Regionalization of engineering: A structured process including risk considerations

The companies active in international project business are faced with the optimization task how the different phases in the technical value chain can most efficiently be shared between headquarter and local country organizations. Many regionalization cases the authors have examined have critical issues in domains such as internal setup, strategy, risk assessment, or know-how transfer. Therefore, in this paper, a process detailing how regionalization efforts in engineering can be effectively organized is explained, especially taking into account how typical risks inherent to regionalization can be identified. The process starts by defining regionalization goals in relation to the business strategy and identifying possible risks. After analyzing the preconditions, a regionalization concept is established by careful evaluation of different scenarios. Upon decision for a certain scenario, detailed planning of regionalization is started, including e.g., preparation of change management and ramp-up of engineering manpower. Setting up the local organization includes training of employees, preparation of suitable environments and adaption of engineering processes. In this phase, the first regionalized projects can be performed. A carefully chosen lessons learned process helps to augment the performance of the organization in its environment; a phase-out step may conclude the work in a regionalized environment. Practical information gained from expert interviews and taken from real regionalization cases in a multi-national company is presented in appropriate detail to illustrate the principles. They verify the approach and show the direction of further research.