On the backdrop of new deals being signed and several market size estimates being published by research firms, ValueNotes decided to do a reality check on the situation by conducting an industry-wide survey, ESO survey 2010: 'How does the engineering industry feel about outsourcing?'. The purpose was to assess the global reaction to outsourcing in the engineering services segment - to gather perspectives on the engineering industry in terms of its challenges, outsourcing experiences, favored outsourcing destinations, cost savings and future proclivity to outsource.

The survey was taken by over 200 participants globally, across industries. The participants included engineering service buyers (manufacturers), service providers and industry analysts.

Exhibit 2: Survey participants

Source: ValueNotes report - Engineering Services Outsourcing: Perception vs. Reality

Key challenges faced by buyers

We identified some of the major challenges faced by engineering manufacturers. They were asked to rate the following challenges as key challenge, manageable challenge or not a challenge:

• Adapting to new technologies
• Addressing new geographies
• Pressure from competitors
• Supply-chain issues
• Identifying key vendors/suppliers
• Cost/margin pressures
• Lack of in-house capabilities