Thursday, October 30, 2008

EMS Trends

Meredith Courtemanche, managing editor

Bringing together the A-Line on-the-conference-floor assembly line for producing a sample board at IPC Midwest with IPC, The Morey Corp., and our equipment providers gave me a unique insight into the amount of work that goes into every PCB assembly manufactured. To dig deeper into the EMS industry, I chaired a panel of EMS providers at the show in September. The speakers provided concise advise for keeping EMS lines running efficiently and keeping OEM customers on track and happy, for product development, project launch/new product introduction (NPI), manufacturing, and program management. Concise, efficient, and resourceful. What else would you expect from this industry?

Presenters included Susan Mucha of Powell-Mucha Consulting, Kevin Stone of Kimball Electronics Group, James Scholler of MEC Innovation, and Ross Clark of The Morey Corporation. Major trends in the EMS industry included robust product launch/new product introduction (NPI), communication and awareness with the customer and your supply chain, and resource and risk responsibilities.

Jim Scholler, VP of technology of Milwaukee Electronics Companies (MEC), presented on the development of knowledge that the EMS company needs to gather from many sources, beginning with suppliers, to produce boards smoothly. Though the ideal situation would be to transfer knowledge to EMS providers so that they have 100% of what's needed to do a run on the first day, most likely that won't happen. Product knowledge transition starts with the customer. Traditionally, batches of knowledge are transferred from one stage to the next. Because of the need to reduce time-to-market, several steps need to be shortened; BOM completion, tooling release, supply chain setup, and material completion all need to have knowledge transferred earlier. Scholler developed flexible stage gates with sign-offs at various points. "If we're going to keep things moving, we've got to get out of the batch delivery stages," Scholler explained. He identified freeze gates incorporated on the critical path, an ever growing list of features frozen (not documents) to keep the project flowing. Package design, suppliers, equipment manufactures must all be part of the equation. Kevin Stone, director of business development, public safety, Kimball Electronics Group, presented some other useful tips for NPI, like the concurrent development model. This keeps production from being held up waiting on materials to come in. If an EMS provider is working with lean or Kan Ban, then it might takes a long time to line up everything early because items aren't on line already in back inventory. Responsibility has to be frozen at critical points to assign responsibility to know who will do what when in an EMS environment to build a product successfully on time and at budget.

Sue Mucha, author of Find It. Book It. Grow It. A Robust Process for Account Acquisition in Electronics Manufacturing Services, and president of Powell-Mucha Consulting, discussed outsourcing and good business relationships. Mucha's advice for the EMS/OEM community revolved around resources. What elements of producing an electronic assembly do you have resources for? What could you do better if you had ample support? "The reality is that even small EMS providers should be able to provide full support to their customers," Mucha explained. OEMs can justify the cost of "additional" services like lifecycle support and design for excellence (DfX) by outsourcing them to the more experienced and more efficient EMS provider. EMS providers already have established relationships with each link in the supply chain, making production times faster and sourcing smoother. As Scholler stated, a deliverable is whatever is of value to the customer. A feasibility audit isn't needed, but design for test is, for example. By outsourcing these aspects to the EMS provider, the OEM is "purchasing" resources without having to dedicate personnel or training to that element of their product, added Mucha.

Stone drew from his experience in engineering and high-reliability markets when he discussed the importance of a robust product launch. A new product introduction can be a new product on the market, a new product for that EMS provider, or even a new product for a particular facility of that EMS provider. Stone pointed out that sooner is always better with measures like design for test (DfT) and design for manufacturability (DfM). "Once you're past the PCB fabrication stage, it is almost too late for DfM/DfT," he asserted. Automation always is better than manual tasks when you're looking for DfM success.

Ross Clark, marketing manager, The Morey Corp., was SMT and IPC's main contact point for developing the keychain PCBA that IPC Midwest attendees took away from the A-Line. His role in orchestrating a cohesive line with all new machines from four different equipment suppliers shaped his presentation about role definition. We had to figure out how to talk to each other, between the machines and the operators, he explained. Time was the most important factor in preparing the product and the assembly line itself. Feature-richness and board complexity decisions were dictated by this important parameter, Clark explained, to ensure that we had a board built to specifications in time for the tradeshow. Awareness of your clients' particular needs and processes is crucial, agreed all of our presenters. Scholler talked about the critical components in a design including boundary scan to illustrate the EMS provider's middle-ground role from supply chain to customer. An assembly house doesn't deal with boundary scan because it's already built in. However, the EMS supplier needs to know how to use boundary scan because it can save on board space.

Mucha also explained the crucial nature of risk ownership. Documentation at each step in the manufacturing process can help prove liability for field failures, for instance. OEM investment in product testing can pay off in mitigated failure risk. Risk, waiting periods, and manual assembly tasks all should be eschewed during the design phase, Stone added. Streamlining the product launch early allows you to define production benchmarks and create accurate lead time expectations for customers. However liability is divvyed up, make sure the terms are clear before production begins. If both the OEM customer and the EMS provider are trying to "win" during contract negotiations, aiming for a large short-term profit, neither company is going to be happy with the relationship. Each presenter underscored this point. If open communication and clear terms are not part of the production agreement or contract, the customer relationship will be strained, possibly costly, and possibly will endanger the success of the product being assembled.

In my day-to-day work, I'm not designing and building electronic assemblies, though that is what's constantly on my mind. I jump at the chance to peek over the shoulders of line operators, board designers, project managers, and so on at OEMs and EMS providers. In planning and executing this A-Line and EMS Trends panel, I got the chance to virtually sit down at their desks, thumb through their contracts, listen in on their strategies. What did I learn? You can't build a good board without a good business working around you, and vice versa.

Communication is key in any industry. Being a media outlet for the electronics assembly community, we at SMT understand the vital role communication plays in moving industry forward, increasing productivity and technological capability, and getting your job done. Each EMS provider on our panel serves a different niche of the electronics market, be it prototype development for new products or ruggedized assemblies, etc. Each share a common goal — to develop deep, open, and continuous relationships with their customers so that both are profitable, productive, and expanding. If you're looking for the broadest trend in the EMS industry, there it is in a nutshell.

SMT will be chairing a second EMS panel, next year at APEX in Las Vegas. "Industry Cost Challenges: EMS Solutions," will present case histories and lessons learned to attack common problems, like ensuring component integrity while filling gaps in the supply chain, and downshifting products from high to lower volumes.

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