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Recommendations for organisations choosing a location to set up an ER&D centre
Recommendations for organisations choosing a location to set up an ER&D centre

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Post pandemic, many ER&D organisations have revisited and re-aligned their supply chain processes as well as their geographical footprint, owing to lockdowns due to covid. ER&D companies are looking to minimize the risks as a result of the pandemic and thereby a well-planned location strategy is key to reduce potential disruptions and address a rapidly evolving landscape.

There are many points, apart from the assessment parameters, that the ER&D organisations must keep in mind while choosing a location.

 

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  1. Role of digitization – Digitization has accelerated across sectors and companies, especially in the last 2 years due to covid. With lockdowns forcing everyone to adopt digital technologies and work remotely, and embrace cloud and other IoT and other technologies, companies are no longer bound by a singular location to deliver. The pandemic has acted as a catalyst to work in a hybrid or remote environment, adopt cloud and other technologies to collaborate even when present in different locations and deliver effectively to the clients and other stakeholders.  

 

  1. Cloudification – ER&D companies across the world are adopting various technologies to accelerate digital transformation within their organisations and be prepared for the next disruption. Companies are creating intelligent workplaces and collaborations and improve productivity and innovation. Many ER&D companies have continued to leverage cloud technologies to bring different locations together and collaborate to diversify supply chain risks and other risks associated with operations concentrated in one location. Therefore, adoption of cloud technologies by the companies also features as an important factor while shortlisting a location for setting up an ER&D centre.

 

  1.  Focus on talent availability and ER&D ecosystem and not just costs – Companies should focus on locations with ample availability of freshers and experienced talent who will bring the right balance of technical competence, skills, domain expertise and young talent with digital expertise as well. Presence of talent implies presence of universities and technical colleges as well which will serve as a bedrock for future tie-ups and collaborations for new technology development. Existing ER&D ecosystem also helps in ER&D companies to leverage the existing mature ecosystem for their scale up fast. The right environment and talent will go a long way in building an organisation which will be able to scale up fast. Cost arbitrage is no longer the only parameter that enterprises are focusing on.

 

  1. Need for a tailored location strategy – An ER&D enterprise needs to develop a location strategy based on its medium- and long-term strategies. A ‘one size fits all’ approach no longer works for them. The ER&D companies must assess their business needs and build the right location framework taking into account all the parameters.

An organisation must devise its locations strategy by taking into consideration all the parameters, its own business needs and long-term and short-term strategies, availability of resources and existing ecosystem. Each organisation is different and needs to decide which location will aid in the overall growth of the company.

 

Read more about this in the report “Engineering Research and Development – Global Location Analysis” from the links below –

NASSCOM Website – https://nasscom.in/knowledge-center/publications/engineering-research-and-development-global-location-analysis

NASSCOM Community - https://community.nasscom.in/communities/engineering-research-design/engineering-research-and-development-global-location

 


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Vandhna Babu
Principal Analyst - Research

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