Oh, how the mighty have fallen

One trend we have noticed in the electronics industry, is the shrinking engineering support network inside engineering institutions. This happened for a variety of reasons:

Financially focused institutions moved from a vertically integrated model (everything done in house) to a more widely dispersed model (broad use of Contract Manufacturers either overseas or domestically). Engineers and support staff let go during the financial crisis were never replaced as engineers learned to “get by” with the people they have on hand. This included supporting roles such as component engineering and production engineering. Small upstart companies replaced larger legacy engineering companies by offering a more compelling product or a lower priced product. Companies that never integrated electronics in products previously are now empowered to do so with readily available resources, integrated services and far lower cost barriers to entry.

That’s not to say that large engineering institutions no longer exist. However, there are a growing number of engineers that used to have a support staff that “took care of the rest”; now they are experiencing a world without assistance.

The lone engineer

It used to be easy.

It used to be that Bill the engineer would design something, his tech Bob would build it for him, his test engineer Mike would verify specs for him, his layout engineer Susan would finalize the PCB, his production engineer Tony would help him ensure the thing could be built, his purchasing agent Molly would procure all the parts and his production supervisor Nicole would let him know that the build was on schedule and when the everything was ready to ship.

Now it’s just Bill.

This is the daily reality for a lot of engineers. Perhaps you, dear reader? The once mighty, vertically integrated company with on-site manufacturing is now not-so-mighty. Maybe it’s gone entirely. By choice or circumstance, you’ve moved on to the next thing. You’re at a small engineering firm, helping a mechanical engineer get a product into production at a local CM, but you’re in charge of it all now. Or you’re consulting for a large firm and you’re expected to design, prototype, test and show up with a sparkling device; one that can be integrated by people with other things on their minds.

Begin with the end in mind

You need to plan ahead and start considering the end product from the first day — your engineering role has expanded to include far more than just designing the product. What are some things that engineers at small firms need to think about?

Pricing – No more waiting until your prototype is ready in order to think about pricing. No longer can you assume that your large company’s clout will allow you to get discounts over published pricing. Never again can you assume that there isn’t a smaller, more nimble competitor from a lower cost-of-living country, ready to price you out of a market. You need to think about price and you need to think about it up front. This might mean that you start a discussion about a potential product with a chip manufacturer from the first day (when conceptualizing the product design and thinking about chips that will be included). If you are not producing enough to get the attention of a large chip manufacturer, your focus should be on finding stable, low cost components available in distribution. In the event you’re doing low volumes but still want to keep your costs down, the Parts.io Composite Price will make sure you find the lowest online distributor pricing.

– No more waiting until your prototype is ready in order to think about pricing. No longer can you assume that your large company’s clout will allow you to get discounts over published pricing. Never again can you assume that there isn’t a smaller, more nimble competitor from a lower cost-of-living country, ready to price you out of a market. You need to think about price and you need to think about it up front. This might mean that you start a discussion about a potential product with a chip manufacturer from the first day (when conceptualizing the product design and thinking about chips that will be included). If you are not producing enough to get the attention of a large chip manufacturer, your focus should be on finding stable, low cost components available in distribution. In the event you’re doing low volumes but still want to keep your costs down, the Parts.io Composite Price will make sure you find the lowest online distributor pricing. Availability – The purchasing department that kept a watchful eye on the supply chain for you has disappeared, so now you have to focus on lead times — you need to start with parts you know you can get in 3-6 months time when your prototype will be ready to go to production. This could mean making the compromise to design in a component with lower “leading edge” specs, in order to favor parts that are readily available in the supply chain, or readily replaceable with FFF components. Your component engineer is gone now too, so no one is reminding you to second source your components. Parts.io Risk Rank is the tool to use for finding those components that have readily available replacements your production house can drop in immediately and without fear.

– The purchasing department that kept a watchful eye on the supply chain for you has disappeared, so now you have to focus on lead times — you need to start with parts you know you can get in 3-6 months time when your prototype will be ready to go to production. This could mean making the compromise to design in a component with lower “leading edge” specs, in order to favor parts that are readily available in the supply chain, or readily replaceable with FFF components. Your component engineer is gone now too, so no one is reminding you to second source your components. Parts.io Risk Rank is the tool to use for finding those components that have readily available replacements your production house can drop in immediately and without fear. Filling out the entire BOM – The Bill Of Materials (BOM) is a traveling document that tells you which parts are being populated on the board. This also hints at which parts will need to be purchased and in what quantities. If you have 36 different instances of an 0805 1uF X7R capacitor on the board and you hope to make 1000 of your product, you will need to ensure you have 36000 of those capacitors on hand with even more on the shelf in case of wastage on the pick and place machine. Now that you don’t have a production supervisor looking over your shoulder and a purchasing person checking that the exact part number you listed is available in the marketplace, you need to have another plan. You need flexibility in which parts you are willing to use; parts that match what’s available in the supply chain at the time of board assembly. Sure, you might have your Contract Manufacturer use what they have on hand. But if you need to be explicit with which part numbers you use for the assembly, you will need the Parts.io Infer Service to quickly find replacement components that fit your passive specifications.

Moving from a big company to a small on has an array of challenges; you will be expected to do more with less, all while producing the same quality of product. However, there has never been a better time to get products made, even without a large support network. Many of you may identify as an engineer somewhere between “on your own” and “in a megacorp”, but the tools listed above will support your design decisions from day one and ultimately assist you in making a better product.

In future articles, we will talk more about the large companies and the realities of electronics design from “the top of the food chain”. Understanding how products are made in all types of companies will give a better picture of the supply chain and how things are really done. We would love to hear more from you in the comments about your experiences making products.