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Top activities and skills in demand in global ER&D GCCs and ESPs
Top activities and skills in demand in global ER&D GCCs and ESPs

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Insights in this blog are from NASSCOM-Deloitte Global Engineering R&D Pulse Survey, which spanned a survey of enterprises across North American, EMEA, and APAC regions, with participation from over 100 end user enterprises from eight key verticals across 19 countries.

 

Engineering Global Capability Centres (GCCs) and Engineering Service Providers (ESPs) form the lifeline of the Engineering R&D (ER&D) industry. Both have shaped the way the industry has ER&D ecosystem has evolved over the years. In recent years, many activities have moved to GCCs and ESPs as they continued to play a crucial role in helping Indian as well as global enterprises create competitive advantage, move to a digital-first paradigm, and create tangible business value.

Organisations have always encouraged their GCCs to focus on development, testing, and integration. However, in the past many years, GCCs have been evolving in maturity and are not just seen as captive units of the headquarters. In recent years, top activities that have migrated to the GCCs include research and advanced engineering, driving innovation, developing CoEs for digital engineering, and focus on emerging tech.

ESPs are also moving along the value chain and their customers are increasingly sharing IPs with the ESPs, leading to a shift in the activities coming to them. ESPs are focusing on moving beyond traditional activities and becoming strategic end-to-end partners to their clients. Hence, activities such as ‘quality management ‘and ‘advanced 3D modelling’ are fast gaining traction with ESPs. Companies are also using ESPs for their expertise in specialised skills, which in essence provides a competitive advantage to companies.

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Region wise analysis

  1. For EMEA-headquartered companies, activities moving to GCCs and ESPs include ‘manufacturing and operations’ and ‘process standardisation’. The countries in EMEA (especially Germany and France) are home to some of the major global companies in the automotive, aerospace, industrial, and energy sectors. Hence, non-India GCCs (presumably in nearshore locations) receive core manufacturing activities.
  2. For APAC and North America headquartered companies, priority has been on delivery of ‘research and advanced engineering’ and ‘software design and engineering’ from their global centres. This is primarily due to the presence of some major global companies in the software products and hardware and electronics sector in those geographies.

 

Digital and core engineering skills sought after in GCCs and ESPs

Owing to the changing landscape, especially post pandemic, ER&D GCCs and ESPs are continuously upskilling and reskilling their workforce in both digital and core engineering skills. With key partnership models with academia, engineering and management and other skilling institutes, having a right kind of talent becomes a differentiator for any ER&D company to excel ahead.

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Sector wise analysis

  1. Software product sector - We have witnessed an increasing number of ER&D companies shifting the focus of their activities to Cloud. In addition, in the aftermath of the pandemic and a “work from anywhere” culture adopted by companies, cyber attacks have exponentially increased since pre-covid times. Therefore, cloud computing and cyber security remains key skills for the workforce.
  2. For the hardware and electronics sector, understanding of 5G and related technologies is of utmost importance, since the companies operating in these sectors are involved in the development and deployment of various applications of 5G.
  3. For automotive and industrial sectors, material performance directly affects customer experience. Therefore, the need for accurate, comprehensive mechanical analysis and testing of these materials continues to be critical for these sectors.
  4. Embedded medical system skills are crucial for the medical devices sector for frequent monitoring and management of patients’ health.

Engineering GCCs and ESPs both continue to move up the value chain and add value to their headquarter companies and their clients respectively. Global enterprises are increasingly adopting tech-enabled business models to stay relevant and continue their growth trajectory. And for this, GCCs and ESPs continue to play a vital role in creating strategic business impact with a strong focus on innovation, presence of a large and diverse talent pool, and the ability to provide differentiated service delivery.

 

Read more insights in the report – “NASSCOM-Deloitte Global Engineering R&D Pulse Survey 2022”

NASSCOM Community - https://community.nasscom.in/communities/engineering-research-design/nasscom-deloitte-global-engineering-rd-pulse-survey-2022

NASSCOM Website - https://nasscom.in/knowledge-center/publications/nasscom-deloitte-global-engineering-rd-pulse-survey-2022


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Vandhna Babu
Principal Analyst - Research

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