Increasing electronics OEM hardware functionality and complexity combined with product life cycles becoming shorter and shorter is driving the need for better new product development processes and more effective management applications when launching new product introductions (NPI).
This is especially true in non-traditional markets such as industrial electronics, automotive, aerospace/defense, and medical electronics due to the nature of extended supply chains requiring additional layers of tracking and repeatability – where field failures can play a difference between life or death.
Contract EMS manufacturers can no longer claim to have in-house NPI services and expect electronics OEM customers to then just follow the EMS provider’s instructions and guidance.
Savvy OEM decision makers with extended contract EMS manufacturing supply chains know they still need to be an active participant to keep things aligned.
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Discussions with industrial electronics OEM team members who focus on NPI today often place increasing emphasis on specific electronic design automation tools they want EMS firms to be using. These OEM NPI decision makers also express concerns about the lack of information flow coming from their EMS partners during NPI project start and evolution.
Understanding internal EMS factory NPI program costs, challenges, and EMS industry generally accepted NPI standards is helpful for OEMs wanting to stay two steps ahead of their EMS partners with regards to NPI program execution or, at the very least, what should be happening with their NPI program.
Add to this, OEM executives cannot afford to disregard NPI product costs, or EMS partner delays.
Focus. Focus. Focus.
Unless your new product will compete in a vacuum, every OEM NPI eventually faces continuous pricing pressure from end markets.
Your product needs to be built at the right quality, at the right time and, so on, and, while your OEM new product cost remains important, you also have your product total landed cost objectives. And, once your NPI launches in the market your total landed cost objectives becomes your focus.
As you face continuous margin erosion, you try countering this by introducing other new products. But, whether your company has a team of 10, 100, or 1,000+ people responsible for NPI portfolio management, knowing the right information to focus on for your NPI program managed by EMS manufacturers can help keep your program, and corresponding EMS provider employees (whom you have no real, direct authority over) aligned.
To help meet your NPI program goals and objectives participating EMS and OEM teams members will usually include at least the following functions:
- EMS provider quality engineer
- EMS NPI process engineer
- EMS test engineer
- EMS production process engineer
- EMS component engineer
- OEM manufacturing test engineer
- OEM quality engineer
EMS providers are tasked with reviewing and updating customer NPI program documents frequently as changes occur. Being able to anticipate any changes to your NPI roadmap, or costs, ahead of time can help your company to launch new products with confidence and a more resilient contract manufacturing supply chain with better cash conversion that can have lasting effects on how your supply chain works to further support your total landed cost objectives.
Below is just one example where the following (reasonable) target spec goals and objectives might be established for a new program build and launch inside an EMS factory:
| Process | Prototype | Pilot | Pilot+90 Days | Pilot+180 Days |
| PCB Assembly ICT | n/a | 80% | 93% | 96% |
| PCB Assembly Functional Test | n/a | 85% | 95% | 98.5% |
| Systems Functional Test | 80% | 95% | 98% | 99.5% |
| RMA* | n/a | n/a | .25% | .10% |
As your NPI program progresses in your EMS provider factory, many new product cost reductions, especially on EMS box build and mechanical services, often times need design changes where there is an R&D cost surrounding these.
Most OEM equipment companies will have opportunities to introduce new products depending on several factors like how commoditized your market is, how aggressive your company is, financial stability of current EMS partners, program, sales and market growth, to mention a few.
But for the majority of OEM equipment firms, R&D investments are better spent on introducing new products. This sounds easy if you only have a few product lines. But when you have 100 or 100s of products your NPI teams have to evaluate at the same time things become considerably more complex.
Handbook on NPI product launch (30 pages)
Learn more about new product NPI program launch and management in your 30-page handbook you can request here.
Our handbook is divided into the primary topics below, with several topics going deeper, with detailed industry examples and clear suggestions and checklists for readers to consider:
- OEM Outline for Electronic Prototype and New Product Development
- EMS Manufacturing Request-for-Proposal (RFP) Terms
- EMS Manufacturing Request-for-Quote (RFQ) Best Practices
- EMS Manufacturing Industry Quote Pricing Drivers
- EMS Manufacturing Program Workflows, Flowcharts
- EMS Manufacturing NPI Systems Integration (Box Build) Checklist
Our handbook can help guide OEM equipment manufacturers when formulating and benchmarking their new product launch roadmap and strategy. Request this handbook.
