From the archives: Will outsourcing and software change the way engineers develop products?

Nov. 18, 2004
Industry executives think outsourcing and software will change the way engineers develop products. Are they right?

What does the future hold for new technologies and trends within engineering? And what social or technological trends are likely to affect the designers and engineers within those industries? These were the questions we put to industry leaders and experts as part of our 75th anniversary celebration.

There was no surprise that they found a lot to be concerned about. But there was also a lot of optimism regarding how we will bear down and address the challenges.


Many industry observers we talked with identified outsourcing as a major change. But there are two types of outsourcing: sending work overseas to low-wage countries, a widely accepted trend, and letting outside companies, not necessarily offshore ones, handle certain tasks such as specialized engineering or in disciplines outside the company's expertise.

David Canon, general manager of actuators & systems at Danaher Motion, for example, cites both. "Many OEM customers will transfer manufacturing operations to low-wage locations to better meet the need for global service and support. And we will continue to see firms outsourcing their engineering needs to suppliers and local distribution and systems houses, which will further feed the demand for complete, integrated systems."

Brian Shepherd, senior vice president of product management and marketing at PTC Inc., agrees. "Over the next decade or so, the ability to develop great products with a globally distributed and highly outsourced network of design and build teams will be the key discriminator of leading companies and superior financial performance. Already, many companies seeking to reduce development costs and shorten time to market are using offshore strategies and "follow-the-sun" continuous-work initiatives.

Wolfgang Daniel, president and CEO of Bosch Rexroth Corp., points out that: "The information age has changed the way we develop and produce innovation. Today, ideas can be distributed in minutes around the globe, and that will have a number of implications for engineers. Especially in America, which has been historically self-sufficient but will need to adapt to these global trends during the next decade.

"Outsourcing, especially, will send engineering tasks offshore, so tomorrow's engineers will need to interact with the global society. Language skills and knowledge about foreign culture will move from 'nice to have' to a must," he adds.

"One additional phenomenon is that international and global players are no longer developing processes unique to each country they service, but are developing solutions that can be implemented globally. This shortens the time to market and costs less because a process can be reused anywhere the industry is located. And similarly, specific knowledge gained from one industry, like food and packaging, can be applied in other segments that may be similar from a process standpoint."

"Fossil fuels are in limited supply, so there will be continued pressure to develop alternative energy sources. Environmental concerns will grow as the population increases and more areas of the world experience economic development. And laser technology will be one of the most dominant manufacturing methods after 2010."
— Wolfgang Dangle, President and CEO, Bosch Rexroth Corp.

Mike Santori, Business and Technology Fellow at National Instruments Inc. warns "Many might say the biggest issue for the U.S. engineering profession will be the outsourcing of engineering outside the U.S. Although this will certainly be a concern, it will be far more alarming if the U.S. isn't producing the engineering talent it needs to keep innovation and development of intellectual property in the states. So the biggest issue that will affect the U.S. engineering profession is the dramatically declining engineering enrollment in colleges and universities."

His solution? "It is essential the country turn out the best and brightest engineers in the world, and turn out a lot of them. Students today aren't given the opportunity to understand and appreciate the role of engineering in creating technology in their world. Airplanes, TVs, cars, and video games didn't happen by accident, after all. They were invented. Students have to be taught at an early age, before college, before high school, that engineering and science are exciting and full of really cool things. We have to teach students that engineering and science are about exploring, creating, and inventing, not just math and formulas."

Arthur Wilson, president of the Institute of Electrical and Electronic Engineers sounds a more optimistic note on the subject. "Last year's survey of IEEE Fellows, some of the world's leading technological minds, predicted that the U.S. would remain the technology leader over the next 10 years.

However, they also strongly favored increasing globalization and automating labor. They see an offset in shifting some labor to other countries, but it will lead to a massive movement to educate and maintain skilled workforces around the world. This will increase economic activity, open up governments to more democratic policies, and improve the standard of living in emerging nations."


Several observers pointed out that engineers can look forward to more sophisticated software tools that are comprehensive yet easier to use. And they will change the face of product development.

"Networks will be critical to driving the "distribution" of processing power. We'll evolve from wired to wireless networks, virtually eliminating the need for data cables."
— Joseph J. Lazzara, president and CEO, Scientific Technologies Inc.

"Usually, today's product-development systems consist of fragmented sets of tools, processes, and competencies built up over long periods of time and optimized for a bygone era of local teams, 8-hour workdays, and relatively rich budgets. That aging system is not up to the work of the future," says PTC's Shepherd. "Development tools should support both structured and ad-hoc collaborations that shrink the distances between globally distributed teams. The tools need to protect vital information while allowing the right level of access to the right team members, and allow the addition, modification, and deletion of team members on a moment's notice without large IT overhead. The tools should be easy to learn and capable of completing the jobs of today and the challenges of the future. In three words, the new product-development system has to be simple, powerful, and connected.

Software must also get more specific, dealing with the new technologies cropping up in practically every industry and engineering discipline. "For example, system-level design tools will have to help engineers build devices containing not only traditional processors, but also field-programmable gate-arrays and digital-signal-processing chips and incorporate diverse I/O and networking technologies," notes Santori.

Michael Bussler, president of FEA software supplier Algor Inc., believes the software industry understands this and is moving in that direction. "In recent years, market forces have driven CAE vendors to develop robust CAD integration and easier-to-use simulation tools. Now, as trends toward higher-technology and increasingly more complex products such as MEMS continue, engineers in multiple disciplines work together more frequently. Ideally, this work will be done using a single multiphysics tool within a single user interface. Meeting this need, however, will require tighter integration of all design tools into a true virtual prototyping/ testing environment."

He also points out that engineers also want more from simulation. "CAD users are looking to expand what they do with simulation and simply want all of their design and simulation tools to communicate directly and easily," he says. "They also want to consider more than just structural loads acting on a model. So heat, fluid flow, and other multiphysics effects are increasingly included."

"The CAE industry is also working to tightly integrate multiphysics analysis into a single process so engineers can simulate entire scenarios that incorporate entire products and the environments in which they will be used," he reports. "CAE vendors are also working to make their software support all types of analysis within the same user interface, easily couple results from one type of analysis to another, and simulate motion as well as standard multiphysics effects."

He also believes software developers will focus on open-design environments that use open-architecture and industry-standard data formats that will be flexible enough to work with any software an engineer might need. "Creating an open-design environment could be as simple as letting users access frequently used applications through CAE software," he says. "Users could also use built-in scripting tools and plug-in support to automate data transfer and format conversions between applications."

In the future, Bussler predicts open-design environments and improved simulation technologies will lead to true virtual prototyping. "No longer will users analyze one instant in time as with linearstatic stress analysis," he says. "Instead, simulation will routinely include large-scale motion, impact and stress analysis, and other multiphysics effects. Growing computing power will speed simulations, which will let users see results in real time and focus on accurate representations of products. Animated results will show product behavior in particular scenarios rather than just turning out numerical results that need to be interpreted. And as computer graphic technologies become more realistic, virtual prototypes will look increasingly like videos of physical prototype testing. Seeing the behavior of a design on the computer will let engineers develop useful, real-world insights into their designs and reduce expensive physical testing, thus lowering cost and time to market."

One view on the issue:
The future of factory automation

Gary Marachuk | Director of Business Development, AutomationDirect

Industrial controllers will no longer be classified by internal design architecture. And most controllers will continue to use some portion of commercial, offtheshelf technology in its CPU, operating system, memory, or data storage. PLCs and hardware will become more transparent as technology does the work, instead of the customer having to learn everything about the product. Instruction sets will be more intuitive, HMIs more integrated into the PLC architecture, and I/O modules will have universal interfaces and configure themselves. All this will simplify installation.

We will likely see even more "cross-pollination" from PCs, such as using specialty cards and universal connector systems. PLC products will also get smaller and offer what were once considered "high-end" features for a price that will make them seem almost "disposable."

Ethernet as a fieldbus will meet OEM needs because it has what users want. With its overwhelming amount of low-cost leveraged technology and huge installed base, Ethernet cannot help but capture significant market share. The hardware is inexpensive, reliable, and easy to use. Its protocols make it flexible enough to service everything from fast I/O control, to configuration, data, and diagnostic applications requiring large file transfers. Customers will benefit from easy installation and low-cost peripheral options, higher speed data exchanges, simultaneous peer-to-peer and master-slave communications, and common TCP/ IPprotocol stacks that connect directly with other Windows-based systems, shedding the PLC stigma of a "silent black box." Proprietary technology will also become less prominent in the future. Instead, it will be hidden internally providing low-cost, high-performance functions such as Ethernet.

One view on the issue:
Safer and safer factories

Joseph J. Lazzara | President and CEO, Scientific Technologies Inc.

The evolution of global safety standards, new technologies, and the desire to improve workplace safety will drive improvements in integrated machine safety. For example, within the next five years, we will see wider adoption and greater sophistication of safety controllers, which includes devices such as safety-relay modules, relay-controller hybrids, PLCs, and specific-function controllers, such as a muting controller.

The next step on the road to more intelligent safety controls will be relay-controller hybrids, often described as modular controllers. These simple controllers have relay or electronic-based expansion modules. They fill the gap between safety-relay modules and more complex PLCs.

Another trend will be the development of safety-rated communication buses and networks. These networks will help integrate safety and machine controls into one seamless system. They will use much less wiring, thereby reducing installation costs. And the use of network cables, usually wired in series with the devices, will transfer status, diagnostic info, and safety-critical data. This saves on design, materials, and installation, and the increased intelligence and diagnostics translate into less machine downtime and higher productivity.

Safety buses can utilize devices with more than just on/off or open/close outputs. So designers should expect bus-connection devices to grow. Devices such as interlocks, emergency stops, and light curtains have appropriate communications protocols and thereby provide improved diagnostics. Another trend involves devices for specific types of machines. This is different from general-purpose safeguard, such as a light curtain, safety mat, or interlocks.

Traditional safety devices will continue to be used, supplemented, and perhaps replaced in some applications, but not all. Devices will become smaller, easier designed, and easier to design into a large machine. Diagnostics and displays will also be simpler and more sophisticated. For example, a factory rep might remotely connect to and diagnose a device, and be able to tell the customer how to fix specific problems.

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