Industry forces enable the highest cutting-edge technology but can end up at odds over the day-to-day minutia of business.
It’s amazing the amount of creativity our industry has. Designers can take conceptual ideas and develop designs that, when combined with various components, turn those ideas into reality. I appreciate designers because they make product development look easy, as they think through what is needed vs. what is available.
Fabricators display creativity in a different way. They must understand chemistry, mechanical engineering, software manipulation, additive processes and removal processes, as well as thermal engineering – all the things needed for fabrication. They require creativity to continually move the bar higher, while utilizing equipment and materials that were not necessarily designed to produce the required results.
Material suppliers – chemical, laminate or something in between – are an equally creative bunch. Whether developing new and/or hybrid products, modifying existing materials to handle the reduced line/space, dimensional requirements and higher thermal requirements, or meeting the environmental standards thrust upon them by non-technical bureaucrats in Government, they demonstrate a keen ability to provide raw materials that are needed to produce the level of technology required to be competitive. Such efforts indeed require and demonstrate real creativity.
With so much creativity evident throughout the industry, we have never needed it as much as we do now. All too often, the creative forces that can enable the highest cutting-edge technology end up at odds over the day-to-day minutia of business, resulting in both short- and long-term suffering.
When the economy contracts, the pressure is to get orders and squeeze everyone for the best price. This type of squeeze play always reduces true value and mutually beneficial relationships to a level where no one wins and dividing lines get drawn. Many companies experienced some of that a few years ago when the tide toward Asia swept much of the demand for circuit boards away from the western shores. The first thing many did was start to beat up the supply base, seeking lower prices.
The response was to receive somewhat lower pricing at the expense of technical support and real product development, with many suppliers falling by the wayside. Other companies had to make the painful choice to either continue developing new products or providing the same level of technical support. Those who developed products but decreased support could only afford to market to large customers, most of which were in Asia. Those who did not develop product had little to support, and the combined result was an accelerated demise of the industry as we knew it.
Today, our industry in the West is very different than it was a decade ago. Equally, the industry in Asia is experiencing its first global downturn, causing many companies to rethink how they operate. It seems that we have great examples of what happens when we pit ourselves against other links in the supply chain. Maybe we need to step back and rethink how we treat each other– with an eye toward adding value and becoming stronger, more viable companies in a dynamic industry.
Fabricators and suppliers really need to get to know each other better. How can a supplier’s new products help a fabricator achieve higher technology that commands higher prices from more customers? Equally, how can fabricators introduce suppliers to designers who are pushing the envelope? Suppliers need to work with their “un-sales” departments, such as accounting, and remind them that it’s all about long-term relationship, and fabricators need to make their purchasing efforts more proactive for service and technical support – not just price. When the goal is providing value and building a relationship, individual order price and terms should never be the driver.
In addition, fabricators and suppliers need to work together to provide designers with better technical resources so the next, great design can be developed and brought to market with the best available technology in a cost-effective manner. All parties lose when interpersonal technical support and involvement are replaced with flat emails. If there is one aspect of service that our technology-driven industry seems to have forgotten, it’s how to be a solutions provider, working together across the entire supply chain.
Finally, most of the companies who are still in business are technologically competent companies. Customers need and expect technology, and the supply chain at all levels has creative, can-do people who shine when they are given a task that will lead to a new product or radically improved technology. So shouldn’t we all recommit ourselves to making sure that, in this economic downturn, we excel in satisfying our mutual customers’ needs by working together to enhance capability and providing true value to each other – as well as the industry? Maybe we will find that profits can and are earned by everyone in the supply chain when creatively developing the new, rather than by pointing fingers and dwelling on the old.
Peter Bigelow is president and CEO of IMI (www.imipcb.com); This email address is being protected from spambots. You need JavaScript enabled to view it..
