Africa
• Mexico
• Brazil
• Many European Countries

• China
• India
• Philippines
• Vietnam

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A Closer Look at China

• Strengths
• Labour pool size
• Labour costs
• High quantity driven approach
• Generally good material and energy prices
• Interesting Notes
• According to economists, China will become the
  world's wealthiest nation by the year 2012
• There are over 200 different Chinese dialects
• The United States has a 202 billion annual trade
  deficit with China
• China generates over 92 of the overall Canadian
  trade deficit with BRIC countries

• Weaknesses
• Containment of IP
• Language barrier can be an issue

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A Closer Look at India

• Strengths
• Good history in software development
• English language proficiency
• Government support and policies
• Strong tertiary education
• Process quality focus
• Skilled workforce
• Expertise in new technologies
• Reverse brain drain
• Existing long term relationships
• Indian domestic-market growth

http//www.nasscom.in/Nasscom/templates/NormalPage
.aspx?id6312
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A Closer Look at India

• Weaknesses
• Engineering graduates are not as skilled as North
  American graduates
• Average wages have been on a steep rise
• Interesting Notes
• same number of engineering graduates to United
  States

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Common Findings

• Providing 3D Design/Manufacturing software
  services since 1997

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Common Findings

• Benefits
• Saves money
• Increases capacity
• Greater workforce flexibility
• Faster project turnaround
• Allows for more focus on strengths
• Higher quality of work
• Easier technical time coverage
• Closer to potential manufacturing

http//www.cenews.com/article.asp?id2254 -
Offshore outsourcing A problem or a solution?
Tuesday, July 31, 2007
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Common Findings

• Challenges
• Communication errors
• Controlling quality
• Maintaining control
• Keeping IP close
• Cultural differences
• Fear of unknown
• Exchanging documents
• Extra time spent on management
• Finding correct work to outsource
• Costs associated with possible travel

http//www.cenews.com/article.asp?id2254 -
Offshore outsourcing A problem or a solution?
Tuesday, July 31, 2007 http//memagazine.asme.org/
articles/2009/March/Shift_Offshoring.cfm- A Shift
in Engineering Offshoring, March 2009 Javelin
Customer Testimonials
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Perception vs. Reality

• those that experience offshore outsourcing and
  those without experience have different
  perceptions of its benefits and drawbacks

http//www.cenews.com/article.asp?id2254 -
Offshore outsourcing A problem or a solution?
Tuesday, July 31, 2007
22
Perception vs. Reality for Benefits

• Reduced costs (66 vs. 81 )
• Allows staff to focus on more strategic issues
  (22 vs. 19 )
• Frees in-house staff from tasks outside of
  core-competencies (17 vs. 27 )
• More timely work (14 vs. 51)
• Reduces capacity constraints (7 vs. 24 )
• Higher quality work (2 vs. 11)
• Gains access to expertise/software/equipment not
  found in house (0 vs. 22)

http//www.cenews.com/article.asp?id2254 -
Offshore outsourcing A problem or a solution?
Tuesday, July 31, 2007
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Perception vs. Reality for Drawbacks

• Quality control (74 vs. 27)
• Poor communications (71 vs. 38)
• Cultural differences (53 vs. 24)
• Not guaranteed to save money (47 vs. 8)
• Possible delays (43 vs. 11)
• Insufficient client attention by vendor (38 vs.
  11)
• Difficulty exchanging documents (32 vs. 8)

http//www.cenews.com/article.asp?id2254 -
Offshore outsourcing A problem or a solution?
Tuesday, July 31, 2007
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Cost Reduction Perception vs. Reality
http//www.cenews.com/article.asp?id2254 -
Offshore outsourcing A problem or a solution?
Tuesday, July 31, 2007
25
Case Studies

• Javelin Technologies has been serving Canadian
  customers since 1997

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Trojan Technologies (link)

• Company
• Design and manufacturing of ultraviolet water
  treatment disinfection systems
• Goals
• Faster turn around time
• Enable global product development
• Automatic document control and issue
• How
• Deployed multi-site Enterprise PDM
• Javelin Services developed custom document
  generation program
• Results
• Round-the-clock product development
• Resolved data management issues with SolidWorks
  Enterprise PDM

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Trojan Technologies Interview with Jason Cerny
(May 19, 2009)

• Which different locations are you working
  between?  
• Bangalore India Shanghai China (as well as home
  office of London, Ontario)
• Are they outsourced companies or considered part
  of Trojan?  
• Bangalore is an "outsourced company".  We use TCS
  (Tata Consultancy Services).  China office is
  part of the Danaher Development Center (DDC).
• What types of engineering or tasks are done in
  these locations? (ie. concept design, electrical
  engineering, mechanical design, drafting,
  manufacturing, etc.)  
• Bangalore is only doing remedial and
  redundant tasks, such as daily production work
  and EN's for standard existing products, freeing
  up our engineering talent to work on the bigger
  problems. 
• They excel at speed and efficiency, but not so
  much at conceptual design.
• China office is co-developing a new product "for
  China, designed by China, sold in China,
  manufactured in China" using existing core
  technologies from Trojan. 
• Both teams are fully integrated into Trojan
  London teams on a daily basis.
• What are some of the challenges working between
  these offices?  
• Communication  time differences. 
• Also sending physical products back and forth is
  difficult as it takes a long time to clear
  customs etc. 
• What are some of the advantages that you are
  seeing having these multiple sights?  
• time (work around the clock). 
• The ability to "flex the team size to suit needs,
  without having to hire/layoff for peak demands.
• Is Enterprise PDM helping coordinate the
  communication and collaboration?  
• yes with replicated servers, all files are synced
  in off hours, twice daily...end of our day, end
  of theirs. 

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Magna Marque (link)

• Company
• Design and manufacturing electric bike motors in
  partnership with BionX
• Goals
• Work effectively with multiple offices in Europe
  and Quebec
• Keep data centralized to maintain control over
  revisions while enabling remote design teams to
  access data
• How
• Deployed multi-site Enterprise PDM
• Javelin Services setup system to company
  specifications
• Results
• Sites are happy with local performance
• Projects can be monitored easily from main office

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Magna Marque Interview with Fabio Vernier (May
19, 2009)

• Which different locations are you working
  between?  
• Austria, Germany, Aurora (Ontario), Sherbrooke
  (Quebec) and China
• Are they outsourced companies or considered part
  of Magna Marque or BionX?  
• Most locations existed before partnership
  started. China is the newest one and is a single
  employee of Magna Marque
• What types of engineering or tasks are done in
  these locations? (ie. concept design, electrical
  engineering, mechanical design, drafting,
  manufacturing, etc.)  
• Austria, Germany, Aurora and Sherbrooke do
  complete design work on various projects that are
  managed centrally.
• China does some product documentation and is
  mainly in charge of outsourced purchasing for
  components
• What are some of the challenges working between
  these offices?  
• The offices existed before the partnership
  started.
• We are currently in the process increasing the
  coordination between offices to reap more
  benefits. The coordination between the people
  has been slower than anticipated.
• What are some of the advantages that you are
  seeing having these multiple sights?  
• Time zone has been an advantage for
  responsiveness
• Local European designers have helped keep a
  European flare on our leading European products.
  We have a new one being launched in September
  that we are all very excited about.
• Is Enterprise PDM helping coordinate the
  communication and collaboration?  
• Enterprise PDM is a good tool and has been doing
  a great job coordinating the Sherbrooke and
  Aurora office. We are currently in the process
  of taking more advantage of some of the more
  advanced functionality in the European offices.

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Where Javelin Technologies is Helping

• Providing 3D Design/Manufacturing software and
  services since 1997

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Battling Global Communication with Enterprise PDM

• Coordinating designers in different countries
• Keeping track of versions and revisions with
  change comments
• Prioritizing work based on automated workflow
• Searching for files and leveraging existing work
• Teaching and enforcing company procedures
• Automate information flow into ERP
• Moving all processes electronic

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Staying in control of Quality with Enterprise PDM

• Controlling who can see or modify documents
• Maintain full history for accountability
• Making sure global offices are using the latest
  or released files
• Enforcing regulations by building them into a
  system
• Prioritizing data and organizing change orders
• Eliminating retyping

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The fight against more outsourcing Challenges

• Maintaining control
• Centralize work, Report on productivity
• Keeping IP close
• Automated permission toggling based on task
• Cultural differences
• Cant help much hear
• Fear of unknown
• Can help you with referrals of companies that
  have experienced the Unknown
• Exchanging documents
• Eliminate the need for e-mail and FTP transfer

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The fight against more outsourcing Challenges

• Extra time spent on management
• Searching and reporting on work quality and
  productivity can perhaps help
• Finding correct work to outsource
• Can share stories of what other customers have
  successfully outsourced
• Costs associated with possible travel
• Will give you a travel voucher if you can help us
  out with a referral for a company that we may be
  able to help

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Simple Process Control is Paramount
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Importance of Data Replication
Enterprise PDM Database Server
Main Office
LAN
Replicated Enterprise PDM Archive Server
WAN
WAN
WAN
Remote Office 1
Remote Office 2
LAN
LAN
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SolidWorks Enterprise PDM Offerings
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Outsourcing Conclusions

• Does save money, but less than usually
  anticipated
• Best initial tasks to outsource should be
• Within countries expertise
• Where less value is added
• Tasks where speed and efficiency can be amplified
• Perceived drawbacks can be overcome if
  anticipated and dealt with proactively
• Screening and working with the correct vendors
• Assigning tasks where productivity can be easily
  monitored
• Implement a way to collaborate efficiently on
  projects
• Maintain control over IP by breaking up tasks
  between vendors
• Working globally is not for every company the
  pros and cons should be evaluated thoroughly