Electronics Design/Engineering: One-Stop vs. Specialty Firm?
By TFI Sr. Analyst Anne Feith and TFI Marketing Consultant Beth Dickinson
Oct 08, 2012
A client asked us to find excellent North American design/engineering firms. As the recommendations started to come in, a debate raged to the surface: What makes the best design/engineering firm for complex electro-mechanical systems - a turnkey design-and-manufacturing model, or a specialty design-firm model? So far, the only common thread among the points of view is,
The question of one-stop shop vs. specialty design firm gets trickier when there are specialized features involved, such as mechanical content (like small-scale robotics and other moving parts), RF/wireless, or medical/biotech. And because OEMs say that excellent project management skills make or break an outsourced engineering engagement, it's important to consider which model is best for on-time, on-budget, reliable engineering deliveries.
Mark Stephenson, VP of Design Services at Creation Technologies, a contract manufacturer with multiple design centers in North America, says it depends on a variety of variables, including product family, industry, and technology involved. For example, for medical device products it's better to use a design firm that's tied into a CM because of regulatory considerations - to condense speed-to-market windows. If it's a stand-alone design firm with transfers to a separate manufacturer, the FDA audits could add 6-12 months to your timeline. For electro-mechanical and optical products that tend to have higher complexity and more configurations, he maintains it'll be quicker to market to use an integrated supplier. For start-ups looking for designs and - after proving the market and securing additional financing - smaller manufacturing runs, a specialized design firm might be a better choice. In general, Stephenson maintains that "timeline and speed to market matters. When you add another party, timelines and budgets increase."
Ken Arnold, CEO of standalone design-engineering firm HTE, says "While it seems easier and safer to hand off an entire project to a one-stop shop at first blush, the efficiency and end results will suffer if either the design house or the manufacturer is not a good match for the product and technology in question." A one-stop trying to handle a design for which its manufacturing group is inexperienced will be less efficient. For example, if they lack the proper equipment and personnel trained to build products with the types of sensors and actuators typically found in robotic systems, they will struggle to adapt and timelines will fail. Adds Ken, "an independent 3rd party design and manufacturing review is well worth the minimal cost involved. Everybody performs better when they know someone will be looking over their work product!"
Another factor to consider is the expertise of the designers. Pam Wiseman, Sr. Supply Chain/Operations consultant, points out that, for cost and time efficiency, it's critical that the designer be an expert in the "key" technology in the product's design. And, she says, if they don't do 100% of the design in-house, "they need to be a great systems integrator."
What's clear is whatever model you choose, strong project management is paramount. No matter how skilled the designers or experienced the manufacturers, if controls are not in place to ensure excellent budget management, deliverables tracking, and communication, then the customer will suffer.
Which model have you found works best for you for your design/engineering needs – especially with significant mechanical complexity? What companies do you recommend? Post a comment.