Active EMS Discusses The Supply Chain of Everything – How Active EMS Work to Protect and Preserve in a Problematic Time.
By Simon Broomhead, Commercial Director at Active EMS Limited.
Active EMS adds value through a series of strategic processes, including in depth research of material availability and obsolescence management. For example, our team can assist you with last time buys and alternative component sourcing, thus enabling new product introduction (NPI), production readiness reviews (PRR’s) and design for manufacture and test (DFM and DFT). As a traditional electronics manufacturing service provider (EMS), we offer front end lifecycle activity through to manufacturing, distribution, and after-market services. To create and sustain value-add, Active EMS recognises the benefit of supporting our suppliers and customers to allow the whole supply chain to survive and thrive.
We call it ‘the supply chain of everything’.
In this article, Simon Broomhead, Commercial Director at Active EMS discusses the steps that Active EMS have taken to preserve their valued customers supply chains during these unprecedented times.
Future Proof to Protect
“You can’t avoid the news about supply chain disruptions, it’s everywhere and affecting almost everything. If you relate it to your normal day-to-day life, labour shortages and stock shortages result in our supermarket shelves being empty. As consumers, the optics played out in our newswire dailies feed our fear. The same is happening in the electronics manufacturing market, the only difference is that it’s at an industry level.
Crisis avoidance and management can come from gaining a bit of perspective. Many are viewing the current electronics component shortages as a disaster. I’ve personally lost track of the number of phone calls that I’ve received that begin with the words, “have you heard the bad news?” This isn’t productive, in fact, it’s counterproductive. We’ve always been a proactive and forward-looking company at Active EMS. We are a company that doesn’t accept the word ‘can’t’. Many of our team members have demonstrated incredible inner strength to be at the position they are in today, which I think contributes to their positive mental attitude. This helps us when we find ourselves in the kind of situations the current market climate has presented.
So, we made it our priority to ‘get our ducks in a row’ to work with our suppliers and our customers together to ensure that we were able to secure their supply chain future. It’s not been easy or plain sailing, with our customers having to commit in some instances to almost a 24-month forecast, which can be hard to predict. At Active EMS, however, we are small enough to be agile to forecast fluctuations, but large enough to achieve a competitive position in sourcing to leverage off economies of scale. This helps us to address resourcing challenges, but also enables us to plan our business in a strategic way, whilst managing cashflow.
So, whilst many have been proclaiming ‘woe is me’, we have taken the opportunity to look forwards, to what the future holds, beyond this not insubstantial bump in the road. The entire electronics manufacturing sector reduced capacity during the height of Covid. Requirements reduced across almost all market segments, from automotive, to consumer, to industrial, and beyond. The automotive industry, however, is waking up and has created a bow wave.
Due to their sheer size and scale, the automotive original electronic manufacturers (OEMs) are soaking up as much of the component availability as possible. Whilst, as its business, the Original Component Manufacturers (OCMs) are naturally focussing on their most profitable lines. This of course leads to gaps in the pipeline, and the need to react quickly to ensure when availability comes, you’re ready to pounce, literally. And we are ready!
Never a company to idly wait, we’ve also utilised this time wisely, writing new SOP’s and optimising production techniques and SMT programmes, equally we are taking the opportunity to invest, installing new capital equipment and assembly cells, and have recently starting a recruitment campaign to bring in new team members to be ready for the upturn. So as the supply chain reacts to demand we come back on stream bigger, better, faster, and even more efficient.
We’re starting to see the taps open again, clients are reacting positively and their understanding of the importance to plan a long way in advance has been harshly reinforced. Our order book extends to 2023 and beyond, our purchase orders placed and adjustable, and we’re ready to serve and grow!”