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An Alternative Approach to Vertical Integration in Manufacturing
July 13, 2017 | Richard Kelly, MC AssemblyEstimated reading time: 5 minutes
When you now apply the same model to the high-mix/low-volume (HMLV) manufacturing environment, directionally, the results become dismal. This is the environment that MC Assembly matriculates as does most EMS mid-tier companies. Strict dedication of capital-intensive manufacturing machinery is impossible.
Figure 6: A worker can be seen inspecting the final boards for quality.
Our customer base values flexibility and responsiveness. They look for EMS partners instead of EMS suppliers and seek supply chain solutions that integrates their consumption with the EMS partner’s production.
Vertical Integration in Mid-tiered EMS
Curiously, vertical integration has seeped further and further into the EMS world, even to some mid-tiered EMS companies. Not understanding their business plans, it is difficult to judge this move as right or wrong.
Instead of trying to be the best in every manufacturing technology, it’s preferable to develop suppliers who are best-in-class for their respective technology. Even within specific technology groupings, differentiations such as press size, cosmetic capability, labor costs, and site locations are factors that differentiate one from another. Ultimately, this “virtual” integration may probably be a better solution for the mid-tier EMS companies versus a “vertical” integration solution.
This article was originally published in the July 2017 issue of SMT Magazine.
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SEMICON West 2024 to Spotlight U.S. Chip Industry Investments, Supply Chain Resilience, Talent, and Global Growth and Innovation
05/15/2024 | SEMISEMICON West 2024 will gather industry experts and leaders July 11-13 at the Moscone Center in San Francisco for insights into the latest trends and innovations in sustainability, supply chain management, workforce development and other critical industry issues.
Using AI to Redefine Productivity
05/15/2024 | Nolan Johnson, SMT007 MagazinePlato Systems, a machine perception company spun out of Stanford University, employs AI and video data to analyze and optimize the human component in manufacturing. Initially focused on semiconductors, Plato Systems has expanded into EMS manufacturing. Co-founder and CEO Amin Arbabian, along with product advisor Anders Holden and head of growth Luis Vidal, discuss their approach to changeover optimization and its impact on productivity in the industry. They’ve also included customer Raj Vora in the conversation.
SMTC Strengthens Leadership for Future Growth: Ed Smith Promoted to Executive Chairman; Mike Buseman Joins as CEO
05/15/2024 | BUSINESS WIRESMTC Corporation, a leading North American provider of electronics manufacturing services, is pleased to announce the appointment of Mike Buseman as President & Chief Executive Officer, effective May 13, 2024.
ACDi Expands East Coast Presence with Acquisition of Fourth Manufacturing Plant
05/13/2024 | ACDiACDi, a leading provider of electronics manufacturing services, today announces the expansion of its East Coast presence and manufacturing capabilities with the acquisition of a fourth manufacturing plant in Kilmarnock, Virginia. The company signed an asset purchase agreement with QinetiQ to acquire their Virginia facility and its assets, including SMT, wave soldering, AOI and SPI equipment. The deal brings ACDi to 4 East Coast locations with a total of 9 SMT lines.
LPKF is Ready for Increasing Demand for Glass Substrates in the Semiconductor Industry
05/13/2024 | LPKFThe semiconductor industry is shifting towards glass to package the most advanced semiconductor chips. LPKF’s mature LIDE technology is enabling that transition into this new era from ramp-up to high volume manufacturing.