Manufacturing: It’s Not Getting Any Simpler!

We recently came across an IDC white paper that quantified something you’ve probably suspected: manufacturing complexity has increased in the last five years and will continue to rise over at least the next three.

By interviewing manufacturers in the automotive, aerospace, high-tech electronics and industrial equipment industries, IDC’s research found, among other things:

  • Complexity has risen in the last five years, according to 53 percent of manufacturers, with the majority of manufacturers (57 percent) claiming that it will continue to rise over the next three years.
  • All industry sectors anticipate complexity to grow fastest in their respective markets, closely followed by their internal processes.
  • Aerospace, industrial machinery and high-tech electronics rank technology as the third area likely to become more complex, while automotive companies put increased supply chain complexity third.
  • When asked about barriers to harnessing complexity and improving operational excellence, findings point to a lack of agility in adapting business processes to change (66 percent), and ineffective or inadequate IT systems (61 percent).

What’s Driving Manufacturing Complexity?
In our experience, a number of factors are behind the rising complexity in manufacturing. These include:

  • Smaller Form Factors: Components are becoming smaller and smaller – and board designs increasingly dense – to help product makers pack more components into less space. As components decrease in size, the challenges associated with printing the boards, placing components, and testing the systems increases.
  • Global Supply Chains: Few supply chains are local in today’s global economy. While global supply chains reduce costs, they also introduce added complexity due to differences in time zones, language barriers, differing legal requirements and more.
  • 3D silicon: The emergence of stacked 3D silicon has already had a major impact on microelectronics systems and other products into which it is being integrated. It allows designers to reduce footprints by stacking components vertically using thin integrated circuits.
  • High-Volume Components: Many of today’s component technologies are built for high volume and are therefore purchased and shipped in very large reels. This makes it difficult for lower-volume manufacturers to optimize the manufacturing process. It can be very costly to run an experiment of 10 or even 50 pieces when the component reels come in lots of hundreds or thousands.

These factors are making it increasingly difficult for niche OEMs to manufacture low- to mid-volume parts efficiently. As you increase the number of parts, you also increase the odds that you’ll run into a problem caused by the challenges outlined above.

Lean on an Expert
To ensure that your products are manufactured efficiently in today’s marketplace, you will need to partner with a manufacturer that understands these challenges and has the expertise – and processes in place – to address them.

A turnkey contract manufacturer (CM) like OCM Manufacturing has the expertise to provide all manufacturing and supply chain services, including material acquisition, assembly, test, and aftermarket service and warranty support. Low-volume, high-mix CMs manage a large number of varied products and therefore have the necessary processes and cross-functional skills to handle the complexity of the modern manufacturing process.

At OCM, for example, we do not produce millions of units of a small set of products. Rather, our specialty is producing dozens of different products at a time in volumes of hundreds or thousands. This has given us the experience, processes and cross-functional talent required to source, supply, inventory and manage a variety of parts, processes, markets and frequent turn-over on our lines.

To learn more about our operations or to tour our factory, please contact us.