Globally, there is a strong trend toward outsourcing electronics manufacturing, to balance the production cost and transaction cost of manufacturing. For OEMs, this balance needs to be struck while also practicing due diligence. The general term applied here is XaaS, or Anything as a Service, which applies to any service that can be provided to a customer by a commercial partner. For OEMs, this broad scope can be focused on Electronics Manufacturing as a Service. The nature of a global market means that all vertical sectors operating in multiple regions are subject to variable economic pressures. Locally, those pressure may be quite different but, collectively, they will influence business decisions.
In October 2020, India’s Ministry of Electronics and IT (MeitY) approved the applications from ten international mobile phone manufacturers for a share of its Product Linked Incentive scheme, including Samsung, Foxconn Hon Hai, Rising Star, Wistron, and Pegatron. In August 2020, Samsung Electronics Co and Apple Inc collectively pledged nearly $1.5 billion of investment to establish mobile phone manufacturing units in India. These investments, both from international companies and India’s government, show the commitment to making India’s Electronic System Design and Manufacturing (ESDM) sector stronger and demonstrate the financial benefits of investing in India.
OEMs looking to outsource electronics manufacturing must look closely at potential ESDM partners. This includes requesting details about the electronics manufacturing partner’s capacity, capabilities, and accreditations, of course, but it also extends to the stability and support they receive from their parent nation.
In India, the government in past has approved a scheme to support domestic manufacturers operating in 10 key sectors. The funding is intended to help make India more competitive on a global scale, but ultimately it also helps those companies advance and maintains the services they offer to their OEM customers. This five-year plan builds on a long history of development in the region.
With a strong design and electronics manufacturing infrastructure already in place across India, Napino Digital Solutions is an established supplier in this respect and is well-positioned to leverage the scheme for itself and its clients.
As an example, the automotive manufacturing sector in India has evolved over the last seven decades, from a net consumer to a resource for final assembly, and more recently into a global provider of outsourced electronics manufacturing services. To maximize the efficacy of outsourcing, OEMs should consider how much of the process they can outsource. For electronic products, this covers the design, manufacture, test, certification, and validation processes.
The scope for Electronics manufacturers
Deciding on your electronics manufacturing services partner for any activity requires careful consideration. The challenges here are many, but it is the nature of electronic products to comprise hundreds of individual components. Each one of those components will have a critical role, from the largest integrated circuit to the simplest passive component.
Managing the supply chain for the Bill of Materials is fundamental when working to a customer’s schedule. This requires an electronics manufacturer that can demonstrate a world-class procurement system, with access to leading component suppliers and robust logistic networks.
Any delay in the supply of any component can have a compounding impact on delivery times, so the ability to demonstrate a well-developed and proven JIT (Just in Time) approach to manufacturing is non-negotiable. Equally important is the partner’s capacity, expertise, and access to the resources needed to deliver a world-class service. In a manufacturing environment, this can be demonstrated by inspecting the manufacturing facilities, including the equipment needed for PCB assembly, flow soldering, inspection, and final assembly. The investment required to establish these resources is considerable.
Napino Digital Solutions is not alone in making huge investments in its production technology, for the implementation of Industry 4.0. This enables it to fully support any global standard, at any scale.
For a full, turn-key service, OEMs will also be looking for partners that can provide value-added services, such as design evaluation. This may involve consultation that assesses the readiness of a design from a DFM (Design for Manufacture) point of view. The production costs of outsourcing are largely dependent on the electronics manufacturer’s capabilities and this very much extends to their ability to carry out a DFM analysis. The OEM customer should not pay for the lack of manufacturability if the services partner isn’t able to help identify issues early on in the relationship.
Utilizing IoT to overcome challenges in electronics manufacturing
There is a major evolution happening in electronics manufacturing, with the adoption of IoT technologies in what is generally referred to as Industry 4.0. This enables manufacturing data, generated on the production line, to contribute towards a more effective process. Companies embracing Industry 4.0 need to invest in new systems that support this Big Data paradigm. They must also have a well-defined strategic approach to using that data most effectively. The returns on this investment are transferred directly to the customer, who receives a better service at a more competitive price.
This requires a manufacturing execution system (MES) that brings together all key elements; a smart supply chain with smart services, and smart innovation to deliver smart products. This vertical and horizontal integration of services and capabilities delivers smart manufacturing on a scale that reflects the needs of a global economy.
Modern manufacturing equipment is equipped with Industry 4.0 connectivity, but it takes a leading-edge MES to bring that together in a way that delivers real value. It means components and products are monitored and traced at every step in the production process. Operators work with the equipment to ensure customer lines operate in an optimized flow.
Partner with Napino Digital Solutions to take your product to the mass manufacturing stage
Outsourcing electronic manufacturing services is a growing trend. Analysts estimate the sector is already worth over $400 billion. This puts electronics manufacturing services providers in a strong economic position to drive the cost up. India is emerging as a financially viable destination for outsourced electronic manufacturing services, thanks to the global conditions now in force. Succeeding in a global arena demands a provider that can demonstrate it has already made the necessary investments in its infrastructure and can offer contract manufacturing services. Napino Digital Solutions has demonstrated this and has the economy of scale needed to be responsive but still agile.
It also requires demonstrable expertise in the specific application areas and vertical sectors targeted. Like Napino, the ESDM must also embrace the latest technology to achieve high efficiency and exemplary supply chain management. Operating a production line is only part of the solution. A reliable electronics manufacturer also depends on excellence at the design stage, expertise in PCB assembly, an ability to manage the entire product lifecycle, and an investment in the very best quality assurance and inspection technologies, to maximize yield.
Napino is one of India’s leading manufacturers of electronic assemblies, with a strong reputation and established relationships with leading OEMs around the world. As a technology-driven organization, it has sustained its growth through business excellence. As part of its mission, Napino Digital Solutions continuously strengthens and upgrades its manufacturing processes and quality systems, while investing in its employees.
This has enabled Napino Digital Solutions to become India’s leading manufacturer of electric/electronic products, with more than 20 million units manufactured annually. With seven manufacturing sites and two R&D/Design Centers, Napino Digital Solutions counts many leading Tier 1 and Tier 2 suppliers as customers.
CONCLUSION
Manufacturing electronics & the global need for excellence in electronic product design outweigh availability. More OEMs are now looking to focus on their core skills to bring more products to market faster, to meet consumer demand. India is emerging as the most competitive destination for outsourced electronic manufacturing services. With its long history of excellence, demonstrable investment in technology and people, and a commitment to exemplary customer service, Napino Digital Solutions is already working with many of the world’s leading automotive, consumer goods, and medical OEMs. Its mission remains to deliver the best range of manufacturing services, from design, production, test, assembly, and certification.
