Competence-Based Decision Support for the Offshoring of Automotive Product Development Processes to India

Table of Contents

1 Introduction

2 State-of-the-Art Analysis

2.1 Insourcing, Outsourcing and Offshoring

2.2 Theories About the Offshoring Decision

2.2.1 Macro Economics

2.2.2 Market Forces

2.2.3 Resources and Competencies

2.2.4 Transactions, Contracts and Firm Boundaries

2.2.5 Summary of Available Theories

2.3 Existing Decision Tools and Models

2.3.1 Financial Tools

2.3.2 Strategic Tools

2.3.3 Benchmarking/Certification Tools

2.3.4 Summary of Existing Decision Tools and Models

3 Problem Statement and Goal of Present Work

3.1 Problem Statement

3.2 Goals of Present Work

4 Background to the Client Company and the Drivers of Offshoring

4.1 The Company

4.2 Identification of the Major Drivers of Offshoring

4.2.1 Reducing Costs: "The Global Cost Mix"

4.2.2 New Markets

4.2.3 Learning and Growth: "The Global Competency Mix"

4.3 Summary: Drivers of Offshoring

5 Product Development Processes at the Client Company

5.1 Modeling the Product Development Process

5.2 Deriving Necessary Competencies for Each Process Step

5.3 Identification of Cost Drivers and Success Critical Process Steps

5.4 Analysis of the Internal-External Customer Mix: Possible Problems

5.4.1 Difference of Interests

5.4.2 Diffused Decision Process

5.4.3 Differing Requirements

5.4.4 Conclusion and Final Remarks

5.5 Summary

6 Competence-Based Decision Model for the Offshoring of Product Development Processes to India

6.1 Goals and Success Factors for the Proposed Decision Model

6.1.1 Goals of the Proposed Decision Model

6.1.2 Success Criteria for the Proposed Decision Model

6.1.3 Summary of Goals and Success Criteria

6.2 Analysis of Offshoring Goals at the Client Company

6.2.1 Financial Goals

6.2.2 Customer Goals

6.2.3 Business Process Goals

6.2.4 Learning and Growth Goals

6.2.5 Overview: Offshoring Goals

6.3 Offshoreability Study and the Analysis of Expected Benefits from Offshoring

6.3.1 The "Offshoreability" of Processes

6.3.2 The Process Offshoreability Questionnaire

6.3.3 Financial Benefits from Offshoring

6.3.4 The Offshoreability Study: Conclusions

6.3.5 The Offshoreability Study: Summary and Final Remarks

6.3.6 Evaluation of the Offshoreability Study

6.4 Development of the Balanced Scorecard "Magnifying Glass" for the Evaluation of Possible Offshoring Partners

6.4.1 The Resource-Based View Applied to the Offshoring Decision

6.4.2 Mapping Offshoring Goals to Vendor Competencies

6.4.3 The Balanced Scorecard "Magnifying Glass" for Evaluating Possible Offshoring Partners

6.5 Development and Implementation of an Evaluation Methodology for Prospective Partner Companies in India

6.5.1 Development of the Evaluation Methodology

6.5.2 The Competency Map

6.5.3 Implementation of the Evaluation Methodology at Possible Partner Companies in India

6.5.4 Findings and Conclusions

6.5.5 Evaluation of the Partner Selection Methodology

6.6 Final Suggestions Based on Above Study

7 Summary and Conclusions

Objectives and Topics

The primary objective of this Master's thesis is to develop a robust, competence-based decision-support framework to facilitate the offshoring of automotive product development processes to India. The research addresses the strategic challenges faced by automotive supplier firms in developed markets by providing a structured methodology that integrates theoretical constructs—such as the Resource-Based View and Transaction Cost Theory—with practical, activity-based evaluation tools to identify optimal offshoring candidates and potential partners.

• Theoretical foundation of offshoring decisions within the automotive industry.
• Development of an "offshoreability" study to assess process suitability for transfer.
• Application of a "Balanced Scorecard" approach for evaluating prospective partner competencies.
• Implementation of a decision methodology with case-based empirical insights from India.
• Strategic mapping of firm-specific goals against vendor capabilities.

Excerpt from the Book

Summary of Chapters

1 Introduction: Provides an overview of the offshoring phenomenon and defines the research aim of developing a framework for offshoring engineering services in the automotive sector.

2 State-of-the-Art Analysis: Reviews existing theoretical models and decision tools related to outsourcing and offshoring, evaluating their applicability to the automotive context.

3 Problem Statement and Goal of Present Work: Articulates the specific research problem and the objectives the decision model must fulfill to be both useful and usable.

4 Background to the Client Company and the Drivers of Offshoring: Analyzes the specific client company's market environment and the strategic drivers behind their offshoring initiative.

5 Product Development Processes at the Client Company: Details the modeling of the company's product development processes and identifies cost drivers and critical success factors.

6 Competence-Based Decision Model for the Offshoring of Product Development Processes to India: Develops, tests, and evaluates a comprehensive decision model and partner selection methodology.

7 Summary and Conclusions: Summarizes the study findings and provides recommendations for future research and implementation.

Keywords

Offshoring, Automotive Engineering Services, Competence-Based Management, Resource-Based View, Balanced Scorecard, Product Development, Process Modeling, Outsourcing, India, Partner Selection, Decision Framework, Transaction Cost Theory, Strategic Management, Cost Drivers, Offshoreability

Frequently Asked Questions

What is the core focus of this research?

The research focuses on creating a systematic, competence-based decision support framework for automotive suppliers to offshore engineering services to India.

What are the central themes of the work?

The central themes include offshoring strategy, process modeling, partner evaluation, and the synthesis of Resource-Based View and Transaction Cost Theory.

What is the primary goal of the thesis?

The primary goal is to provide a holistic and practical decision-support model that helps management evaluate which activities are suitable for offshoring and how to select an appropriate partner.

What scientific methods are applied?

The study uses a mix of qualitative theoretical analysis, activity-based cost modeling, and an empirical questionnaire-based assessment of prospective partner companies in India.

What is covered in the main body?

The main body covers the theoretical state-of-the-art, a detailed description of the client firm's development processes, and the construction of a decision model using a "Balanced Scorecard" approach.

Which keywords best characterize this document?

Offshoring, Automotive Engineering, Competence Management, Partner Selection, Balanced Scorecard, and Process Modeling.

How is "offshoreability" defined in this model?

Offshoreability is defined as the ease with which a process step can be transferred to a distant location without compromising the quality or efficiency of the output.

Why was the Balanced Scorecard (BSC) chosen?

The BSC was chosen as a "magnifying glass" because it allows for a multi-perspective evaluation (financial, customer, internal process, learning/growth) of potential partners.