Smart Grid Funds
By · CommentsBetter times are ahead for technology companies offering cutting edge products to utility companies. According to research company IDC Energy Insights, in the current year alone, total spending related to the smart grid will exceed $10.75 Billion, up 40% from last year. Items to be manufactured would be communication modules, home thermostats, power transmission and energy storage products. Coupled with increased consumer visibility and the demand for in-house displays, manufacturing companies will be scrambling to fill shortages of semiconductors, LCD panels and related products.
In the state of California there exists a number of tax credits for homeowners to upgrade and/or use alternative methods to energize their home. Our hope is that this growth and incentive remains on the upswing as it is good for business and our economy, not to mention the overall health of our environment.
Midsize Companies Growing Target of Cybercriminals
By · CommentsAccording to a recent study conducted on behalf of McAfee, more than half of the midsize businesses surveyed stated they had experienced an increase in security breaches over the past twelve months. McAfee arranged for a study of 900 midsize companies covering the countries of the United States, United Kingdom, China, Australia, Canada, France, Germany, India and Spain to determine not only the frequency of breaches but also the companies’ investment perspective toward prevention.
McAfee’s report, The Security Paradox, continues on to point out that even though there has been a significant increase in cyber attacks, a number of companies have either frozen or cut back on costs related to IT budgets. According to McAfee, almost 40 percent of the companies trimming their IT security budget plan to limit the purchase of new security products. And more than a third are switching to cheaper security software to cut expenses, even though they realize that may put them at greater risk.
While many companies carry a higher level of concern and awareness about increasing cyber threats, the pressure on budgets and resources has served as a disincentive for continued investment. Unfortunately, this creates a vicious cycle of breach and repair that costs far more than prevention. In McAfee’s report, they proceed to explain that the cost of dealing with a security attack far outweighs the cost of prevention in the first place. Based on the survey, over the past twelve months, one in five of the companies surveyed lost $41,000 in sales, on average, as a result of a breach. McAfee’s research shows that organizations that put more effort on preventing attacks can end up spending less than a third as much as those that allow themselves to be at risk.
Another interesting perspective common in midsize companies is the belief they are less prone to risk from cyber attacks than larger companies. Over ninety percent of the companies surveyed with an employee base of 500 or fewer felt they are protected from cybercriminals and believe they face a greatly diminished risk than do larger companies. But, as the report goes on to state, companies of this employment range averaged about 1.6 times the number of cyber attacks at companies with an employment level of 501 to 1,000.
While not addressed in the report, it is important to point out that regardless of how proactive a company is with regard to its IT security, that is simply a beginning point to a company’s overall exposure. If a company’s suppliers become disrupted due to a cyber attack, it have can long reaching impact on the company’s image and profitability. For example, failure of a supplier to deliver needed components for a production run due to disruption of its operating system can create delays in the company’s production and result in late deliveries possibly carrying substantial penalties; not to mention the long-term damage to a company’s reputation and performance rating. When such an event occurs, the company finds itself in a critical shortage situation for needed electronic components and must reach out to alternative sources to fill its production requirements; usually at a greater unit cost than budgeted.
It’s obvious that the focus on cyber attacks continues to be a major concern to everyone. While pressure on budgets continues, it is critical that companies not forfeit the protection needed to insure the necessary level of protection. It may be an issue companies need to raise not only within its own operation but with its key suppliers also.
Hospitals Going High-Tech
By · CommentsHow about a new term for your doctor – Tele-Intensivist. This is a doctor that can monitor critically ill patients from a remote site employing the latest in technology; even allowing the doctor to speak with the patient while visually interacting through video monitors. With the improvement of technology and the increased dependability of electronic components and equipment, doctors can greatly increase their oversight of a larger number of patients without the restrictions of time and geography.
And technology is becoming prevalent well outside of the critical care arena. In areas such as supply cabinets with biometric thumbprint readings, websites where patients can view test results, computerized record keeping and 3D imaging, high-tech products are integrating into the medical community as a whole while creating efficiencies necessary to assist in controlling medical costs for all. Additionally, high-tech equipment is creating a much safer environment for patients. The equipment leads to a quicker diagnosis, shorter hospital stay and helps to limit complications. In fact, an American Hospital Association survey found that at the nation’s 100 most wired facilities, risk-adjusted death rates were over 7 percent lower, on average, than at other hospitals. To further protect patients, healthcare facilities are moving to a “closed-loop” system with built in safeguards at each step of the prescribing process. When doctors enter orders on the system, the computer checks for allergies or drug interactions and confirm the proper dosage. Then, when the prescription is transmitted to the pharmacist, the safety checks are repeated and an electronic “stamp of approval” is issued. Drugs are stored in locked dispensing cabinets and the only drawer that opens is the one specifically holding the patient’s medication. When picked up, the nurse will then scan the medication’s barcode and match it to the patient’s wristband. Utilizing such a system has dropped error rate to less than one percent and allows for quicker treatment of critically ill patients.
With the recent emphasis for the medical industry to upgrade its record keeping systems to electronic formats and the growing use of remote analysis of patients’ tests results, it appears as if the medical field will continue to create a growing demand for equipment utilizing all sorts of electronic components, monitors and related hardware. There is no question as the medical industry’s demand for high tech environments and equipment ramps up, there will be a significant number of critical shortages and electronic component requirements that will need to be address by companies looking to meet future production schedules.
On the Hot Seat – Component Shortage Buyers
By · CommentsCan you feel it coming on? Remember the last time we rebounded from a down-turn in the electronics industry. All of a sudden, companies around the world had desperate needs for all sorts of components and nowhere to turn. Well, with OEM Executives’ ongoing caution of the recovery and still unsure of its customers’ demands, material orders appear to be below the aggregate demand needed. With recent capacity reduction implemented in key component areas limiting the ability of some suppliers to respond to the modest increase in demand, any incremental increase in demand may result in significant supply issues.
And, as reported in CCS, some component delivery times will greatly exceed previous levels. The components expected to be most impacted are: CMOS Logic, FLASH-Memories, Interface ICs, Suppressor Diodes, Al Electrolytic Capacitors-SMD, Ceramic Capacitors-SMD, Film Capacitors-EMI suppressed, Resistors-NLR, Tantalum Capacitors-wired, Film Capacitors-wired, and Switches- (Toggle / Slide)
We all know that being an electronic component buyer is difficult enough. But, when it comes down to solving shortage issues, it appears as if the world just became a tougher place and looks to remain that way for quite some time. While component shortages represent a very small portion of a company’s overall component budget, it tends to consume a significantly large portion of a buyer’s time. According to COMPONENTSResearch, solving shortage needs may take up to 40% of a buyer’s time.
With the present and looming shortages that many are surely going to face in the near future, now is the time to establish relationships with companies that have both the history and the capability of solving your shortage issues. While you may not need their services today, when the time comes that you must have those missing components on your dock immediately, it’s great to know that you have prepared for that eventuality.
Great News for American Manufacturing
By · CommentsPresident Obama has appointed Ron Bloom as the White House Senior Counselor for Manufacturing Policy. Mr. Bloom is well known to be a strong advocate for the retention and further development of what has historically been a key element to this country’s success – our strong manufacturing know-how and base. His feeling is that we need to quit simply “jaw-boning” about retaining onshore manufacturing capabilities and start taking positive actions to maintain this valuable asset of American enterprise.
And, this is a man who actually walks the walk. After working for Lazard Freres and then starting his own investment firm specializing in restructuring North American manufacturing companies, Bloom walked away from his firm in a renewed effort to support U.S. manufacturing. He has spent the last decade working as a special assistant to Leo Gerard, the President of the United Steelworkers. As Gerard stated, “He walked away from investment banking because of his values and commitment to manufacturing…..He really believes that you can’t have a successful economy unless you have a strong manufacturing sector.”
Of equal value is Bloom’s personal history in assisting in the restructuring of over 50 companies. This has provided him with invaluable insight into what it takes for a manufacturing firm to be successful; real world experience at a time when it carries the greatest of premiums. Robert Baugh, executive director of the AFL-CIO Industrial Union Council stated that he felt the appointment of Ron Bloom to the position of Senior Counselor for Manufacturing Policy is “the best thing that could have happened for manufacturing.”
It’s great to know that we finally have a strong advocate for American Manufacturing with access to the President. Perhaps now, we will start to see positive actions out of Washington to insure the continued presence, success and growth of manufacturing enterprises within our borders along with the employment that such growth promises.
Move Over iPhone, The Cliq is Here
By · CommentsMove over Iphone, Motorola has done it again and postured well to gain the kids’ attention this holiday season. Have you seen Motorola’s new cell phone device? We haven’t seen anything this cool out of them since the ever so popular Razr, which basically redefined and set a whole standard for the market a few years back. The new device is called “the Cliq’ and hosts a number of power features such as a 5megapixel camera ( iphone is only 3 mega pixels), social networking software allowing ease of use of facebook and email accounts, as well showing friends “status’ on the home screen.
The Cliq, which Motorola unveiled in September, uses Google Inc’s “Android” software – modern, well written operating software that allows many people to do many different things with their phones. Motorola plans to unveil a second Android phone sometime in October. It will also be available for the holidays.
There are thousands of apps already available for Android software. The phone offers a host of distinctive features that truly set it apart from the IPhone and Blackberry.
Jim Kelleher, an analyst at Argus Research, says “ the Cliq may be Motorola’s best stab at the smart phone market thus far. I think for Motorola to retain its tech edge and reputation for engineering, it really has to hit a home run — not necessary with this particular phone, but with its phones in the coming year, including this one.”
Outside the U.S., the Cliq will be known as the Dext. It will be available through wireless carrier Orange in the U.K. and France, Telefonica in Spain and America Movil in South America.
Good Job Motorola, we would expect nothing less from such a superior organization that defines todays technology trends in PDA and cellular devices.
In the perfect world, you would always be able to buy direct from manufacturers. But in the real world, there are times you need to do business with distributors, rep-firms, and independents. Before you put your trust – and your reputation – into the hands of any distributor, take the time to ask yourself these eight questions basic questions.
1. Is the company ISO 9001:2000 and AS9120 certified. A lot of brokers will boast that they are ISO certified but, in today’s market, basic ISO is not stringent enough to screen for counterfeit parts. And, before buying anything from the independent market, it’s important to make sure that your supplier’s quality protocol is Military/Aerospace grade, so you know you’re getting authentic, perfect material every time, without exception.
2. Does the supplier have a solid facility with a ‘bricks and mortar’ warehouse, an entire department devoted to shipping and receiving, and the staff to screen for quality assurance. Many “brokers” are just one-man shows who work out of their garage and ship components from the nearest FedEx at Kinko’s shop. The risks of doing business with an outfit like that are obvious. A quick check of the address on Google Earth will show you whether the location is an actual warehouse or just a suburban home.
3. Do they field an experienced team? Again, that means more than one person wearing all the hats. But it also means that you’re working with experienced veterans who know what they have, where to get what you need, and how to get it fast. Any competent distributor should have multiple purchasing agents screening through the OEM and CM excess inventories of the world. That way, when faced with a big shortage, you’ll know your supplier has many minds leveraging their collective knowledge and experience to meet your needs.
4. Does the broker have a bulletproof quality screening process? You can screen the broker, but it’s the broker’s job to screen their suppliers and all the components they get on your behalf. They need to make sure their supply stream is completely traceable and without compromise from unqualified sources, so yours will be too. Choose a distributor that is ahead of the curve in Quality Control. The counterfeit market is very savvy these days, and many ISO certified distys do not have the testing in place to discern what is authentic and what is not.
5. How many accounts does your sales representative handle? You don’t want to deal with someone who is spread so thin that they can’t give you the attention you deserve. You want someone who is always available and able to help in any situation. In fact a good sales rep at your distributor of choice– should be almost like having a virtual assistant. You want someone with experience, strong work ethic and that cares about keeping you on their client list for many years.
6. What kind of engineering support does the company offer? Procurement effort can be confusing with upscreening, exact crosses, drop in replacements, programming, erasing, and testing. A distributor with a good engineering team knows what will fit your needs and what will cause component system failure and weed them out so you won’t waste your time and your company’s resources sorting through options that are not viable.
7. Get references. Any company that meets all of the above criteria and will be a true extension of your organization should be able to provide multiple references from Fortune 500 companies proving their track record.
8. Make sure your distributor has a web based forum where you can submit RFQ’s and get a confirmed quote same day, access unlimited data sheets, and track your shipments. Having to call into a phone system every time you need to expedite a request can be tedious and time consuming. Make sure your distributor can handle all of your requests electronically in addition to giving you the hands on service that you expect. Click here to submit your RFQ.
Big Changes coming to EMS Industry
By · CommentsAs the market rebounds from this historic economic downturn, expect to see some major changes in the EMS industry as companies and their shareholders try to recoup serious losses and position themselves for the future.
Look for smaller companies that focus on narrow niche specialties like medical, industrial or aerospace. By specializing, they can concentrate all their time and resources more efficiently, keeping margins down and profits up. Larger EMS providers, which dominated the market in the past, will be left to fight over the less specialized consumer, computer and communications business. Those areas make up a large core of the market, but also have lower margins.
Some larger OEMs may turn to insourcing more of their manufacturing, taking a page out of playbooks that have been very successful for both Nokia and Intel. Keeping more manufacturing in-house puts the OEM in control and reduces the costs and headaches that can come from dealing with an EMS provider.
Finally, expect the explosive growth of Original Design Manufacturers to slow as OEMs respond to concerns over design innovation and product differentiation – the driving factor in many industries, especially consumer electronics. Outsourcing the design of specific components helped cut costs. Outsourcing the design of entire products has made some OEM’s fear they are losing their competitive edge. Now more of them are talking about recapturing control of conceptualization and master design from their ODMs.
Experts predict the next five to ten years will bring big changes to the EMS industry – specialization, insourcing, and a return to in-house product design. Will you be ready?
Smartphones Getting Pico-Projectors
By · CommentsTiny pico-projectors set for huge growth
Smartphones are getting smarter with new embedded projectors capable of showing up to 50-inch bright, diagonal images on any wall or surface. The first one – the Show Phone by Samsung – was unveiled earlier at the Consumer Electronics Show in January and is currently available only in Korea. But the tiny pico-projectors are expected to take off quickly in the international corporate market allowing business travelers to leave bulky laptops and full-size projection systems behind and make presentations directly from their mobile phone or PDA. And you can be sure consumers won’t be far behind, attracted by the ability to share their personal slide shows or YouTube favorites and even movies anywhere there’s a flat surface and a cell phone.
In fact, the sale and shipment of embedded pico projectors is expected to leap from less than 50,000 units this year to more than 3 million units in 2013, says market research firm iSupply. That’s a staggering 60-fold increase in just four years.
There are still some challenges that manufacturers need to work out before embedded pico-projectors can realize their full potential – like power consumption and size. But their ability to overcome screen-size limitations and project a large image from a small device makes embedded pico projectors a perfect fit for the smaller-is-better smartphone market. Expect projector-capable smartphones to start popping up everywhere soon, and get ready for the market to take off.
American Wind Energy Powering Up
By · CommentsMove over Henry Ford. Atlantic Wind & Solar is planning to create an automotive-style assembly line for wind turbines. It’s a move that could dramatically boost the wind energy industry in the United States. And it’s one more sign that companies with ties to the American wind industry – especially component manufacturers – should be gearing up for a big boost in demand.
According to the U.S. Energy Department, our country’s share of the wind turbine market has already grown from less than 30% in 2005 to about 50% in 2008, adding roughly 8,400 jobs in 2008 alone. But more is coming. Twenty-eight states have passed laws mandating that utilities get a percentage of their power from renewable sources like wind. Nordex USA – a U.S. subsidiary of a German wind turbine manufacturer – has broken ground on a new plant in Arkansas that will produce 300 turbines a year by 2012. And now Atlantic Wind and Solar is hoping to create an automated fabrication line that would pump out a completed 1.5 Mw wind turbine every hour. That’s 2,080 windmills each year.
Where will Nordex, Atlantic and companies like them get their components? Right here in the U.S.A.
How do I know? Because experts agree that a local supply chain is more important in wind turbine manufacturing and assembly than in many other industries. Over 8,000 components go into a completed wind turbine. Unlike, say, the electronics industry, those parts are not tiny, easy-to-ship microchips. Many are big and heavy, which means transporting them internationally costs big bucks. That makes now the time for component suppliers to lay the groundwork for growth in this expanding market, building up an infrastructure that will get all those windmills turning.
