My article in the August issue of Circuits Assembly magazine looks at the question: Can market research help investment decisions?
Electronics manufacturing services (EMS) providers vary widely in the effort put into strategic planning. Some have dedicated strategic planning functions that develop internal reports and presentations on changing market dynamics and purchase market research for specific industries as part of the company’s overall strategic planning efforts. Others buy packaged market research studies or outsource specific research needs prior to developing strategic plans. Some companies center on trends within their internal customer and prospect base, focusing planning on the likely needs of the market they know best. And a few just go with the flow, reacting to customer requests but otherwise not engaging in any form of strategic planning.
Based on my experience, the right answer is somewhere in the middle. I’ve worked in companies so fixated on studying the market they grew more slowly than they would have had those resources been allocated to sales and marketing activities. In some cases, “studying things” actually became a way to avoid making hard decisions. I’ve also seen companies that failed to do any strategic planning surprised by market or technology shifts.
One thing to remember:
If you are not positioning your company, the market trends or your closest competitor will be.
You can read the full article here.
We’ll also be exploring strategic planning and EMS trends in much greater detail in PMCI’s half day workshop at SMTAI:
Identifying EMS Market Trends: Learn to Predict the Future and Help Your Company Lead the Pack
SMTA International, Rosemont, IL
Sunday, September 25 | 1:30pm — 5:00pm
Topics Covered Include:
- Typical cycles which repeat in the EMS industry
- Key events likely to trigger changes in demand
- Useful strategic planning tools
- Creating business models which can readily adapt to changing markets.
The early bird deadline for registration is Aug. 26. Register here.
My June Circuits Assembly article looks at EMS systems strategy.
One of the most positive trends I’ve seen in the electronics manufacturing services industry over the past five years is the permeation of ERP, shop-floor control and related systems that truly do let businesses work smarter, even in small, one-site companies. I see this as a huge positive because the complexity of information that must be managed on a day-to-day basis continues to grow. Read more here.
One of the interesting dynamics I’ve observed during my career in electronics manufacturing services is the evolution of sourcing strategy. In the ’80s, outsourcing was a risky decision that involved the highest level of the OEM organization. Final decisions looked not only at the immediate need, but at the ability of an EMS provider to support the business needs longer term. Today, outsourcing is more of a commodity decision, and sourcing teams are often staffed by people with far less knowledge of the manufacturing process or the softer issues in the total cost equation. My April 2016 Circuits Assembly article focuses on way to achieve lowest total cost.
Over the years I’ve noticed those new to program management often find negotiating with customers challenging. So, in my February 2016 Circuits Assembly article, I highlighted strategies for improving negotiation outcomes.
It is important to understand the role of the program manager has two parts: First, a program manager is the face of the company to their customers. Second, the program manager is charged with keeping the program on track within the contractor’s business model. In some cases, this role may include managing profitability. In other cases, it is simply keeping program metrics in line with the contractor’s model.
The reality is that if the program doesn’t make a profit or becomes a nightmare that causes chaos in materials or the production area, that customer most likely will be disappointed. Addressing project issues early ultimately contributes to increased customer satisfaction, smoother production flow and greater program profitability. The article lists seven strategies to improve negotiations.
Strategic vs. tactical: which makes more sense?
EMS program management models can vary by provider or even by facility or program team. No one model is ideal for all account types. However, typically program managers can be divided into two groups: tactical and strategic. Tactical PMs focus more on day-to-day activities, while strategic PMs tend to take more of a leadership role relative to their accounts. While many organizations consciously make the decision as to whether their PMs should be tactical or strategic, in some cases it just evolves one way or the other. The downside to lack of defined program management focus is the lines of authority and responsibility can become blurred. In my December 2015 Circuits Assembly article, I looked at both models and discuss the drivers that make one or the other appropriate.
Several months ago, I attended a Science, Technology, Engineering and Mathematics (STEM) event in El Paso, TX. Two of my electronics manufacturing services clients provided me with video, photos and sample printed circuit boards to use in a display about manufacturing. IPC and SMTA also provided materials. My October 2015 article in Circuits Assembly asks the question: Are manufacturers engaged enough?
This is an area I continue to question. With the cost of college, I honestly believe that it is very important for students to walk into to college with a good idea of the job options related to their chosen degree program and a roadmap for internships and/or co-op programs that can help them build a network during college that leads to job offers once they get a degree. Not everyone agrees with me. The educators I’ve discussed this with tend to feel that students should not be this focused. One even went so far as to say that it isn’t the university’s role to train students for private industry. To me, that shows the magnitude of the disconnect. My thoughts on focus and employer engagement weren’t that a university should be training people to the whims of employers, but that students paying $40-$60K for a degree should have a reasonable expectation that they were leaving college with marketable job skills and hopefully a path to a job that doesn’t involve a hairnet and French fries.
What do you think? Feel free to leave comments.