Electronic manufacturing services, is popularly known as EMS. It is one of the most important processes across industries. It gives us access to the various electronic devices that all of us have grown used to.
Surface mounting of electronic components helped in manufacturing of printed circuit boards (PCB). This allowed manufacturers to rapidly assemble electronics and making them further available for the public in general.
While PCB’s are not the only drivers of electrical connection, they help a lot in overall tasks. They allow use of various small devices and components in a smaller area. Prior to PCB’s, various electronic devices were powered with a group of cables that were individually connected to power supply. PCB’s have made the devices compact. The mobile phones we use, would be in briefcases rather than our pockets or hands. Also, so would be the televisions we use would not be mounted on wall and would need a unit which would be 4 feet deep.
The use of electronic manufacturing services is done at the extreme initial stage. Once the printed circuit board manufacturing is complete, EMS is likely to give a large range of services. This includes the basic assembly of various circuit boards and the electromechanical assembly. It also includes testing, flex circuit assembly, electromechanical assembly to surface mounting. These operations give the boards the power to actually do more than charging from one point to another.
Variations in the overall EMS marketplace, along with type of sales cycle of the EMS-OEM and, various requirements placed on the EMS companies by customers, are few reasons due to which the industry should seriously consider restructuring. Listed below are some reason why electronic manufacturing services (EMS) need to be restructured
- The growth of EMS is dependent on the customer success in the market. The more the shipping more is the growth and chances to achieve the profits.
- The revenue generation for EMS is from the manufacturing fees, test fees, logistics fees, and other sources. All of these constantly need to monitor cost and reduction of the same. Restructuring will help in overcoming this challenge.
- Due to the business model of EMS and the scope of flexibility in contracts the forecasting of demand is critical. This is important so as to EMS firms are in line with various changes in demand and manage inventory risk along with investment planning.
- A mixture of various processes, systems, strategies and investments alignment is needed. This gives the optimum value creation and often allows the combination of companies within an EMS firm that is creating conflict across critical areas. Share of this task is to receive contracts that will help in growing of relations between customer and providers.
These are some of the factors that demand the overall restructuring of the industry. This is further going to influence the way our electronics are being manufactured, for the ease of our usage.