EMSNOW Launches New Feature: The OEM Perspective

EMSNOW is launching a new monthly feature to reflect the OEM perspective on EMS industry issues. This is an important perspective that is under-represented in the electronics manufacturing conversation, and we wish to give it a voice.

Knowing that there is sensitivity around any attribution of these opinions to a specific individual or company, we devised an anonymous method for gathering these OEM insights.  Each month EMSNOW will select a relevant industry issue and send it to a panel of OEM contacts who have agreed to share their opinions. We will not reveal the actual identities of any of our panelists. We will then publish the responses we receive and only edit out comments that could possibly identify them or their companies.

We invite any readers who work at an OEM who wish to participate on our panel to contact EMSNOW Publisher, Eric Miscoll (emiscoll@emsnow.com).

Here is the first installment in this new series:

August 2019 Issue:  Industry 4.0

The electronic manufacturing services (EMS) industry and its suppliers have been spending a lot of time and effort on Industry 4.0, defined as the digitalization of manufacturing and subsequent coordination and sharing of information among the various processes. There have been lofty promises about the efficiency improvements and cost savings, but ultimately this initiative is intended to benefit the electronic manufacturers and you, the OEM customers for whom they build products.

Question(s):  What is your opinion of this initiative? have you experienced its impact? What benefits would you hope to realize from it?

 

Responses:

We have not seen any impact.  Lots of talk at the corporate EMS level, but when it comes to actually impacting the front line and the business, we have not seen any fruit.  We can see where this would be helpful, but we are not seeing it become a reality.

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As a completely outsourced operation, we are initiating very little if anything on Industry 4.0 ourselves.

One area of focus for us is within our test solutions. Our complex product solutions require extensive and time-consuming test processes, so the engineering team is working to make processes more automated, more flexible to handle varying products, smaller to consume less sq. footage, and more intuitive so the product test operators can more quickly investigate and resolve issues.

In other areas, we rely heavily on our manufacturing partners. We meet regularly to review what enhancements they are introducing around process automation, robotics, advanced planning solutions, etc. The most obvious areas of improvement are visible every time we visit a manufacturing site and walk the production line. Another less visible, but still positive, example is the reduction in time it takes to provide data to us. It is clear that tools have replaced pure human effort and Excel.

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I have dealt with limited EMS factories and the products we have at the EMS have been relatively high mix, low volume. My experience is primarily with Chinese EMS. This may influence my responses compared to others.

I do not see digitalization of manufacturing data in my day-to-day interactions. I receive Excel spreadsheets and PowerPoint presentations for status communication. Day-to-day status and requests are primarily through email. We have SharePoint sites where higher-level EMS data is consolidated and presented to management, but it is not for manufacturing coordination and may or may not be digitally derived data. We have electronic document sharing and ECN’s that the EMS accesses through our portal.

With respect to sharing of data among the processes in the actual manufacturing areas, I have seen some improvements in this area, I am seeing more data entry at individual process steps with instructions, data entry, reference documents all being available real time at the station. I have seen some very strict management of material tracking/control but this is a slight upgrade of details from what has been done for many years. But much of the communications is still done in writing or in ERP even in the locations with data entry capability. Whether it is done manually or not I haven’t seen a great improvement in coordination in subsequent processes due to the use of this data. 

I feel this initiative is a tough one starting with the customers. Each customer has a different electronic data system that the EMS must interface with, and almost all of them tailored. The customers all request data reporting in a certain format and no EMS yet has presented me with a standardized report they would like to use that covers typical reporting information. And if I did accept their standardized report our company would have a specific format that would make it difficult to automatic data population into our systems.

As far as sharing the data among the subsequent processes, although we may build tens of thousands of units, our volumes, lifecycle, and margins probably do not warrant a significant investment in specific data digitalization and process design to best utilize that data. I think a larger volume product than what I work with may warrant more effort.

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This is a very recent initiative in one of our four major EMS providers, and there seems to be a lot of hype around the overall benefits of Industry 4.0, aka “Smarter Factory.”  My understanding is that this is the convergence of information technology with operational technology, with the expected outcome to be process optimization.  From the EMS perspective I believe this could be a revolution in their manufacturing, to be able to remove the dependency on human beings because the process monitoring and adjustments are intelligent enough to maintain quality processes that minimize defects caused by process variation, but I am also concerned that the EMS provider could be resource and/or financially constrained; and decide to only implement portions.

As a customer, we have been promised that this IS the next revolution in electronic assembly. It will drive down costs through optimization and control of the process, and the interaction between the systems will provide better traceability throughout the process for real time dashboard tracking.  If implemented properly, I also would expect that the process digitalization/optimization would facilitate in getting the labor hours properly quoted at the start of a project (no more surprises at the first production run). 

I am sure I am missing many other aspects, but I do believe the outcome of Industry 4.0 is going to be highly dependent on the resources and due diligence invested in the early stages by the EMS provider; understanding their weaknesses and ensuring those are captured in the development will be key to a successful implementation (as with any improvement plan).

For now, I plan to take a “wait and see” approach.