Did shortages of semiconductors and electronic components cause problems for your company in 2022? How have you managed these supply chain issues in 2023? In an opinion piece that appeared in Circuitnet, Andrew Williams, Engineering Manager at PRIDE Industries, explains how design for manufacturability (DFM) can help electronics companies overcome these challenges.
There are several factors that companies typically consider when vetting a potential supplier of electronics manufacturing services (EMS), including: the supplier’s production capacity, the sophistication of its distribution and tracking systems, and its network of component suppliers. But if you want to get the most out of your EMS provider, you would do well to consider one other factor—the experience of the provider’s manufacturing engineers.
Partnering with an EMS provider that has its own engineering team will allow your company to temporarily expand its engineering resources. Doing so yields four significant advantages, allowing your company to:
The main reason you want your EMS provider to have qualified engineers is to boost your company’s engineering expertise. Maybe your latest product is a little outside your wheelhouse, but you don’t want to hire internal expertise just for that product. Maybe designing your product is taking longer than you expected, and you need a fresh pair of engineering eyes on it. Or maybe you’re busy with other projects and can’t give this product the engineering attention it deserves.
In each of these instances, it makes sense to bring on additional expertise. Because the engineers at your EMS provider work on multiple projects, they’ve likely already dealt with whatever challenges you’re facing. They have experience across an array of industries and know a few tricks from other products that can help ensure your product’s success.
As we move into the era of the smart factory, the engineering team your EMS provider offers will become more important to the success of your product.
Perhaps the most important reason to tap the expertise of your provider’s engineers is to make sure that your product’s design is as functional and cost-effective as possible. That means looking beyond the product itself and scrutinizing every step of the manufacturing process.
While raw materials can be expensive, much of your product’s cost comes from labor. That’s why a review of your product’s prototype—through a DFM (design for manufacturability) lens—can yield significant savings in the long term.
An experienced engineer, one that has helped develop hundreds of products, can help you optimize your product’s design so that it can be made as quickly and inexpensively as possible, without sacrificing performance or quality. These engineers know how to streamline both machine and hand-processed operations and can ensure compliance with regulations. And if your design uses custom components, your provider’s engineers may be able to recommend less expensive, off-the-shelf substitutes.
A DFM review is especially important now that supply chains aren’t as predictable as they once were. In short, scrutinizing your product design with manufacturability in mind:
Working with electronics engineers who have deep manufacturing experience ensures that your product’s manufacture will be as efficient as possible. A strong EMS provider should be able to review your data package and create the fastest, least labor-intensive process. These engineers can help you simplify your bill of materials, clean up your manufacturing line, and leverage technology.
While DFM is of primary importance, there are other issues to keep in mind when it comes to your product’s design. An experienced engineer can help you create a product design that enables easy testing—ensuring high quality and saving you money down the manufacturing line.
And if you have to modify an existing product’s design—perhaps to account for changing consumer demands—working with your manufacturer’s engineers will let you update your design in a way that minimizes the changes needed to the manufacturing process.
Is sustainability a priority for your company? Experienced contract manufacturing engineers are used to planning the entire lifecycle of the product. They can help you design products that use less electricity, for example, or that use lower VOC conformal coatings. They can also make it easier to extract useful components for resale at the end of the product’s lifecycle—an increasingly popular secondary revenue stream for electronics manufacturers.
As manufacturing processes become more complex, and we move into the era of the smart factory, the engineering team your EMS provider offers will become more important to the success of your product. Greater automation means greater complexity. An engineer can help design a manufacturing process that leverages the latest technology, like the Industrial Internet of Things, autonomous robots, AI, and advanced materials. Engineers know how to interpret the data gathered from the IIoT, and can move quickly to optimize the manufacturing process to maximize efficiency.
But no matter how simple or complex your product is, your EMS provider’s engineers should listen to you. Their priority should be to design a process that helps you achieve your priorities, whether performance, sustainability, or cost. A strong engineering team will be able to help you balance your priorities so that you can achieve your manufacturing goals.
To make sure your EMS provider has the skill set to truly help you, check to see if they have earned appropriate certifications related to your needs. For example, do their team members have SMT Process Engineer certification from SMTA? This elite certification signifies that the engineer you are working with can ensure that your complex PCB assembly fits with the best manufacturing process. SMTA certification also means that your contract engineers know how to modify product designs when requirements change and can resolve production issues quickly.
SMTA-certified engineers are also able to clearly explain design constraints and tradeoffs, making it easy for you to determine which product features are cost-effective and which won’t pay for themselves.
Once you have chosen a contract EMS provider with the expertise you need, how do you work with their engineers to get the most from the partnership? Here are a few points to keep in mind to maximize your return:
Following these simple rules will ensure a strong working partnership between your company’s engineers and your supplier’s engineering team. And building a partnership brings advantages that are as significant as they are hard to measure. After all, a supplier merely delivers a service. But a partner looks out for your interests.
Electronics manufacturing has undergone multiple changes over the past few decades. Technologies like 3D printing, computer-aided design, and the Industrial Internet of Things (IIOT) have changed the factory floor considerably in just the past twenty years. But in many ways, the factory still resembles its 20th-century predecessor. That may be about to change, however, because a confluence of new technologies is coming together to create a whole new way to make electronics—by manufacturing in space.
Even though it will be years before we see commercial manufacturing in space, researchers and corporate executives have been planning for space-based manufacturing since the sixties. In a way, these visionaries have been waiting for technology to catch up to their aspirations, and that’s finally happening.
Computing power, for example, has grown exponentially since the mid-20th century, leading to advances in AI, robotics, and communications. In addition, launch costs have fallen over the past few decades, and the trend is continuing. There are still a few technological roadblocks to overcome, but as a recent McKinsey analysis points out, we are nearing the point at which space-based R&D and manufacturing become a reality.
For the aerospace and defense industries, the advantages of manufacturing and assembling products in space are obvious. Space shuttles and other structures, such as labs, can take on diverse shapes if they don’t have to be launched from Earth’s surface. They can be made of thinner material as well. And they can be much bigger than anything that’s been built before.
Already, China is investigating a proposal to create ultra-large spacecraft that are half a mile long. These behemoths would be too large and too heavy to launch from Earth’s surface. Instead, the ship’s components would be sent up into space in a series of launches, and then the pieces would be assembled in orbit—like giant space Legos.
But creating large ships and space stations is just the beginning. Organizations like NASA want to do more than merely assemble components in space.
While it will take years to have factories in space, the benefits of these manufacturing innovations will be here a lot sooner.
NASA officials have concluded that in order to undertake long-duration exploration missions, they must adopt a new paradigm for the construction and maintenance of space architectures. Their catchphrase for this new approach is “Make it, don’t take it.” The goal is to develop processes that allow for the on-demand fabrication and repair of critical systems and habitats. This would not only lower launch costs, but also reduce risks (and expenses) by decreasing the reliance on spare parts and lessening the need for component redundancy.
To that end, NASA is supporting the development of technologies that further its in-space manufacturing (ISM) initiative. These technologies include Zero-G 3D printers and recyclers, both of which have applications in electronics manufacturing. The agency’s multi-material FabLab, for example, is currently developing an additive process for 3D printing a variety of metals. NASA’s goal is to enable the manufacturing of critical components—including embedded electronics—that make long-duration space missions possible.
Another essential for long-duration space flights is the ability to recycle and refabricate materials. One of NASA’s solutions to this challenge is ERASMUS, a next-generation device that integrates a 3D printer with a recycler and a sterilizer to create a closed-loop system that turns plastic waste into food- and medical-grade filaments. These filaments can then be fed to a 3D printer to create plastic implements for a variety of purposes.
Once these technologies are fully developed, they will not only enable exploratory missions to reach deeper into space than ever before, they’ll also make the manufacturing and recycling of commercial electronics on earth more efficient and less expensive.
For the near future, NASA’s push for space-based manufacturing will benefit electronics companies only tangentially, by developing sophisticated new technologies that can be leveraged here on Earth. But eventually, electronics manufacturers will be able to reap the benefits of space more directly, by conducting research and development in sterile, microgravity environments—and possibly even manufacturing products there.
Companies hoping to one day conduct research or manufacturing in space have found a strong ally in NASA, which has doled out nearly $40 million in seed money to enable companies and research institutions to develop new technologies. The space agency has been up front about its desire to develop a robust economy in low-Earth orbit (LEO), and sees itself as both an investor and a future customer of the companies it helps fund.
The semiconductor industry is of particular interest to NASA, which of course benefits from smaller, faster processors.
Space offers a unique environment for research and manufacturing. Perhaps the most useful aspect of this environment—especially for semiconductor manufacturing—is microgravity. The near weightlessness of low-Earth orbits is ideal for chip manufacturing.
Right now, semiconductor chips are made in highly sanitized clean rooms, because even microscopic specks of dust can ruin a chip. Keeping these rooms clean requires expensive protocols and equipment—sophisticated filtration systems, multiple exhaust structures, static dissipative materials, and climate control equipment.
But in microgravity, specks of dust don’t “fall” onto chips. That’s one reason why a clean room in space would be easier to operate. Another reason is the natural vacuum of space. Researchers are now working on ways to leverage this natural vacuum to reduce or eliminate the gases that are generated during chip production. An innovation in this area could lead to more efficient layering techniques—both in space and on Earth—which would lead to smaller, faster chips.
One of the roadblocks to manufacturing in space is the need to bring equipment and raw materials into low-Earth orbit—an expensive proposition. Fortunately, there are startup companies already tackling this problem, including a new business in Davis, California. Build Beyond LLC, a seed-stage startup, has created a device that can harvest metal from the space junk orbiting above us, and then recycle that metal to make new structures.
The device works on steel, aluminum, and other metals. It uses magnets to capture, move, and melt the material. Eventually, it will also be able to mold the metal into new shapes. The goal is to create an inductive foundry in space, one that can produce rods, plates, struts, and other components.
As with so many technologies developed for space, Build Beyond’s device has potential applications here on Earth. Because inductive welding doesn’t create sparks, this technology could be used for welding or mending cracks in pipelines, large containers, and railroad cars. And because the device is designed to work autonomously, it can make dangerous repairs remotely—a real boon for worker safety.
The Davis startup’s recycling system is a prime example of where space-based manufacturing is right now—at the very beginning. And though these new technologies are being developed to operate in low-Earth orbit, their initial applications will probably be rolled out here on the ground. So while it may take decades to have factories in space, the benefits of these manufacturing innovations will be here a lot sooner.
Prices for semiconductors have risen steadily since 2020, and the increase is likely to continue for a while longer. According to the U.S. Bureau of Labor Statistics, businesses in the U.S. paid 8% more for chips in July of 2022 than they had a year earlier, and experts predict a similar increase this year. These price increases are having a significant impact on electronics manufacturing.
While there’s not much electronics manufacturers can do about the cost of the chips they use, it is possible to offset this price increase by streamlining manufacturing processes and optimizing the use of materials. Here are four steps you can take to keep a lid on the price increases you pass along to your customers.
It’s a standard rule of thumb that the more unique pieces you use to make your product, the more expensive it will be. So, whenever you can use the same component for more than one purpose, do it. Adopting a common platform architecture—using as few unique components as possible—will enable you to buy parts in larger quantities, allowing you to qualify for bulk discounts.
Simple components, such as screws, are especially well suited to common platform architectures. Instead of using a unique screw for every one of 16 distinct functions, for example, use one screw as many ways as you can. This might let you cut back from 16 types of screws to five and enable you to save money by buying your screws in larger quantities.
Even more complex components can perform double, triple, or quadruple duty. Surface mount resistors are a prime example. It may be more elegant to design your board with optimally sized resistors in every position. But buying resistors in four sizes, for example, can be expensive. It is often more efficient to consolidate your component package, simplify your bill of materials, and benefit from bulk discounts.
Similarly, you can sometimes reap significant savings by switching from custom components to off-the-shelf ones. That custom connector may be ideal for your product, but if it’s not available in stock and must be ordered from the manufacturer, you may pay more. Switching to an off-the-shelf counterpart will not only cost you less, but it will also be easier to source. And do you really want to be dependent on one source for a critical part?
Sometimes companies turn to custom components because their products are aging, and parts are getting harder to source. But in that case, the answer is not to bend over backward to find increasingly scarce components. Maybe it’s time to consider a redesign.
Whether you are updating an existing product, or bringing a new device to the drawing board, it is important to design with manufacturing in mind. Designing a clean product may offer lower material and labor costs and reduce risk.
Concurrent manufacturing, in which the product’s design and the manufacturing process are viewed as one single design challenge, can optimize your product’s functionality, and lower the cost of its production. Concurrent manufacturing lets you step back and look at the total cost of making your product.
The reality is that the cheapest part isn’t always the least expensive—not if it raises your labor costs by more than you save on the part. PCBs are a case in point. A slightly more expensive board, one that enables you to add test points to the bottom, can reduce your overall manufacturing cost by making it possible to easily test your product, ensuring a consistently elevated level of quality. Keeping such factors in mind as you design your PCBs will save you money later.
Similarly, designing your product to minimize the number of unique parts doesn’t just simplify your bill of materials, it also reduces your labor costs. Any time you can minimize human motion, you speed up assembly. To go back to a previous example: Designing a product that uses only five unique screws instead of 16 means that workers are pulling components from fewer bins and need to be familiar with fewer components.
Considerations like these are why it is useful to loop in your manufacturer at an early stage before your product design is set in stone. If you allow your EMS provider to examine your product’s CAD files or Gerber data, they can suggest changes before you build your first prototypes. This can speed up your design process, reduce your manufacturing costs, and get your new product to market quickly.
At every stage of the design and manufacturing process, innovative technologies are introducing greater efficiencies. But even fans of the latest technology don’t always utilize it to its full extent.
Virtual prototyping is one such example. You are probably using CAD programs to create and manipulate prototypes virtually before you invest in physical versions. That is a smart use of the technology. But have you thought of sharing your CAD data with your EMS provider?
There are several advantages to doing so. Not only can your manufacturing partner vet your design for ease of manufacturing and testing, it can also use that data to design jigs and fixtures without having to measure your product. And examining your product virtually also enables a manufacturer to provide a more accurate quote—so there aren’t any surprises when the assembly line starts up.
Make sure your EMS provider is using their technology creatively as well. 3D printing, for example, is becoming more common. Now your EMS provider can skip the machinist and make their own custom jigs and fixtures, as well as specialized, ESD-safe, product-specific tools. This capability can save you both time and money.
And that is just the beginning. Now, instead of waiting for a final working version of your PCB, your manufacturer can 3D print one from your CAD files and jumpstart designing supporting components such as the case. And once your final product design is near completion, your EMS provider can 3D print a replica of your device and use that replica to design the packaging for your product—and even determine shipping costs. This means that you will be ready to start shipping your product as soon as it’s built.
As with design and manufacturing, you may have to make counterintuitive choices to optimize the amount of finished product you warehouse.
With supply chains showing signs of continued instability, inventory control is more critical than ever before. Fortunately, innovative technologies are making it easier to manage the stocks of both inputs and warehoused products.
With component parts, it is important to keep enough on hand to avoid a production slowdown, without paying for unnecessary warehouse space. For some parts, it makes sense to buy 18 months of supply at a time. With others, buying enough for six months will be sufficient. The trick is figuring out the right amount for both so that inventories align with build schedules. If a microchip is getting low, does that mean the manufacturer is getting behind? Or is it the result of a temporary spike in customer orders? Your strategy for managing the shortage will be different depending on the answer.
It is important to know which components only need a six-month supply, and which require hoarding. A good manufacturing partner can alert you to changes in component status and advise you on how much you should carry.
For finished products, your EMS provider should be using barcode scanners to gather real-time data, so that it can precisely track lots and batches of your product. This not only lets you maintain stock equilibrium, but also makes it easy to manage returns and get an accurate read on inventory levels at a moment’s notice.
As with design and manufacturing, you may have to make counterintuitive choices to optimize the amount of finished product you warehouse. For example, it may make more sense to build your products every quarter instead of every month. The inventory costs will certainly be higher, but it’s still worth it if the manufacturing savings are greater than the increased warehousing expenses.
Supply chain calculations like these are fluid and complex, and so require close communication with your contract manufacturer. For this reason, electronics OEMs are tightening communications with their manufacturing partners, sharing more data and—in some cases—moving manufacturing back to the United States.
The term “electronics manufacturing” encompasses a broad range of industries, from consumer electronics to aerospace. But not every contract electronics manufacturer has the broad range of capabilities necessary to serve more than one or two industries. In other words, the contract manufacturer that does such a great job building a toy robot may not be the best choice for building an optical transceiver. That’s okay, as long as the electronics manufacturing service (EMS) provider you choose has the capabilities you need for your particular device. To make sure that your product is in good hands, be sure to keep the following in mind.
If your product is a medical device, then at a minimum, your EMS provider must be ISO 13785 certified. But this certification is just the beginning. Medical devices must meet exceptionally high production standards, which means your product will likely require a customized manufacturing solution—one that incorporates rigorous testing. In addition, your EMS provider should have engineers on staff who can review your design to catch any potential issues that might compromise the product’s safety or reliability.
If your products are destined for aerospace or defense customers, then security and reliability are key. Your EMS provider should be ITAR registered, not just for manufacturing, but all along the supply chain. Your provider should also be familiar with the demands of building and shipping secure devices and should be able to deliver complex assemblies while meeting strict national security standards. At a minimum, it should adhere to NIST standards and employ up-to-date technology—like ESD flooring to protect sensitive microelectronics, and AOI systems to detect even minute flaws early in production. Ideally, your provider will also be able to securely pack, ship, and track your products.
If you sell electronic devices to the general public, then you need an EMS provider who can respond quickly to modifications and/or upgrades to your product. Consumer tastes are ever changing, and products need to evolve in response. If your EMS provider has engineers on staff who can help you tweak your product’s design and quickly modify the manufacturing process, you’ll be able to meet consumer demand before it morphs yet again. Ideally, your EMS provider should also offer shipping and logistics services with a strong predictive capability, so that you can respond rapidly to fluctuations in demand. An experienced provider can ensure that you don’t carry too much expensive inventory, or miss out on potential sales because of a product shortage.
The contract electronics manufacturer that does such a great job building a toy robot may not be the best choice for building an optical transceiver.
While it’s true that many manufacturers specialize in delivering services to a particular industry, there are a few qualities that are shared by all top-notch EMS providers. Here are the capabilities your manufacturing partner should have, no matter your industry.
Industry Experience: Whatever your field of electronics, life will be easier if your EMS provider has experience working with products like yours. In the same way that surgeons gain expertise with every operation they perform, manufacturing engineers are in many ways the sum total of every product they’ve helped bring to market.
Technical Expertise: Speaking of engineers, be sure your EMS provider has the technical expertise your product demands. Simple products don’t need an engineer’s involvement, but if your electronics device has multiple functions, an engineer with deep PCBA experience can help you streamline your board design without losing functionality.
DFM Services: Your engineers may have come up with an elegant product design, but how easy is it to build? A strong EMS provider will have engineers who can analyze your prototype to make sure your product can be built at a reasonable cost and speed. For example, they may recommend off-the-shelf components to replace custom parts, thus lowering the production cost.
Testing Services: Your manufacturer should regularly test the products coming off the line, especially early batches, so they can catch any systemic errors early on. Keeping faulty products from making it to market will save you from making warranty repairs or sending replacements to customers. To make this easy and inexpensive, your device should be designed with testing in mind—something a capable manufacturing partner can help with.
Certifications and Registrations: An easy way to get a sense of an EMS provider’s capabilities is to look at the certifications they hold. At a minimum, the provider should be ISO 9001 certified. For sophisticated devices, make sure your provider has SMTA-certified engineers on staff. Depending on your industry, you’ll also want to check for specialty certifications and registrations, like ISO 13485 certification for medical devices, and ITAR registration for defense products.
Advanced Technologies: What technologies does the EMS provider offer? For example, is it capable of in-house 3D printing of jigs, fixtures, and ESD-safe tools? Does it have a laser available to easily etch and cut metals? An EMS provider that has these technologies on hand can greatly speed your time to market.
Awards: Though not as important as certifications and registrations, awards do tell you something about the quality of the contract manufacturer, especially if those awards come from customers.
Environmentally Responsible: Most companies today are working hard to green their manufacturing processes and ease the environmental footprint of their products. If this is a priority for your company, then look for an EMS provider that incorporates circular-economy principles into its manufacturing processes and can help you design a product with a sustainable lifecycle.
Supply Chain Services: A manufacturing partner that’s skilled in supply chain management can help you source less expensive components and make it easier to navigate global supply disruptions. It can also help you eliminate waste and redundancy and maximize the recovery of useful material at your product’s end of life.
Fulfillment Services: Packaging and shipping is the last mile of the production process, and a full-service EMS provider will offer this. Ideally, your provider should be able to track your products from the factory floor to the point of sale, facilitating returns and allowing you to gather valuable user data.
Medical device manufacturing, for example, has yet to return to normal, and that’s reflected in the profit-and-loss statements of many manufacturers. ResMed, Medtronic, GE Healthcare, and NuVasive Inc. all recently downgraded their expected earnings. And while medical technology hasn’t suffered as much as other sectors of the economy, that’s small comfort to the users of these products, whose very lives depend on CPAP and other machines.
The CPAP shortage is especially bad, with wait times of several months in some cases. And these shortages have been made worse by unexpected recalls. Medical device suppliers are still recovering from the 2021 Class I recall of more than 5.5 million sleep apnea and ventilator devices by Royal Phillips.
It wasn’t just supply chain disruptions that led to the ongoing chip shortage. Some chip buyers also miscalculated—and that mistake has cost them dearly. In the early days of the pandemic, major buyers expected a global recession, and scaled back their chip orders accordingly. But the recession didn’t materialize. In fact, the opposite occurred. Demand for telecommunications technology and consumer electronics surged, catching chip makers and their customers by surprise, and contributing to chip shortages in other industries as well.
Back in January, the U.S. had only five days of chip inventory, at a time when demand for chips was actually increasing. As U.S. Commerce Secretary Gina Raimondo said at the time: “We aren’t even close to being out of the woods. The semiconductor supply chain is very fragile and it’s going to remain that way until we can increase chip manufacturing.”
In August, the government took direct action to alleviate the semiconductor shortage with the passage of the CHIPS and Science Act. The act is designed to turn the U.S. into a major manufacturer of semiconductors and to counter China’s dominance in this arena. It provides $280 billion for domestic research and manufacturing of semiconductors. More than $50 billion of that funding is being used to entice manufacturers to open domestic production centers. And the carrot is working. Intel, Samsung Electronics, and Texas Instruments are all moving forward with new U.S.-based factories that should come online sometime in 2024.
While that’s good news, it will be a while before chip production reaches comfortable levels. The war in Ukraine has disrupted the global supply of krypton and neon, two critical chip-making ingredients. Similarly, COVID-19 outbreaks in China—and the government response to those outbreaks—have reduced the industry’s lead frames stockpile. So even though chip-making costs have dropped from their highs earlier this year, they are still running nearly 20% above pre-pandemic levels. And lead times for some chips can be nearly 50 weeks.
While the supply chain is recovering, the process has been a slow one, and there is still a lot of uncertainty. To cope, some companies have redesigned their products, even changing their functionality in some cases. When ResMed Inc. found it nearly impossible to acquire cellular communication chips, for example, it redesigned its CPAP and APAP machines to work without those chips, and rebranded the products as card-to-cloud devices.
Other companies have adapted to the chip shortage by switching from custom to standard parts. PRIDE Industries recently helped one of its long-time customers redesign a best-selling Class II medical device. The custom chips the product relied on were simply no longer available, so PRIDE Industries reworked the design to use widely available standard components. The new design performed every bit as well as the previous one, with no loss in product functionality. And the entire effort—from initial redesign to finished assembly line—was accomplished in three months, minimizing disruptions for the customer.
There’s no question the chip shortage is still causing problems. But U.S. companies are responding with inventive solutions. Through redesigns and rebranding, they’re managing to meet customer expectations, and slowly but steadily regaining normalcy in their product delivery.
Long term, the future looks bright. Semiconductor availability is improving, and when it comes to the chip supply, the end of 2022 is definitely better than the beginning. Domestic production is already ramping up, and if trends continue, 2023 could be a happy new year for both electronics manufacturers and their customers.
