Matthias Holsten, co-founder of “EMS SCOUT”, the largest search portal for EMS services in Europe, summarizes after “electronica 2022” in Munich how product developers and EMS service providers can learn from crises and improve their cooperation in the future.
It’s like a roller coaster ride lasting almost three years, on which the crisis-ridden electronics industry is shaken up from phases that sometimes seemed powerless and shaken up to new life. On the last day of this year’s “electronica” in Munich, Matthias Holsten, change consultant in the electronics industry, commented on the conclusions he and his team took home from the discussions with the trade fair visitors. “The great blessing in disguise was that with Corona and the war on our doorstep, almost all product development companies, all OEMs and EMS service providers, with a few exceptions, were equally affected by the crises and in many companies still are “, says the Hamburg consultant, “for the first time in our industry, this sharpened the focus on something like a collective problem awareness.”
Allocation problems, delivery problems and production dates that were sometimes postponed into the unknown raised the same question, not only among all those affected, among OEMs and electronics manufacturers, as to how things could go on. Partly on the edge of existence and the production standstill, the dilemma was recognized across the board: The “same procedure as every year” weighed many of those involved in the game of forces in the belief that everything would take its course and nothing had to change as long as the components were available on a large scale and the whole thing works, the purchasing department behaves primarily in a price-sensitive manner and the EMS employee focuses on capacity utilization.
More professional support is required
“We assumed that at the trade fair we would primarily have buyers and OEMs at our stand who wanted to use the EMS SCOUT tool to find alternative EMS service providers in their region and be satisfied with to solve everything else yourself”, Holsten explained. According to him, many of the visitors were more interested in individual advice. The sudden interest in wanting to enter into new business relationships with EMS service providers, which one intends to sound out more with professional help according to qualitative aspects, outweighed: “There is a kind of rethinking taking place, especially among buyers. Previously, a service relationship once entered into was stable for years. Basically a good sign. However, when product development turns, for example to higher quality product production is transferred or the quantities increase significantly, these relationships with the EMS may suddenly no longer be correct.”
For the industry-experienced management consultant Holsten, it was clearly recognizable in the trade fair talks that the crises of the last three years among buyers contributed to the fact that business ties were more closely examined from these aspects than before. The reason for this was also stated that OEMs now internally brief their buyers differently, more detailed and thus more in-depth with their component requirements. There is also a greater willingness on the part of the EMS companies to open up, to exchange ideas, to tackle purchasing bottlenecks together. There are also fewer reservations than before about compensating for excess capacity utilization or production levels through internal subcontracts. “For me, an indication that the scars are slowly healing, that one draws fruitful conclusions from necessity, from experience, which help to better weather crises in the future through more public spirit, through cooperation instead of isolation.”