Tips & Resources

When to Outsource Product Design, and When to Keep it In-House

Sam White
Sam White November 11, 2020 • 0 min read

A Guide for Product Managers, Engineering Managers, and C-Suite Executives.

Let’s play out a scenario that might be familiar to you: your business has tasked you with building a product you’ve never done before. In fact, your company has never done anything like this before. You need to tell your boss or your stakeholders how long, how much, but you’re stuck. You’ve started the effort with your internal engineering team but the results aren’t great. You know it’s not right, but you’re having trouble saying what’s wrong with it. Maybe everything’s wrong with it.

You know you need to solve this problem, but how do you solve it?

You don’t want to just meet your goals. You want to create a product that will inspire your team, wow your leadership, and win design awards. You know it’s not going to be easy, but you’re up for the challenge.

The biggest initial decision, once you evaluate your resources, is to figure out whether you’re going to design your product in-house, or partner with a product design firm for at least some of the process.

You could hire an external design firm, but you’re worried:

  • Will they get it?
  • Will they integrate with the team I already have, or replace them?
  • Will there be cultural barriers to bringing them in?
  • What are the optics if I suggest going outside the business to hire, when I already have an engineering team in place?

It would be easy for us to say you should always outsource, but the truth is that it’s a complex decision driven by a number of factors.

Sometimes outsourcing is the perfect choice, and sometimes it isn’t. After 20 years of operation as a design partner for medical device and consumer product companies, we at Cortex Design have gained a wealth of experience of when things go well, and when things don’t.

Hopefully our experience will be helpful to you in making that decision for your own organization.

When to Outsource Your Product Design:

If you’re feeling the time crunch, and you need to move fast.

Stakeholders place tight time constraints on new product launches that can be unrealistic for a team that isn’t yet built. When you partner with a product design firm, you can go from zero to one-hundred percent of the resources you need in a matter of days.

Cortex Design and other reputable product design firms will have an a la carte menu of services and staff that you can plug into your process, including industrial design, mechanical engineering, prototyping, fabrication, product testing, electronics development, firmware development, and all other turnkey services required to launch a new product.

You might have the green light to build an internal team for all these functions, but if you need to find, qualify, incentivize and hire all of those staff people, you can can add months to your process. Now your company has added full-time staff that you have to justify after your product has launched. For products with tight time constraints, a partnership with a product design firm can be the faster, more flexible option.

If you’re trying to get fresh perspective and avoid tunnel vision.

If all you have is a hammer, everything starts to look like a nail. When you’re trying to create exceptional products, it’s valuable to have outside perspective to bring creativity from beyond your industry and organization.

When working in the same industry for a long period of time, you gain expertise, but assumptions and patterns of behaviour tend to repeat themselves.

Product designers flourish when we have fresh challenges, new industries to work in, and diverse projects. Our value is in our ability to find inspiration from surprising sources, to cross-pollinate ideas, and to see things from a user experience point of view.

It is common for us to work with an engineering team to break down those assumptions and give them new super-powers; new insights or methodologies that they simply aren’t exposed to in their day-to-day lives, and inject fresh energy and excitement into the design process.

If risk of failure is an issue within your company.

Engineers are great risk mitigators. That’s often a good thing! They work within established constraints to develop practical solutions. But when challenged to do something completely outside the box, this can be a barrier to innovation. An in-house product design team can be more hesitant to radically rethink ideas, or afraid to fail within an organization they have no intent of leaving. But you want to think in a blue-sky way about what your product can be, and enable your team rather than endanger them.

A product design firm, by the nature of the relationship, is able to try things that you might not have thought were possible. For example, we worked with an established market-leading company that makes high-precision measurement equipment, with incredibly smart engineers and mechanical designers. But there was an entrenched view at the company that their low production volumes limited their manufacturing methods to sheet metal enclosures. We helped them re-envision their whole product line by removing this barrier, and introducing them to high-speed / low cost CNC prototyping methods that were still economic at their product volumes.

By outsourcing your product design, you can leverage outside expertise and both amplify and increase your in-house team’s experience and capability.

If you’re launching a product with high barriers to market entry.

Some industries have high barriers to entry for new products, and that can prevent projects from moving forward rapidly. For example, in medical product design, there are long regulatory hurdles to overcome which introduces long delays between project phases. If you’re not sure whether your stakeholders can commit to moving the project past the proposal or prototype stage, it can be a huge financial and time risk to build a multifaceted internal design team without knowing whether you’re going to need them for the long term.

For these sorts of projects, a partnership with a product design firm can bring a vast wealth of engineering and industrial design talent to the table without the commitment and risk of building a capability in-house. Design firms are used to working in phases and sprints, and working very efficiently to keep the cost of individual sprints under control.

When to Consider Keeping Your Product Design In-House:

If you’re working in a business where you need to constantly iterate your products.

If a natural part of your business activity is rapid iteration of your products, then you’ll have a volume of work that will support building your product design capability in-house. Some businesses rely on releasing the latest and greatest versions of their products every year, for example, housewares, furniture, toys, and tool lines. If that’s your business model, you can justify the long-term expense of spooling up an internal team, and you’ll be able to leverage their experience as you create new versions of your product over the course of years. For these sorts of projects, it might be ideal to work with a product design firm for concept generation and use your internal resources for the rest of the product development.

If time is not an object.

If there’s no urgency to your project, and the labour cost of keeping internal staff resources is not a major concern, then an internal team can work on it on an as-needed basis. For example, research projects in academia can be long-term and move too slowly for a design firm. This can also be the case with public or government funded research projects, that tend to be long, slow (relatively speaking) efforts where the goals are a little more nebulous as the research progresses.

If you’re hiring a design firm, it’s usually because you want to accelerate. Without urgency, design firms can have trouble matching your pace and maintaining their own focus on a project that may stop and start over a period of years. If your project is the type where slow and steady wins the race, you might want to keep your product design in-house.

If your project’s goals aren’t well-defined.

If you own a technology that’s already developed, but you need to interpret it for your audience, that’s a great opportunity to outsource. For example: when we worked with CloudDX, they had a great technology portfolio, a strong medical knowledge portfolio, and great algorithm developers, but they needed a partner to accelerate the design during a relatively short period of high-intensity work. We had a team in place, a supply chain in place, and multi-disciplinary skills that allowed us to bring their existing technologies together to quickly achieve the project’s goals.

However, if your company doesn’t own the technology that will make the product successful, and if the project’s goals aren’t well-defined, it’s more of an R&D project where the potential for failure is much higher and needs to be tolerated as part of the process. This doesn’t mean you shouldn’t outsource your product design in these cases, but it’s important that your stakeholders recognize the risk upfront. If they’re unable to do so, it might be best to keep your product design in-house — at least until the project’s goals and technology are better established.

If your company has no product champion.

To take a product across the finish line, that product needs a champion who is passionate about the project’s success. The product champion needs to be someone who has a high level of motivation, and is personally invested in the success or failure of the project. If your team lacks a true product champion, it’s going to be hard to drive an external team to success. You can’t outsource passion for a project; if you’re not feeling it internally, or can’t put a design firm in touch with the product champion within your organization, it’s an issue that needs to be resolved.

You have read this post to the end… which is a good indicator that you are that product champion. Do you recognize these attributes within yourself? We’d love to hear from you! Of course, if you completely disagree with everything we’ve shared, we’d love to hear from you too!

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