The manufacture of electronics products is currently undergoing a transformation process. OEMs are outsourcing more and more development processes, while at the same time an increasing level of automatization in production is providing European suppliers with a better starting position. In Part II of our blog post, we talk to Jochen Gimple, Managing Director of Kontron Electronics GmbH, about the increasing demands on flexibility and project competence in electronics development and manufacturing.
In addition to the Original Design Manufacturing (ODM) market, Kontron is now also entering Electronics Manufacturing Services (EMS). What does that entail in concrete terms?
EMS is about pure manufacturing service for an already developed product. In ODM, the customer approaches us with an idea, a concept, or a customization request. At this point, we provide the development and manufacturing services. We offer both, and we are convinced that the demand for manufacturing services will continue to develop positively over the next years. As Kontron, we intend to be represented in this market as well.
What are the main challenges for customers when developing and producing a PCBA (Printed Circuit Board Assembly)?
When it comes to the flexibility of service providers, many companies have had rather unpleasant experiences. However, flexibility is essential precisely because of the growing number of changes in electronics - for instance, the software has to be adapted continuously. In this respect, specialized providers like Kontron are much more agile than high-volume providers on other continents.
Time to market has also become more important for customers in the course of digital transformation. For this reason, customers seek to get to the prototype as quickly as possible. In the embedded world, there is a noticeable trend towards Linux, especially in the context of communication-oriented or graphical application. Kontron develops and manufactures, among other things, the powerful and compact module components SoM (System-on-Module) and COM (Computer-on-Module). The prefabricated modules simplify the development of complex, customer-specific board architectures and open the perspective of a later processor upgrade without redesigning the baseboard. Indeed, one of our advantages in the market is a team of well over 50 electronics developers. This puts us in a good position in an area that is becoming increasingly complex and more software-intensive - especially in comparison with pure manufacturing service providers.
What does Kontron do differently?
The technical guidance is absolutely crucial, taking a holistic view of the product and its manufacture right from the start. In addition, we respond to the customer's wishes in the project methodology: Depending on how the know-how is distributed in this area, we employ Scrum elements or classic procedures.
Which aspects are particularly important to European customers?
Based on many talks with companies, we have noticed that they are looking for regional proximity. Embedded electronics is a complex issue, and communication in the company's own language and the regional proximity of the partner are highly valued. Thanks to our development and production facilities in Germany, Austria, Hungary and Slovenia, we can ensure this proximity to many different locations.
Which changes do you perceive in the ODM/EMS environment at the moment?
We can definitely identify a trend toward OEMs increasingly outsourcing development as well. There is an increasing demand for end products, including personalization, assembly and packaging. For this reason, customers are deliberately looking for suppliers who can provide more than just manufacturing.
Thank you for the interview Mr. Gimple.