Outsourcing to an EMS provider – it’s all about trust

Most of us have heard people say that respect has to be earned. Similarly, many of us have grown up believing that people must also ‘earn’ our trust. Well, I would question if trust is earned or is it perhaps something we grant to others. In other words, which comes first?

I’ve no intention of starting a philosophical debate about the difference between trust and respect or the sequencing of trusting and being trusted. However I do feel that when it comes to outsourcing to an Electronics Manufacturing Services (EMS) provider, the Original Equipment Manufacturer's (OEMs) confidence in the EMS provider is critical, which does require trust.

The benefits of outsourcing can be compelling and are often difficult for OEMs to ignore. However, there are inevitably potential risks when selecting a partner for pcb assembly and/or total ‘box build’ product assembly, which can lead to concerns. These risks can often be mitigated by working closely with the right EMS provider. But there could still be concerns that really test your commitment to an outsourced manufacturing strategy.

By outsourcing some or all of your manufacturing you will relinquish some control over day-to-day manufacturing operations. As a result, it is not as easy to walk onto your shop floor and change things on a whim - such as final configurations - or to immediately stop/start what is going through production due to unexpected changes in customer demands.

A common concern for OEMs is that they will need to put their trust in someone who, as yet, is unlikely to have had a chance to earn their trust. Therefore, potential EMS partners must be able to demonstrate;they have the knowledge, capabilities, skills, processes, controls and agility to manage your business to a level such that you feel comfortable in relinquishing this control.

How can potential EMS suppliers earn your trust?

No doubt you will have done some initial research into potential EMS partners and, by working through a framework that guides you through the selection process, you will arrive at a shortlist of 2-3 suppliers. Once all the questionnaires, visits, detailed discussions about quality and performance etc, presentations and proposals are completed and a preferred potential supplier emerges, all that is needed is that final leap... can you trust them? This is when OEMs can be most vulnerable to ‘analysis paralysis’.

So what can you do to assure yourself that you are choosing the right partner for your business?

Notwithstanding the quantitative detail you may have gathered up to this stage, it then becomes all about trust, and trust is all about people. So, have you met the people at the EMS provider? When I say ‘people’ I don’t mean just the ‘front of house’ business development team, but have you spoken to the people on the shop floor who will actually be building your products? Have you met their managers? Have you met the senior management team who will oversee the performance and agility you are looking for?

And don’t forget the EMS company’s existing customers. Are you aware of the performance levels demanded by their customers and how these performance metrics are reported to them? Insist on talking to some of these businesses. You may well find that they went through the same deliberations that you are and, by discussing their experience of the transition process, it could help to alleviate your concerns.

Whilst it’s relatively easy to find a number of EMS companies that have the capabilities you require to meet your product requirements, finding one that you are prepared to put all of your trust into may take you a little longer.

Image by: fisserman

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Written by John Mayes

John is a business consultant with an extensive career spanning over 30 years. During this time Chris has set up, led, and acquired highly successful component distribution and EMS companies including Paragon Electronics and JJS Manufacturing.