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The start of an outsourcing partnership is an exciting time for an original equipment manufacturer (OEM), but it's also one that can be daunting. However much you've prepared for that big moment when you hand over responsibility for part or all of your manufacturing operation to your chosen electronics manufacturing services (EMS) provider, it's still normal to question if you are making the right decision.
The best way to dispel these feelings is to try and find out as much as you can about what will happen during the early stages of the outsourcing relationship.
During this period, your EMS partner should be focused on creating a stable supply chain and manufacturing environment. It's unlikely that they will want to change too many things at once; instead, they will be seeking to build confidence and mitigate risk.
In this article, we explore five key areas that you and your chosen EMS partner should focus on during the initial months.
At the heart of a successful outsourcing relationship lies a strong and healthy partnership between you and your chosen EMS provider. It's essential that the lines of communication are clear and open and that both parties are on the same page and working towards the same goals.
To achieve this, your EMS partner should provide you with a dedicated account manager, even before you place your first order. This individual will already have in-depth knowledge of your organization and products, having been involved in preparing your initial quote.
With their wealth of knowledge, your account manager will manage your account on a day-to-day basis. They will be responsible for quoting new business and managing your existing projects through the shop floor. They will seek to organize regular business review meetings with you, create bespoke customer service reports, and ensure that your original outsourcing objectives are being met by making sure that any critical issues, such as the progress of a new product launch, are addressed and communicated in a timely manner.
With this relationship firmly in place, you can rest assured that you have a reliable and regular point of contact for any questions you might have once your first order is underway.
Supply Chain Set-up
By the time you sign a contract with your EMS supplier, they should already have a good understanding of your supply chain, as this will have formed the basis of the quote you received for your outsourcing requirements. Your partner will have spent time talking to and auditing your suppliers, creating part numbers and listing bills of materials (BOMs) on their system, to give you as accurate a quote as possible.
In the long run, it often makes sense to hand over complete control of your supply chain to your EMS provider. This approach delivers many benefits, such as filling in any grey areas over who owns what and enabling your EMS supplier to deal with any issues that arise internally. It also takes away all the overheads associated with procurement and materials handling and, perhaps most importantly, frees up your time, allowing you to focus solely on designing, marketing and selling your products.
However, you may not want to go down this route immediately – it requires a high degree of trust, which naturally accumulates over time. Therefore, you might decide to keep some control over your supply chain and continue to buy certain items from your incumbent suppliers before "free issuing" them to your assembly partner for manufacturing. Alternatively, it is possible to nominate your preferred suppliers to your EMS partner, who will then continue to work directly with them.
Whichever route you decide to take it must be right for you and allow you to achieve your original outsourcing objectives.
Once goods start to arrive, the EMS logistics team will inspect each item against their internal standards and procedures. Broadly speaking material inspection can be divided into two categories:
1. Electronic components
2. Drawn items/electro-mechanical parts
Electronic components will be subjected to both a cosmetic and dimensional inspection. The EMS provider will check the part has been delivered in the right quantity and that the correct revision has been shipped. They will check that the paperwork, labels, part markings, date codes and external packaging all match their expectations.
In the majority of cases, the EMS provider will buy direct from the manufacturer or a franchised distributor. If, for any reason, they need to buy your parts outside of the franchised network (obsolescence, allocation, etc.), they must have robust processes and procedures in place to verify the authenticity of the devices they are buying on your behalf.
The best EMS providers will have invested in specialist inspection equipment on site so they are able to carry out further checks on your behalf which could include:
- Permanency testing to verify components have not been remarked.
- Scrape testing to verify components have not been ‘blacktopped’.
- Solderability testing to verify the component leads are not corroded or contaminated preventing them to solder correctly during the production phase.
- SENTRY electrical testing which can help detect missing or incorrect dies, lack of bond wires, inaccurate pin outs and pin impedance variations.
When it comes to drawn items/electro-mechanical parts the EMS logistics team will again check the basics (quantity delivered, paperwork, external packaging etc.) but then inspect the parts against their drawings. Quite often Engineering and QA teams will also be involved in this process to support the logistics team with checking that the finish, material, tolerances and dimensions all match those listed on the drawings.
Aesthetics can often be subjective so it is important that you and your EMS partner agree on cosmetic standards early on to avoid time consuming and costly material delays. Supplier packaging may also need consideration to avoid parts becoming damaged during transit. A good EMS partner will work with their own suppliers to ensure that any parts they order are delivered to them error free and if this means working together to create custom packaging solutions, this is what they will do.
To produce an initial quote, your EMS provider will require a build pack from you, which should include all the data pertaining to your product. At the quote stage, small gaps in data can usually be accommodated and the EMS provider can often still quote making certain assumptions or caveats. However, when it comes to the build process itself, these gaps will need to be filled. A lack of data, or incorrect data, can impact production and delivery times, so it is important to be thorough and check that your build pack is complete and verified.