Tag Archives: outsourcing

Top 5 Things to Know When Moving from Hand Assembly to Robotic Assembly

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A lot of factors go into the decision to hand build or outsource circuit boards. I hand build my own sometimes, simply because I enjoy the challenge. Of course most of the projects I design are for my own use, so timeliness isn’t that important. When I do design something that will go out to a customer, like my electronic business card holder, I will send the board through our shop. In those cases, quality is important, as is delivery, and the quantity is often too high to hand build. Machine building also allows me to use smaller and more complex parts. 

That same decision — hand build or outsource — takes place in the heads of designers all over the country. When the decision is to outsource, there are a few important things to consider. Some things that work fine when hand soldering may stand in the way of quality, repeatability, and reliability when machine assembling.

Here are five of the most important considerations when changing from hand-built to outsourced at a place like Screaming Circuits

1. Use solder mask and silk screen. A good solder joint needs the right amount of solder in the right place. Solder will tend to flow down bare copper, bleeding outside of the area it belongs, and down exposed copper traces and vias.

The main purpose of solder mask is to keep the solder where it belongs. It also protects the traces, but that’s a longevity issue. Solder bleeding is a manufacturing and reliability issue. This isn’t a problem when hand soldering. In fact, it can even work to your advantage when hand-soldering really small parts. It gives you more room for your soldering iron to hit metal.

Not so with solder paste and machine assembly. Use solder mask.

2. Avoid the pseudo panel. Keeping small boards in a panel is the recommended best practice in the manufacturing industry. We appreciate it and, while not always necessary, it can reduce your costs. We sometimes see what we call a “pseudo panel.” This is a board where multiples of the board are put in the same PCB, like a panel, but unlike a panel, the boards don’t have routing or V-score between them. Sometimes the designer will put a bunch of vias to outline the board, or just ask that we use a band saw to separate them.

That’s a time-consuming, expensive and potentially damaging process. The vibration of the saw can crack solder joints, and, you’re unlikely to get boards that are all the same size. Have small boards panelized by your board house.

3. Family panel (pseudo or not). Similar to the pseudo panel is the family panel. A family panel is a case where a project is made up of several different PCBs, and they are all laid out together, as though they are one design. If the board isn’t routed between the designs, you’ll have the pseudo panel problem described above.

The bigger problem, though, comes with reference designators. We typically see family panels with duplicate reference designators. Each design, for example, will have its own C1, R1, Q1, etc. We use the reference designators as position identifiers: If you have three different parts labeled R5, our machine programmers will have a problem with it. It’s even worse if the values differ; on one design, C1 is a 0.1uf capacitor, while on another design, it’s a 22pf cap.

If you’re making a family panel, give each and every placement a different reference designator. One way would be to us extra digits. For example on one design on the family panel could have C100, C101, C102… The next would be C200, C201, C203, and so on.

And don’t forget the routing or V-score between the designs.

4. QFN — hole  in the middle. A common technique in the hand soldering world, for QFNs and other parts with thermal pads underneath, is to put a big via in the middle of the center pad. By doing so, you can stick a soldering iron and some solder down through the hole and get a good solder connection on the bottom pad.

This doesn’t work with machine assembly. the solder paste will flow down and out the hole in the reflow oven. You’ll end up with a poor connection (or no connection) to the thermal pad, and solder slop on the back side of the board.

5. Parts and the bill of materials (BoM). When I build my hobby projects, I often get a bit carefree with the bill of materials. It’s not good practice, but I do. I’ll put a part in the BoM that I used before, and not check to see it’s still in stock. I’ll put parts in the BoM with just the values and not any part numbers. Things of that sort require tribal knowledge, which only the designer has.

When building, sometimes I’ll just grab a part that’s close. If I need an 0805 1uf, 10V capacitor, I can grab a 16V, 25CV, etc. I can even make an 0603 part work. You as the designer may know that something close will work, but an outside house can’t know. You need to tell them exactly what the part is.

Before sending anything through our shop, I do clean up the BoM. In order for us, or any manufacturer, to build the boards, the BoM needs:

  • A unique reference designator for each part placement.
  • The quantity of each part used on the board.
  • The manufacturer.
  • The manufacturer’s part number.
  • DigiKey part numbers can be used as well.

Here’s our website page explaining the BoM format in more detail.

The transition from hand building to outsourced machine building can be an intimidating one. But, with a few considerations, it can be an easy and rewarding transition.

Duane Benson
Put the right part in
Put the wrong part out
Put the right part in
But please don’t shake it all about

blog.screamingcircuits.com

H-1B Free?

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Those in favor of lifting limits on the US government H-1B visas, which allow workers from other countries to take jobs in the US, might want to read this alternate view.

Tech companies in particular say the program is essential to filling critical job openings requiring math and science acumen that too few Americans have. Critics fire back that the program turns the foreign citizens into indentured servants — they generally receive significantly lower pay relative to their American counterparts and no benefits, and have no opportunity to leave the sponsor company for another (better) job.

There’s also commentary from the author of the H-1B visa program, too, who says it has evolved into something far afield from what was originally envisioned.

 

No Rest for EMS

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Look out Apple — Foxconn is encroaching on your turf.

The company, which already boasts a chain of retail outlets, plans to expand into everything from software apps to a broadband satellite network. Much like Verizon, Comcast and others in the US, the EMS firm is working with local municipalities to build out the network.

Moreover, it has big plans to develop apps for smartphones, tablets and TV.

EMS companies don’t stand still. They can’t make money making solder joints. OEMs that want to protect their future should reconsider the extent to which they should be enabling  their suppliers.

Supply Chain Shakeup is Here at Last

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We’ve often wondered whether the roughly 25 years of serious electronics outsourcing has been deleterious for OEMs. Certainly OEMs that have come to rely heavily on contract manufacturers now lack much of the know-how that comes with in-house product build. That’s a subtle change, and one that’s hard to measure directly.

But I’m getting at something more concrete. Indeed, is it possible the broad-based philosophy to “outsource everything” has not only led to a loss of manufacturing development but also actually cost more than had OEMs maintained their internal production capabilities?

Some OEMs are finding out. The ODM model, not so long ago the envy of the contract manufacturing world because of its higher margins, is being torn apart. Customers are pushing for additional services and in the process driving up internal ODM costs.

The flooding in Thailand, the earthquake and subsequent tsunami in Japan, the unrest in the Tunisia – all these unpredictable events are forcing OEMs to look ever more closely at their ever-more-fragile supply chains. The decimation of the disk drive market in Thailand last fall really woke everyone up.

Now, industry leading mid-market OEMs have already begun restructuring their supply chains, disengaging and reworking their manufacturing agreements with ODMs, and reconsidering regionalization builds (aka reshoring). This is a multi-step process that will take several years, says Charlie Barnhart, but it also is “a very definitive trend.”

Barnhart made his comments the Outsourcing Navigator Council meeting May 30 at Teradyne in suburban Boston. (I was fortunate to be invited to moderate a panel on EMS after-market service trends; more on that later.) Barnhart is a bit of an industry gadfly, but he’s provocative and willing to buck the conventional wisdom when his data (and his gut) tell him so. If he’s right, expect upheaval, and expect it soon.

We can’t say we haven’t been expecting this.

Chatting with Charlie

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Be sure to tune in to Charlie Barnhart’s chat on outsourcing models and trends later today at PCB Chat.

Charlie’s long been known for his scrupulous analysis and willingness to slay the sacred cows of contract manufacturing. He’s sure to offer some entertaining and informative answers to your questions.

The chat takes place today from 2 to 3 EST. To attend, click here.

Just What is ‘Core Competency,’ Anyway?

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I want to call attention to this long overdue piece by Forbes’ columnist Steve Denning.

Under the tantalizing headline, “Why Amazon Can’t Make a Kindle in the USA,” Denning makes the case that management, not manufacturing, is to blame, for its rather thoughtless, follow-the-herd mentality (my words, not his).

Case in point: Dell, which little by little gave more and more of its PC manufacturing and  design to Asustek, until the day came when Asustek had developed all the in-house expertise it needed to become an OEM. It no longer needed Dell. And while one could say Dell (whom I am using as a proxy here, as this scenario applies to scores of Western businesses) would have been eaten up by competition sooner or later anyway, the fact is one of its major suppliers — Foxconn — practically prints money, while Dell and fellow PC outsourcer HP look for ways to escape that low-margin business.

For nearly two decades, the EMS industry has sold the OEMs on the idea that they should outsource their lower-margin activities, while simultaneously refuting any suggestion that by doing so OEMs were setting themselves up to be replaced by their own suppliers. “We’re not in the business of ____,” was the EMS refrain. Well, they weren’t until they were. And then it was too late for OEMs to do anything about it.

Unlike populists like Lou Dobbs who shout that the loss of manufacturing must have a political solution, yet fail to consider the intricacies of what they propose, Denning takes a more nuanced approach. (I’ll add my two cents: If Wall Street could manage your business, why aren’t they?)

It’s worth your time to read.

Inside EMS

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I attended a fascinating conference yesterday on the state of electronics outsourcing and supply chain management.

Set on the campus of Tellabs in the Chicago suburbs and produced by Charlie Barnhart Associates, speakers and attendees patiently dissected current trends and needs.

So as not to inhibit discussion, I promised not to reveal any specific remarks or details prior without getting the individual speaker’s signoff, so for now I will stick to generalities.

Attending were representatives from about 10 EMS companies and a like number of OEMs, some from Fortune 100 companies. There were also various analysts and other talking heads/pundits. I was the only media person in attendance.

Topics ranged from the concrete to the speculative. Tellabs spoke at length on how and why the telecom gear maker decided to outsource its electronics assembly, and was refreshingly upfront not only about the pros and cons but about the mistakes it made along the way.

Researcher Matt Chanoff noted the startling success of the Apple iPad and wondered whether the reason it has managed to capture a 95% share of the tablet market despite more than 80 competing products has to do more with the “ecology” of Apple vs. the form, fit or function of the iPad itself. He also pointed to a few distinct trends in the electronics design and manufacturing space, noting an unprecedented product platform commoditization is underway, while at the same time a newish breed of hobbyists (“prosumers”) has emerged and created a niche market for very expensive, semi-retro (read: electromechanical) products like cameras.

CEO Cary Wood laid out the turnaround of 118-year-old Sparton, which came thisclose to bankruptcy before righting the ship. The current metrics are an impressive display of refocusing and rebalancing. He said that the bulk of Sparton’s EMS customers two years ago were money losers, and Sparton had to either cancel the programs or renegotiate terms. But the bigger issue was convincing the sales team to jettison bad customers. Wood was forthcoming about the specific policies they put into place, including standardizing templates for pricing and quoting, and installing a sales and incentive program based on profits. He also noted that given Sparton’s exceptionally long history in Michigan, they effectively had to relocate the headquarters because they were the big fish in that small pond, and after all the local layoffs and shutdowns, they would have been tarred and feathered. He also said they made the decision to separate HQ from a manufacturing site so as not to get too emotionally attached to a particular business.

Time and again, OEMs and EMS companies said it was advantageous for competitors to place programs with a single EMS and that IP concerns didn’t really factor into the equation. The EMS companies said that OEM competitors are attracted by the knowledge that the EMS knows how to build products for the target market and that the EMS would also know what the appropriate prices would be. (That latter point was made several times.) In short, IP concerns take a backseat to the hope that the EMS would ensure the build price remained consistent with their competitors’ products (which also hints that OEMs accept the commodity nature of most of their products).

Another speaker asserted that no EMS is too big to fail, Flextronics and Foxconn included. He pointed to the disruption such an event would have on supply chains, pricing and capacity.

The good folks at CBA put me to work moderating a panel made up of two OEMs (Tellabs and Eaton) and three EMS companies of varying size and geographical reach (Plexus, Morey and Creation Technologies). I’ll have more on that in a bit.

 

 

Outsourced Out of a Future?

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Alert! Self-serving Content Ahead!

I suppose I’m supposed to be self-serving now and then. I mean, I don’t personally design and build things for a living. I do that for fun and dim hopes of robot world domination. These days, I tell people about things for a living so that makes it my job to be mostly self-serving (“self” being defined as “my company”). But self-serving isn’t always bad. I couldn’t get gas for my car here in Oregon without being self-serving. I could get hamburgers though, so I’ll have to conclude that it’s a 50-50 proposition.

We understand outsourcing here at Screaming Circuits. That’s what we do — take people’s outsourced prototype and short-run production assembly work. Being located in Canby, Oregon, USA, we see both sides of the outsourcing discussion. As I said, on the one hand, we do assembly for other people. On the other hand, being a North American manufacturing company, we’ve seen a lot of work go offshore.

Not that I’m against things not in the US. I firmly believe that most of this country’s success is due to the fact that we’re from here, there and all over the world. But, I do want to have a job and I want my friends and family to have a job. We have to be worth something in this country and the rampant pace of off-shoring sometimes makes me wonder if we’re just deluding ourselves in that regard.

The prompt for this post is this article in the Los Angeles Times about Boeing’s outsourcing in the 787 Dreamliner program. The quick summary of the article is to speculate that Boeing went way too far in their outsourcing and have put at risk not only the financial success of the program, but also the company’s future engineering prowess.

Now, here’s the self-serving part. The article outlines how they went wrong by over-outsourcing, but it also points to the value of specialty companies like Screaming Circuits:

That’s not to say that outsourcing never makes sense — it’s a good way to make use of the precision skills of specialty manufacturers, which would be costly to duplicate.

That’s us. We specialize in prototypes and small volumes. We specialize in new and difficult component package sizes. We see such a variety of different types of designs here in our shop that we get good at things like QFNs and micro BGAs sooner than anyone else. (Hyperbole, perhaps, but I do believe it none the less). We’ve built things that go under water, up into space and everywhere in between. We don’t specialize in one or a few specific vertical markets, like medical or consumer, we specialize in the prototype phase of the development program across virtually all market categories.

So, outsourcing: I’m in favor of intelligent outsourcing. My advice to you: Outsource where it make sense. Don’t outsource where it doesn’t. Look at the true cost of such decisions, not just the surface image. Keep some value add in your company and don’t just become a marketing shell.

Duane Benson
Time to make my oatmeal.
One

http://blog.screamingcircuits.com/