Invest or Cut Back? Print E-mail
Written by Susan Mucha   
Tuesday, 31 January 2012 22:46



In a flat environment, a multitude of moves can help the bottom line.

The uncertainty of the economy is having mixed results on the electronics manufacturing services (EMS) industry. While the economy is picking up slightly and there is some growth, most companies aren’t coming off record years. In this “leveled out” environment, some companies are opting to significantly cut costs, while others see this as the time to make investments that they seldom have time for when demand is at its highest.

For those on the fence, it’s a good time to discuss areas of potential organizational improvement:

Quality systems roadmap. If a drop in demand has created additional staff time, this may be a good time to do a gap analysis between existing quality system registrations such as ISO 9001 and industry-specific systems such as ISO 13485 or AS9100. Understanding what would be necessary to add to the system is the first step in determining if it is in the budget.

Staff enhancements. Recessions put both good and mediocre workers on the street. Companies have made some deep cuts, and good talent is available. This is a good time to look for hard-to-find engineers, program managers and experienced sales team members.

Organizational process improvement. Grown by acquisition, experienced a change in the complexity of projects served or seen a large sales increase over the past couple years? This may be the time to evaluate organizational processes that aren’t working efficiently. In some cases, this may be simply ensuring that processes are standardized among multiple facilities. Program management is one area that often develops facility-specific flavors. This may also be the time to look at implementing Lean manufacturing or doing value-stream analysis.

Train. Skills training can be difficult to schedule when demand is at its peak. Analyze your organization for weak spots that could benefit from focused training.

Look for stimulus funds. Like it or not, politicians have thrown a lot of money around, and some of that is focused on job-creation initiatives. Additionally, there is a lot of empty square footage in many locations. Analyze local economic development, job creation and training programs to determine if funds are available to support facility expansion, hiring, equipment upgrades/additions or training initiatives, if those activities make sense for your business.

Analyze accounts. One of the biggest challenges for program managers is finding time to balance account strategic planning with day-to-day tactical issues. Implement an account analysis framework and study each major account for potential issues and growth opportunities. If any account contacts have moved to other companies, use tools like LinkedIn to reestablish contact and see if potential business is available.

Evaluate branding strategy. Rebranding efforts can carry significant cost, depending on scale and suppliers used. However, a total rebranding isn’t always necessary. The important element to analyze is whether tools such as your website, brochures or slide presentations accurately reflect the company’s capabilities and advantages. If things have changed, this may be a great time to update. Remember, if you are not positioning your company, your
competitors will be.

Survey customers. What would your customers like to see improve? Whether you hire a firm, deploy a web-based survey in-house, or simply take a few key customers to lunch, asking “what could we do to improve the way our company addresses your needs” is a good way to assess potential areas for improvements. Customers appreciate being asked for their opinions. However, be sure to provide all customers surveyed with a report that discusses what actions are being taken as a result of the survey, even if not all suggestions are adopted.

Analyze your supply chain. Can you team with suppliers to offer bundled services or enhance existing services? Find ways to tap your supply chain for expertise, engineering assistance or better support of customer requirements.

These represent just a few of the ways I’ve seen EMS providers investing during these uncertain economic times. The benefit of these additional activities is threefold. First, it ensures that team members stay productive, even if workload has dropped. (I know for many in this industry, a drop in workload means going from 60 to 40 hr./week.) Second, it reinforces that there is an organizational commitment to improving business, which helps retain people concerned about job security. Finally, it results in improvements that better position a company to grow.

Susan Mucha is president of Powell-Mucha Consulting Inc. (powell-muchaconsulting.com), and author of Find It. Book It. Grow It. A Robust Process for Account Acquisition in Electronics Manufacturing Services; This e-mail address is being protected from spambots. You need JavaScript enabled to view it .

Last Updated on Wednesday, 01 February 2012 18:10
 

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