For a company looking to outsource for the first time, to appoint an additional EMS partner, or to replace the one they already work with, should be the result of a strategic decision. On one hand, there’s talk of global businesses offshoring, nearshoring, re-shoring, and the roles of Tier 1, 2 & 3 EMS players in those ventures. On the other hand, there are EMS companies offering specialisation in low volume, high mix or high volume, low mix sectors. But, what does it all mean? Perhaps more importantly, how does any of this help when a company is looking to appoint an EMS partner?
If you’re serious about finding a new, long-term partner it’s worth going through a proper selection process to identify a shortlist of ‘right fit’ suppliers to approach.
Here are some of the decisions you should go through:
Select an EMS provider that best ‘fits’ your company needs
Clearly, no two EMS companies are the same and selecting one that best fits your business requires a well thought out approach. In order to filter out the ‘probable’ and ‘possible’, and arrive at a shorter list, the first thing to look for is a good overall fit. Take into consideration the size of the EMS company in relation to your business, the typical volumes they build, the complexity of the products they produce, and then look at their accounts to see how they have been performing.
Trust your instincts
From the moment you arrive at the EMS company, there are things that will tell you so much. Some would say, “weeds in the car park” test. What relevance is a car park with weeds growing in it? Whilst this may sound trivial, if the company is not concerned with how it projects itself to external visitors, then maybe that tell you something… You will be relying on them to take away cost and hassle, and this demands a systemic approach to attention to detail – either they have one or they don’t.
Who? What? How? – Ask Questions
Once you are inside the building it’s the “Who?”, “What?” and “How?” that should be uppermost in your mind. The sequence and weighting of these elements could again be debated but I have listed them in what I believe to be the order of importance.
- The Who? – Relates to the people employed at the EMS company. Who is in charge? Who will be your day-to-day contact? Who is in charge of the supply chain, production and engineering? Did you meet any/all of them? You need to get an indication about how the company perceives its customers and there is no better way than talking to people across the organisation.
- The What? – Relates to the systems and equipment available to the people working there. This goes beyond checking the capabilities and currency of the Surface Mount Pick and Place Machines, Box Build assembly etc, it extends to Test and Inspection equipment, and the functionality of the IT systems that are available to track and monitor all aspects of your products as they move through the business.
- The How? – Relates to the processes and procedures that bind the whole process together, i.e. how organised and controlled do you feel it is? Quality accreditations are important trust indicators (ISO 9001, IS0 13485, ISO 27001), of course, but how do you feel they are being implemented and used to provide good customer service? How well it all works can be measured by looking at their On Time in Full (OTIF) performance. Every EMS provider will measure this, those that tell you they don’t automatically disqualify themselves!
How much will this cost?
Finally, there is the cost. Cost details on a first visit may be unlikely, as this needs to be investigated, and pricing proposals submitted downstream. A better understanding of the true cost will be given if you are prepared to work with the chosen EMS Company to put together the quotation. By doing so the cost will be far more accurate than by going out to a ‘shortlist’ of multiple companies.
The true cost of acquisition is not just what you see on quotes and invoices. A well organised, customer-focussed EMS company, that continually works closely with their customers to exceed their expectations, will take significant cost out of your supply chain by requiring less of your resource to manage them and avoid issues.
So, with all of the above, by striking up a successful long-term relationship with a good EMS provider, this will repay all the time and resource you expend in your research and selection process. You should see those rewards emerge in the shape of higher productivity, more speed and operational agility, as well as better quality in your end products.