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An Alternative Approach to Vertical Integration in Manufacturing
July 13, 2017 | Richard Kelly, MC AssemblyEstimated reading time: 5 minutes
When you now apply the same model to the high-mix/low-volume (HMLV) manufacturing environment, directionally, the results become dismal. This is the environment that MC Assembly matriculates as does most EMS mid-tier companies. Strict dedication of capital-intensive manufacturing machinery is impossible.
Figure 6: A worker can be seen inspecting the final boards for quality.
Our customer base values flexibility and responsiveness. They look for EMS partners instead of EMS suppliers and seek supply chain solutions that integrates their consumption with the EMS partner’s production.
Vertical Integration in Mid-tiered EMS
Curiously, vertical integration has seeped further and further into the EMS world, even to some mid-tiered EMS companies. Not understanding their business plans, it is difficult to judge this move as right or wrong.
Instead of trying to be the best in every manufacturing technology, it’s preferable to develop suppliers who are best-in-class for their respective technology. Even within specific technology groupings, differentiations such as press size, cosmetic capability, labor costs, and site locations are factors that differentiate one from another. Ultimately, this “virtual” integration may probably be a better solution for the mid-tier EMS companies versus a “vertical” integration solution.
This article was originally published in the July 2017 issue of SMT Magazine.
Page 3 of 3Suggested Items
I-Connect007 Editor’s Choice: Five Must-Reads for the Week
05/17/2024 | Andy Shaughnessy, Design007 MagazineThis week, trade shows are at the top of our feed, with our coverage of the Del Mar Electronics and Manufacturing Show and IPC APEX EXPO. These two longtime events are almost polar opposites in size and scope, but Del Mar seems to be expanding from its roots as a “neighborhood gathering” with its move into the Del Mar Fairgrounds. The Del Mar show always has a good “buzz factor,” which is something you can’t buy.
Real Time with… IPC APEX EXPO 2024: Insulectro on Attracting Young Talent to the Electronics Manufacturing Industry
05/16/2024 | Real Time with...IPC APEX EXPOInsulectro's Doug Gotelli and Mitchell Benson explore the challenges of drawing young talent into the electronics manufacturing industry. They underscore the significance of manufacturing and the urgency of tackling the workforce shortage. They also discuss internship programs, the industry's resilience amid the pandemic, and the rewarding experiences of working in this sector.
Siemens, Foxconn Team Up to Optimize Forward-thinking Manufacturing
05/16/2024 | FoxconnSiemens AG, a leading technology company, and Hon Hai Technology Group (Foxconn), the world’s largest electronics manufacturer, have signed a memorandum of understanding (MoU) to drive digital transformation and sustainability in smart manufacturing platforms.
TRI Opens New Manufacturing Facility
05/16/2024 | TRITest Research, Inc. (TRI), the leading test and inspection systems provider for the electronics manufacturing industry, announced that it has opened a state-of-the-art R&D and manufacturing facility.
SEMICON West 2024 to Spotlight U.S. Chip Industry Investments, Supply Chain Resilience, Talent, and Global Growth and Innovation
05/15/2024 | SEMISEMICON West 2024 will gather industry experts and leaders July 9-11 at the Moscone Center in San Francisco for insights into the latest trends and innovations in sustainability, supply chain management, workforce development and other critical industry issues.