It's 9 a.m., and the engineers at Project Advisors International Ltd.'s office in Shanghai, China, are reporting for work.
Back in Detroit, where the company's customer of the moment is waiting for results, it's still 8 p.m., one calendar day behind.
While the American project boss slumbers somewhere in suburban Detroit, the Chinese team will work out the mathematics and physical glitches in the design of an automotive product that can't wait. When they finish, they will ship the entire project back to offices in Ann Arbor, Mich., where the American team will be arriving fresh from a night's rest.
Traditionally, design teams and engineering problem solvers laid down their computer mice at night along with the rest of the auto industry. Demanding schedules aside, nights, weekends and holidays were sacrosanct. But there's no more time for such luxury.
The industry is increasingly turning to overseas design and development offices to speed up the process of bringing new products to market. Not because overseas engineers are faster or better, but merely to keep the fluorescent lights burning around the clock.
Handing off a project to personnel who are six or eight or 12 time zones away allows a company to cut project schedules in half. Involving studios on more than two continents cuts the schedule even more.
The challenge for automotive firms who take advantage of this 24-hour-a-day approach to business: staying connected with the people who pick up the day's work.
'This isn't just about the telecommunications and computer systems that make this possible,' says Fred Nicholas, director of Project Advisors International's engineering services unit. 'It's also about people management. How do you keep people on separate continents focused on the same project goals and ideas?'
It's also about the hardware.
Project Advisors International is one of several companies in the industry that are capable of taking a project concept off of a manufacturer's hands, and delivering a set of blueprints that can be put into production. Companies such as Project Advisors International or Detroit giant MSX International Inc. rarely discuss the projects they are working on. Automakers and suppliers are loathe to publicize the fact that, for the sake of expediency, they have turned to an outside firm to create the axles or headlights or bumper fascia or the vehicle design itself on an upcoming product. But it was MSX that delivered Ford Motor Co.'s Ka small car in Europe in the 1990s. It is the German engineering house EDAG Inc. that will give General Motors its Hummer H2 sport-utility next year.
The hardware that makes this whole industry segment possible consists of powerful computer-aided design networks and reliable, highly secure Intranet communications lines.
For much of the auto industry in North America and Europe, there is now a single, common Intranet called ANX. ANX was developed by a committee working through the Auto Industry Action Group, a professional organization made up of companies from across the industry.
But the mere handful of Western telecommunications providers that currently offer ANX services do not yet operate in China, South America and much of the rest of the world. Unfortunately for some outsourced design houses such as Project Advisors International, those global regions contain the ideal locations for 24-hour, seven-day-a-week design support.
To compensate, it must maintain its own Intranet service with its Shanghai subsidiary, as well as with additional design operations in Brazil and Australia. The solution is more expensive. But at least for now, the private Intranet guarantees the sort of security that automakers and suppliers want from the design firms.
Every morning when the design team returns to the office in Ann Arbor, the company mailbox is full of files. The Michigan employees open the e-mails and begin work.
This is one of two seemingly simple approaches outside design houses are using to speed up programs. The other uses an overseas office to take over a project that the U.S. office can't do itself.
Late last year, a U.S. customer approached Project Advisors International about turning around a design change on a powertrain component. The automaker came calling on Dec. 20, 2000. It needed the project completed by Jan. 4, 2001. That would have meant hustling through a sensitive assignment over the holiday season. Not only would the supplier face scheduling difficulties with its U.S. personnel, but its entire North American support industry would be working on holiday schedules.
Instead, Project Advisors International handed off the job to its Shanghai office. It prepared the project and shipped it to China on Dec. 21. Shanghai completed the bulk of the work and then handed it off to Brazil on Dec. 27. Brazil finalized the work and returned it to Ann Arbor on Jan 4.
The approach seems perfectly ordinary, but it comes high up the industry's evolution curve. Only a decade ago, automakers were still jealously guarding their project drawings and specifications in 'data vaults.' Suppliers - even those individuals at daily work on a given project - had to have clearance to gain access from day to day.
A supplier who needed to make a change would have to check out a data tape to do so. He submitted a request for authorization to a project manager. The project manager ordered the specific piece of data pulled from the files, much as a librarian pulls a requested book out of storage. The automaker then provided a copy of the data on a reel of half-inch tape, or later a cassette of quarter-inch tape.
Finally, the supplier would send a runner over to the customer's office to retrieve the tape and bring it to the supplier's building. Even if things went smoothly, the process could take four days.
Who needs a job?
Today, the engineering and manufacturing world has the technology to speed up the manipulation of data, even when it is being done inside the manufacturers' studios and labs. But outside engineering companies typically have more flexibility in speeding it up.
One challenge faced by both inside and outside engineering offices is simply that second-shift work is never popular. And third-shift work is even less popular. Running two-shift design offices has been tried in the North American industry. But productivity lags among engineers who sit at CAD terminals as midnight draws near. The cost of employing day-shift engineers in North America is also much steeper than in China or Brazil. Project Advisors International runs three shifts in both Brazil and China at a fraction of the cost of a U.S. staff.
But labor cost is only part of the equation. MSX International moves part of its round-the-clock project work to Europe and back at night. A German engineering staff is hardly the definition of cheap overseas labor. The more critical issue is time.
Charging $40 an hour for non-U.S. engineering services instead of $100 an hour in the United States represents only one cost. Being able to beat the competition to market is a much greater cost component, Nicholas says. To an automaker bent on responding to a suddenly shifting consumer preference, the cost of round-the-clock design work is probably a small worry.
'What people want is better utilization of their resources,' Nicholas says. 'Customers go outside to be more productive. Our role is to help them become more efficient, to help them reach the market faster with new products.'