A Golden Age of Electronics Innovation in Manufacturing Supply Chain Outsourcing


Philip Stoten, Owner of EMSNow Media

Gold, red, blue and green digital lines

As I see it a number of factors are throwing up another golden age of electronics innovation, led by new markets and supported by enabling technologies, excellent outsourced product fulfillment and good access to venture capital.

So, let’s put ourselves in the shoes of the inventor, why is it a golden age for them?

I want to explore this in three parts: one, the opportunities; two, enabling technologies; and three the outsourced supply chain.  The critical forth factor is the availability of cash, which is another article in itself.  But rest assured it’s there and it’s ready and waiting for good ideas, be it in the form of Kick-Starter and other crowd-funding sources, business angel funding, technology partnerships or traditional venture capital.

Opportunities in Manufacturing

I can’t remember a time when I have seen so many sectors, some completely new, so full of opportunity, and opportunity for new players with creative solution!

Take the automotive sector.  I’ve talked at length about the collision of supply chains as our connected consumer life continues seamlessly into our cars.  This is just one area of development and opportunity.  There are also piloted or driverless vehicles, safety, infotainment and all the elements that go with smart transport and smart cities.  This sector alone suggests close to 100% growth in electronics content over the next few year.

Another sector getting a lot of attention is wearables.  This sector is one of those exciting new ones where we’re not replacing old technology with new, but creating brand new products and brand new product groups that support the links between apparel and electronics.   This sector also crosses over into medical, health and fitness - all areas where new products are breaking through and changing lives for the better.

You have to be happy for the industry when a new technology creates a new market, particularly when it does not have a negative impact on another.  The iPod was a replacement for the old Walkman technology, bringing much more electronics and replacing a largely electro mechanical solution.  The iPad, whilst creating a new market for tablets, has clearly impacted negatively on the laptop computer market, which in turn has all but decimated the desktop computer market, but the industry growth as a whole has been impressive.  Some sectors like the medical electronics market (e.g. blood glucose meters) and the alternative or sustainable energy markets, just feel like they’re both opportune and good for us all.

There’s the opportunity for the inventor, but what enablers are making the job of innovation easier?  The answer is plenty!

Enabling Technologies

One obvious enabling product or technology is the smartphone, creating opportunities for software and hardware innovation.  App development has created numerous millionaires and enabled the use of the smartphone as the brain of a product that connects to a device or appcessory - I know it’s not a real word, but trust me it soon will be.  Having a device in everyone’s hands that houses not only a processor, but also an accelerometer, a navigation system, a camera and an audio device, all connected to the web, allows the creative mind to run free, coming up with all kinds of wonderful ways to utilize some or all of these functions.

Another exciting development and enabler getting a lot of attention is 3D printing.  We’ve spent many years printing a lot of stuff we don’t need including strange puzzles and ships in bottles, but now we’re printing body parts and complex joints for surgery and really starting to see value and market potential in this technology.  And let’s not forget its value in bringing product to market faster through immediate and economic prototyping without tooling.

MEMS (Micro-Electro-Mechanical Systems) is another technology that simplifies the development process.  Put simply all electronics systems include elements of sensing, processing and actuation in some form or another.  MEMS are the economic solution to make this happen.  Other really cool technologies like Intel’s Edison device (http://www.intel.com/edison), launched at CES (Consumer Electronics Show) this year and the Internet of Things (IoT) all create great routes to new product development.

The Outsourced Supply Chain

The third factor and perhaps the most important to the readership here is the way the electronics manufacturing industry has developed to nurture innovation.

When the EMS (Electronic Manufacturing Services) industry started it was to work as a contractor for OEMs (Original Equipment Manufacturers) who wanted to smooth out the peaks and troughs out of their manufacturing cycles at a competitive price.  It quickly developed up and down the value chain and has more recently become a sophisticated solution that allows the innovator to focus on research, development and marketing and leave every part of engineering, manufacturing and fulfillment to an outsourced partner.  This can be done with such speed and scale as to bring an innovation to market quickly and into every market in the world without the brand owner knowing the first thing about the process.  Happy days I say!  Let’s keep those creative minds focused on coming up with the next hover-board rather than concerning themselves with economics, manufacturing excellence and logistics.  The supply chain nerds can take care of that!

So, more opportunity than I can remember, enabling technology that suggests that if you can invent it, it can be made, good access to capital and an electronics manufacturing industry that wants to nurture, protect and develop your ideas.  Sounds like a great time to be an inventor.  And if you think everything we needs has already been invented, remember that we had no idea we needed computers, the internet or even mobile phones until someone said we could have them, now we can scarcely live without them and internet access is considered a basic human right.

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