1. 2005 Design Outsourcing Study

2. Design Outsourcing Study 2  Web survey:  Fieldwork dates  December 15 th - December 31 st, 2005  303 usable responses (confidence interval +/- 5.5%)  Sample frame:  EE Times and Electronics Supply & Manufacturing readers  Management positions  Involved with making design outsourcing decisions Methodology

3. Design Outsourcing Study 3 Experience with Design Outsourcing 2. For how long has your company outsourced at least a portion of its design activity? N (Those who currently outsource or plan to outsource to a 3 rd party) = 191 Mean = 4.7 years

4. Design Outsourcing Study 4 Locations of 3 rd party design firms 2a. What are the locations of the 3rd parties to which you outsource design? Net by Geography Americas: 84% Asia: 47% Europe: 23% N (Those who currently outsource or plan to outsource to a 3rd party) = 190

5. Design Outsourcing Study 5 Proportion of designs outsourced Current vs. prospective 3a. What proportion of your company’s total number of design projects in the past 12 months included some design outsourcing? 3b. In two years, what proportion of your company’s total number of design projects will include some design outsourcing? N (Those who currently outsource or plan to outsource to a 3 rd party) = 187 Mean = 37% Mean = 43% 30% or less More than 30%

6. Design Outsourcing Study 6 Projection of design outsourcing activity in next two years 12. In the next two years, the proportion of design work that is outsourced from the proportion your company now outsources will... N (Those who currently outsource or plan to outsource to a 3 rd party) = 190

7. Design Outsourcing Study 7 Design activities outsourced 3c. Does your company outsource… N (Those who currently outsource or plan to outsource to a 3 rd party) = 191

8. Design Outsourcing Study 8 Chip level design activities outsourced 4a. Which of the following chip level design activities does your firm outsource? N (Those who currently outsource chip level design activities to a 3 rd party) = 76

9. Design Outsourcing Study 9 3 rd party design firms Chip level design 4c. To which types of 3rd parties does your firm typically outsource chip level design? N (Those who currently outsource chip level design activities to a 3 rd party) = 76

10. Design Outsourcing Study 10 Board level design activities outsourced 5a. Which of the following board level design activities does your firm outsource ? N (Those who currently outsource board level design activities to a 3 rd party) = 103

11. Design Outsourcing Study 11 3 rd party design firms Board level design 5c. To which types of 3rd parties does your firm typically outsource board level design? N (Those who currently outsource board level design activities to a 3 rd party) = 103

12. Design Outsourcing Study 12 Software design activities outsourced 6a. Which of the following software design activities does your firm outsource? N (Those who currently outsource software design activities to a 3 rd party) = 112

13. Design Outsourcing Study 13 3 rd party design firms Software design 6c. To which types of 3rd parties does your firm typically outsource software design? N (Those who currently outsource software design activities to a 3 rd party) = 110

14. Design Outsourcing Study 14 3 rd party design firms Systems design 7. To which types of 3rd parties does your firm typically outsource entire system design? N (Those who currently outsource entire system design to a 3 rd party) = 110

15. Design Outsourcing Study 15 Evaluations of outsourcing 8. What has been the impact of design outsourcing for your company? What has been your evaluation of your firm's decision to outsource design activities? N = Those who currently outsource or plan to outsource to a 3 rd party

16. Design Outsourcing Study 16 Impact of design outsourcing Asset or liability? 9a. Overall, would you say that design outsourcing has been a net asset for your company, or a net liability? N (Those who currently outsource or plan to outsource to a 3 rd party) = 190

17. Design Outsourcing Study 17 Problems encountered during design outsourcing 10. What problems have you encountered in outsourcing design activities? N (Those who currently outsource or plan to outsource to a 3 rd party) = 166

18. Design Outsourcing Study 18 3 rd party location Most positive experience vs. most negative experience 11a. As you think about your most positive design outsourcing experience, where was the 3rd party located? Positive Americas 77% Asia 16% Europe 8% N (Those who currently outsource or plan to outsource to a 3 rd party) = 180 Negative 54% 37% 9% 11b. As you think about your most negative design outsourcing experience, where was the 3rd party located?

19. Design Outsourcing Study 19 Attitudes toward outsourced design projects 13. Please tell us whether you agree strongly, agree somewhat, disagree somewhat or disagree strongly with each of the following statements. Our design projects… ‘Agree Strongly’ + ‘Agree Somewhat’ responses N = All respondents Our design projects…

20. Design Outsourcing Study 20 Views on design outsourcing 13. Please tell us whether you agree strongly, agree somewhat, disagree somewhat or disagree strongly with each of the following statements. ‘Agree Strongly’ + ‘Agree Somewhat’ responses N = All respondents Design outsourcing…

21. Design Outsourcing Study 21 Respondent characteristics Job Title Company Type Company Size Current Location Internal Design Center Location Proportion annual sales volume represents sales outside North America Proportion manufacturing done outside North America