Archive for category Leadership
The most important space in electronics these days is contract manufacturing. As more of our OEM’s become innovation, and marketing companies, they look to the contract manufacturers to build their products. Just about every company from Apple, to Intel, has yielded the manufacturing of their products to contract manufacturers. And, it is often the company with the best price who wins the order, thus creating a very competitive marketplace.
With CM’s, or to be more specific, in this case EMS companies, who deal with electronic manufacturing, its becomes more important than ever to be able to stand out from the rest of the crowd. In fact, it is vital that with so many EMS companies out there vying for business that if a company wants to be truly successful it has to come up with ways to distinguish itself from the rest of the pack. The question becomes how to do this. How to represent your company as a truly outstanding company, the company of choice, when OEMs are deciding who to partner with.
With that in mind here are ten things that EMS companies can do to be truly outstanding in their market place.
- Get your name out there: There are over one thousand contract manufacturers in North America alone, and all but a handful of them are unknown. There are literally hundreds of companies with annual revenues under ten million dollars. If you want to stand out and be noticed, you have to develop a marketing and branding plan. You must create your own unique story and get it out to your market place. It is very difficult for people to buy from you if they cannot find you. Develop and implement and good marketing and branding plan. It will be your first step to success
- Be an expert: Decide what you are good at. Determine your niche market, and then sell to that market. Analyze what you do best. What types of companies do you serve best? Why are you so successful serving these companies? List the qualities that make you successful in this market and then build your marketing are that area of expertise.
- Get the quote out fast: I know it is not always necessary, but, more often than not, it is vital to get your quote to the customer as quickly as possible. Your quote package is the first product your customers see. That quote package reflects directly on how you do business, so make sure it is perfect and ahead of schedule.
- Be flexible: Be easy to work with. Do what your customer requires. Always keep in mind that as a CM you do not have your own products, so you are in the business of delighting your customers…whatever that takes!
- Be customer focused: Everything you do is for that customer. You would not be in business without that customer. So, make sure that the customer is in the forefront of everything you do in your own company.
- Know your customer: You are getting married to these customers, and you are delivering their baby, their product, so you must know everything about them, their product, and their market and what it takes for them to be successful. Much more than a vendor customer relationship, as their CM you are their partner in business, so you need to use this premise as a baseline for everything you do.
- Listen to your customer: Part of being customer focused and knowing everything you can about your customer, is listening to that customer. You are building her product the way she wants it done and the only way to do that is to listen to her when she tells you the way she wants it done. This is “the customer is always right” on steroids.
- Create cooperative teams: To have an ongoing, successful relationship with your customers you have to create cooperative teams between your two companies. Each team should have matching key people from both companies, including quality, engineering, production as well as sales and purchasing and program management. To be successful insist on bi-company teams leading both your companies to success.
- Be ready to partner: Partnership is key. Not only a partnership with your customers but also with your vendors and in some cases a partnership with companies that can do what yours cannot such as an offshore company that can handle much larger volume at a much more competitive price. Or a company that can do quick turn prototypes while you only do production.
- Let your customer speak for you: That’s right, a happy customer is your best sales tool. Nobody has more credibility than one of you customers. Work on getting testimonials, success stories and references from your happy customers. Of course, you have to make them happy first!
And one more…always under promise, and over deliver, make your customers, customers for life. Don’t look at their worth as one project at a time but rather look at lifetime worth of business. It is much easier to retain and grow current customers than to keep finding new ones. It’s only common sense.
I recently got an e-mail from a good friend of mine. He has been in the industry even longer than I have, and that’s a really long time. He works for one of the most high-end defense and aerospace companies in the world. His company has also used their technology base to branch out and get involved in other high-tech marketplaces such as very sophisticated medical electronics.
He writes, and I quote:
“I hesitate (slightly) to complain but here goes on two fronts.
My company has to use domestic suppliers for a lot of our products and that is getting more difficult all the time. Our technology is getting so sophisticated that we can no longer use domestic suppliers.
Many people still think that PCBs for defense and aerospace products are simple technology with fat lines and thick boards, but that is no longer the case. New defense and aerospace products require higher technology, not to mention the fact that we have also branched out to bio-medical, chip-scale interposers, and a lot of other technologies, albeit in small volumes. All requirements we cannot get here domestically. Or we can get it domestically but not in a reasonable time frame. Nowadays we have 25-micron lines and spaces. Our target is 75-micron laser vias, thin dielectrics, and other small features. Swiss operations have supplied us with interposers and that will increase. We are NOT designing our own components but we are using commercially available fine-pitch devices. BGAs down to .5mm are now common for us, .3 mm pitch more so, and we are approaching much finer design pitches. But that all-important board on which that finer pitch BGA must be mounted will not come from this country… sadly.
What has happened to common sense? I have tried to treat others as I want to be treated and I know that the board industry is suffering, but for pity’s sake, why do I have to call and ask, “where is my stuff?”. If it were just one board shop, I would say good riddance, and move on. But, it is almost universal among our supplier base, that late deliveries only get discovered when we ask. Again, what the heck?? With the continued decline of the supplier base, one would think that customer service would get better. So, why not?
One former supplier’s rep was not even allowed to attend daily production meetings so she was rarely informed about part status causing delays in responses. What?? The work that our company now undertakes is not the long lead stuff of the past. We need 5 days turns on 10 layers, we need 20 days on 12 layers with Microvias with buried vias. Our domestic suppliers are happy to quote these requirements, but once we place the order, we almost never get the boards on time…if at all, thus leaving us with loaded pick and place machines and people standing by wasting time and money.
I am a little sad that the industry is where it is. It could improve but I’m not seeing it; and just keeping on the same path is not a long-term proposition for success. Being an optimist, I have some hope with some newly discovered suppliers and I’m keeping my fingers crossed that communications with them will not turn adversarial as they often have with our long-term suppliers adversarial.”
Just to be clear, this friend is part of a very good company, a well-known company, one that all high-tech board shops would be thrilled to count as their customer. He has been in the industry a very long time and is now ready to retire or as he calls it “re-purpose” his life. It’s sad that he will leave with this impression of our industry, an industry he has been an integral part of most of his life.
Please note that much of what he is complaining is the lack of good business practices, like open communications, telling the truth when making a commitment and then sticking to that commitment. Letting him know when a board is going to be late. These are things we have been talking about for years and yet we still have not learned how to do them right.
Personally, I still find myself arguing with some of the companies I work with about these things. I once had an ongoing argument with one of my clients about the importance of on-time delivery. He did not see the importance on delivering his boards on time. He even went so far as to tell me that his customers were not complaining so it wasn’t hurting his business, He was right for a while, the customers did not complain…they just walked away quietly without making a fuss. Apparently, they did complain, but with their feet, not their voice.
And sad to say, my friend and his company are not alone. I hear these kinds of stories of frustration about our board shops all the time. I was once invited to a meeting of designers working for another famous high-tech company building products of the future. Once everyone had been seated and the introductions done, the first question from the design department manager to me was. “Dan, can you tell us why all board shops suck?” Next week we’ll talk about what I told him, because like every other story this one has two sides. It’s only common sense.
The hottest topic on the PCB circuit these days is the lack of young people in our industry. As the rest of us get older, it is finally occurring to us that there is no one following in our footsteps, there is no one there to fill our shoes, when we decide enough is enough.
Thinking about this the other day, I remember what it was like when I started in this so industry so many years ago. It was with a company called Maine Electronics, a wholly owned subsidiary of Rockwell International. Originally, I was supposed to be an English teacher, but after about an hour of student teaching, I decided that honorable career that it was, teaching was not for me. So, then I had to decide what it was I was going to do to make a living if teaching was out.
Through a series of circumstances and coincidences and a long story best left form another day, I found myself hired at Maine Electronics as what was then called, a Program Coordinator, a fancy name for an expeditor. My job was to track and report the status of every single PCB in the programs I was handling. In those pre-computer days, taking status and tracking boards was all done annually by myself and seven other Program Coordinators. It was an interesting group. All of us were young, all of us were men of course, it was only much later that management realized that women could track and expedite boards as well as men could, better actually. We were all under twenty-four. And we all had some college, some of us had degrees but most did not yet. All of us with the same demographics politically and socially, which meant long hair and liberal politics which was ironic when you think that we were working on Minuteman missiles and F-11 bombers.
You can just image the fun we had chasing our boards all over the shop, and competing with one another to see who could get supervisors to work on their boards first. It was a time when our technology was respected enough that our customers were used to late dates and catch-back schedules. We lived under a great deal of pressure but as always when looking back at hard times, today when we get together, we consider those the good old days.
I was fortunate to begin my career in a company what was one of the leading PCB producers in the world. A shop was run by very experienced PCB experts from either Rockwell Autonetics in Anaheim or left-overs from the previous company Maine Research which had been designed and built as the most advanced PCB facility in the world. Just to give you an example we were building controlled impedance boards before people even knew there was such a thing.
But the point I want to make, is that we young people were trained every day of the week. Everything we did was a lesson for our future. Once we had been there a year or so they started grooming us for the next step in our career development. Some of us were destined to become process engineers, others were to become supervisors or Quality managers and a few of us where trained as sales people. In other words, from the very first day we were hired we were considered long-time members of the Rockwell family, and training us was considered an investment in the future of the company. Ur managers were tasked with starting all of us on the career path of our choice…within the company.
They were always working on the future of the company, with great intention. There was nothing haphazard about it.
And now, as we look back on the past twenty years how many of us have done that same thing? Not many of us, which is why we are in the dilemma we are in today. I daresay part of it is due to the arrogance of the boomer generation. We’ve always thought that we were the coolest generation with no regard or much respect, for that matter, for the generations that followed us. We thought we would live forever, so why bother looking back? We could not imagine a world without is and so we concentrated on the present with little interest in the future, especially a future we would not be part of.
Thus, here we are, a bunch of old gray men and a few better-looking women wondering how we are going to sustain our industry going forward, wondering who is going to carry the torch into the future.
But here is a reality check for you; it’s not really that we have had a shortage of young people in our shops because our companies actually do have some young people working in them. Take a walk around your shop, look around. Notice anything? Yes, that’s right there are young people there. They have been there all along, working in the plating department or the drill room or in shipping. Yes, they are there but we have not taken the time to notice them. We have not taken the time to talk to them, to get to know them, to find out what they are like, what they like to do when they’re not working. We need to sit down and talk to them and find out what their career aspirations are? We need to work with them, develop them just like those professionals at Rockwell did with me and my fellow Program Coordinators so many years ago. And then we must sit by their side and start working out their career path. Showing them that a career in the PCB business can be a good career. Demonstrating to them just how important our work is. Explaining to them what these little green cards go into and how they are changing the world.
We should make them believe that this is a good industry, an industry to be proud of and an industry that can provide a bright future for the person who is willing to work and to learn. And we should be willing to teach that person and help him or her to become a viable contributing member of our PCB community both today and in the future. It’s only common sense.
Okay, I give up, you don’t have the funds to properly market your company. You don’t have the less than one percent of your revenue that it would take to get your name out there like it should be. Or maybe you don’t want to. Remember the motto of PCB shop owners, “when your sales are low fire your sales people and buy a drill.” So maybe you’re just one of those guys who doesn’t get it. You never had to market your company before so why should you start now. Every time things got hard you just muddled through, cutting corners, and laying off people and holding costs until the business came back…because it always did, sooner or later. You’re not sure why, but it always did. So now even if business is down you see no reason to do anything but the same thing you have always done and that is…do nothing.
Well let me ask you, how’s that going for you? Or maybe I should ask, how did it go for the over one thousand or more North American board shops that have gone out of business in the past twenty-five years? They didn’t do anything either. Some of them just kept buying equipment, equipment that in the end earned their creditors some of their money back. Or they just kept cutting costs to the point where one day, poof! They just disappeared into thin air.
Get this guys, times are not what they used to be. I know that in the seventies and maybe early eighties you could just sit tight and the business would come to you. You didn’t need to market, you didn’t need sales people. Back then all you needed was to build boards and they would come. But back then North America had over eighty percent of the PCB business world-wide and back then there was no Asia factor and back then, well how much are we going to cling to this “back then” stuff. The world has changed get over it, move on and do something about it.
And if finally, you get the point and at last realize that you are going to have to do something, here are three easy things you can do right now to market your company and get your name out there.
- Send out value-added newsletters about your company. They don’t have to be long and they don’t have to be fancy they just should have information that your customers’ can use. The newsletter should be made up of technical information that will help your customers with their PCB needs. They key is to build a data base of customers and potential customers and get your newsletter out on a regular basis, say about every six weeks. This means that with very little effort on your part your customers will be hearing from you on a regular basis. And once you have their attention you can stick in an offer that will serve as a call to action for them to start buying from you.
- Write and publish a regular column. There is something about appearing in print that somehow makes you an expert, whether or not you are one and believe me I know. You can write about a specific technology, or service that your company is good at. Writing a column will go a long way towards branding your company. And once columns are published you can use them for your own marketing efforts as well
- Issue press releases: This is the easiest one of all. Put together and send out press releases about your company when you buy a new piece of equipment or hire a new sales person or a new director of operations, or you are heading to a trade show to exhibit. This will keep your name out in the market and the best part it cost nothing. Done right, a well-written press release is as good as a paid ad.
And speaking of ads, there is one more, always under promise and over deliver. And my apologies, this is a bit of a commercial, but an important one. Spend a little money on some advertising. It cost much less than you think, and a publication such as Iconnect 007 offers special packages for all budgets. And the neat thing is once you are advertising with a trade-zine such as ours there are all sorts of bonus services that you will get; from free interviews to press release publications to even advice on how to send out the right message.
None of these ideas are difficult and except for the last one, none of them will cost you a penny. And by the way doing these things will help you to focus and define your company’s direction which is always a good thing. It’s only common sense.
Last week, we talked about preparing for 2018 by developing account plans and forecasts. We mentioned that this would be presented, viewed, and discussed by the entire management team at the annual sales meeting that would be held in January of 2018. This week, we’ll discuss that annual sales meeting.
This is truly, the most important meeting your company will hold every year. It is the one time during the entire year where the team comes together and intentionally talks about business for the coming year.
Besides the sales people presenting their slate of account plans, and their customer-by-customer month- by-month sales forecast, operations will talk about what their plans are for the coming year and how based on the sales forecast they will plan production shifts as well as staff the company to meet that forecast.
Engineering will talk about the new technologies they will be coming up with in the next year and when they will be implemented.
Both operations and engineering will present a capital plan, listing expenditures for the coming year including equipment, and facility upgrades and a schedule of when they will occur.
And Quality will discuss any new specs and qualifications and registrations that they plan to achieve or be updating in the coming year.
The marketing department will deliver their marketing plan including a quarter by quarter plan for synergistic marketing that will tie in, advertising, newsletters, and social media. They will also announce the trade shows they will be attending and exhibiting at.
There will also be a download of market information including a study of each market from defense and aerospace to security, to computers, to telecom, to medical and commercial to decide which market to target. There will also be a discussion of the competition; who is winning, who is left, who has gone out of business and why, as well as which companies have grown by doing what?
And finally, the entire team will come together and discuss the company’s strategic direction for the coming year. This will involve setting a complete plan in play for the coming year, including sales tactics based on the customers, technology, and markets that the company will be targeting not only in the next twelve months but also twenty-four, thirty-six and yes, even sixty months.
This team will study, discuss, and make major decisions on a number of key topics including whether or not to develop and implement an acquisition program for buying or merging with new companies. They may decide to develop and implement a roll-up plan where they acquire suffering companies and roll up their business into their own. Or they might decide to vertically integrate and buy an assembly company or a design service bureau so they can offer a total solution from design to assembly. Or alas, they might decide that it is time to call it day and sell the company or worse yet just close it…that’s ugly.
This annual sales meeting is a good time to discuss partnerships. Maybe the team decides that it is time to face facts and start offering offshore services, finally going out and getting some Asian suppliers to complement their own capabilities.
These are all issues that are discussed at this once a year annual meeting. But, the most important thing by far, is that all the company’s key people are together in one room for one, two, three days or even a week. Decided together the direction of the company. This is the real reason for the annual meeting. And therefore, every second of that meeting must be carefully planned. There should not be a minute wasted. Everyone should participate and have their fair representation at this meeting. And yes, everyone should come fully prepared to not only discuss their particular area but also with their strong ideas as the overall direction of the company.
And then there are three things that have to come out of the annual meeting:
- Everyone must be in complete agreement as to the direction of the company once the meeting is over. Inside the meeting room, there can be infighting and chair throwing and loud words and intense arguments. But once the meeting is over all management must come out of that room fully aligned and marching in step toward the company’s future.
- There has to be a communications plan. Once the direction of the company has been decided and everyone on the management team is marching in place, all the managers must go to their respective departments and convey these marching orders. In as little as twenty-four hours everyone, and I mean everyone in the company, must know chapter and verse the direction of the company.
- And the last thing that comes out of the annual meeting is a fully assigned and dated action plan. The plan that will become a working document. The tool, the blueprint, that everyone uses to not only implement that plan but measure that company’s progress against the plan’s dated milestones. Too many companies go to all the trouble of holding an annual meeting only to throw the plan in their bottom drawers and completely forget about it until the following September when it is time to repeat the entire process of annual planning. And that ladies and gentlemen is sheer foolishness.
If you are not planning to have an annual meeting this year. If you are not planning to develop account plans, and forecasts, and capital plans, and engineering plans. Then why don’t you just do yourself a favor and just plan to check out. Call my friend Tom Kastner and start the process of selling your company while you still have something to sell. It’s only common sense.
All customer service starts at the top. It’s a cultural thing. To have great customer service you have to have respect for your customers, everyone in the company has to respect the customer not just the customer service people.
Look, it’s pretty easy to pass everything along to the customer service people (by the way when I say customer service people I also mean inside sales people because I have found that in our industry these terms are pretty much interchangeable). So for the record here, if a company wants to have great customer service everyone in the company and I mean everyone from the owner to the president to the sales manager to the plating supervisor to the maintenance person to the person in shipping and yes to the customer service person everyone has to be completely focused on the customer. Everyone has to live, eat and breathe customer service. Everyone should be staying up nights trying to figure out how to deliver the best possible customer experience on the market today, and the company leader should be personally leading that charge.
You should also remember that when it comes to the ways customers judge your treatment of them you are not only competing against other board shops but you are also competing against the best customer service companies in the world from Disney to L.L. Bean from Tiffany’s to Nordstrom’s. That’s a lot of pressure!
Yes, great customer service comes from the top and filters all the way through the organization. But please be careful. Be very careful because that sword cuts both ways. As the leader of a company you have to make sure that at no time and I mean at no time will you ever bad mouth a customer. If you get angry at a customer, if you get frustrated with a customer or if you just don’t get along with a customer, you never let than show. You never let anyone in your organization hear you bad mouth a customers. The fact is that anything that comes out of your mouth is multiplied ten-fold when it hits the troops. If you are a company president and you publicly knock a customer you are literally yelling to your people that they now have permission to knock that customer as well. You will have set that example and once that happens there is almost no turning back.
Have you ever said something like this?
My sales people are too close to their customers they need to be reminded of who they work for?
Look I don’t care what the customer wants, this is the way we do it here, this is our policy.
So what if we’re late, everybody is late once in a while? We’re a board shop, board shops screw up once in a while, and they are just going to have to understand that.
Man, I hope you have never said any of these things or anything close to sounding like these things. But if you have, then you better rethink your role in the organization because you are sending a terrible message to everyone who works in your company, particularly those who are working on the front lines, like your customer service and sales people.
The point here is that you can come up with all kinds of great examples, ways to deliver great customers service and you can teach them to your customer service people until you’re blue in the face, but if the rest of the organization doesn’t buy into it you are wasting your time.
True company leaders lead, they lead the charge for great customer service. They monitor what their people are saying, making sure that they are always positive when it comes to the customer. They lead discussions and brainstorming sessions to find newer and better ways to “WOW!” their customers. When there is an issue with a customer, a problem to overcome, the true leader will always take the high road and do what is best for the customer and he or she will do it loudly so that everyone in the organization gets the message and completely understand that this is a great customer service company.
We’ve been talking about the president of the company but this kind of positive customer service modeling behavior has to permeate throughout the entire management team, from Directors to General Managers to Supervisors and Leads, everyone has to bring the customer to the table, everyone has to make sure that the people who work for them completely understand that there is no skimping when it comes to respecting the customer. The customer is king and the customer is the one who pays bills; and without customers there would be no business, there would be no jobs and there would be no company. It’s as simple as that.
In short everyone in the company works in customer service, everyone in the company has to have the customer foremost in their minds at all times and everyone in the company has to ask every time there is a decision to be made, “Will this be good for the customer?” It’s only common sense.
…and avoiding getting the door shut in your face
We know it’s tough getting appointments. It’s even tougher getting people to answer the phone; and then once you do get that appointment or that phone call you run up against a stone wall made up completely of attitudes of people who do not want to be sold. People are not only terrified of sales pitches, they out and out hate them. If a sales person comes anywhere near trying to get someone to buy something the person he’s talking to will turn off his mental hearing aid in a snap!
This is not only happening in our business, it is happening everywhere. I just read a book called the End of Advertising: Why it had to die and the creative resurrection to come by Andrew Essex, in which the author, who is in advertising, by the way, talks about the death of advertising as we know it. He points out that with all the ways of watching our favorite television programs fewer and fewer people are sticking around for the commercials. He points out that even those Super Bowl commercials aren’t cutting it any longer. Did you know there was absolutely no uptick in sales from the advertisers in the last two Super Bowls? Those companies who advertised, spending a combined $30 million on one big game each year got literally nothing for their advertising dollars. Actually,the only company that made out was Budweiser because after winning Super Bowl Fifty, Peyton Manning said that he was going to drink a “whole lot of Budweiser.” And he meant it! He wasn’t even getting paid to say it, he just planned to drink a lot of beer,
So, if the big boys are facing diminishing returns from conventional sales and advertising, what are those of us carrying bags for our companies supposed to do? First of all, don’t give up because there is hope, there is always hope and secondly maybe things are not as bad as they seem because at least in our world people are still using what we sell. The key is to sell something they need rather than to try to get them to want what we sell.
In other words, focus on exactly what potential customers need. A good sales person will be adept at finding out what they want, exactly, A great company will provide it. For those of you in the PCB industry, here are some of the things that our customers need at this time. And, if you and your company can provide these things, they will take your phone calls. They will take you up on your request for a meeting and yes, they will notice and read and heed your ads.
Okay, let’s get to it. Here are some of the most important needs your customers have:
- To get the obvious out of the way they of course need high Quality PCBs on time all the time.
- They need worry-free service from their PCB vendors.
Now lets’ get to the good stuff:
- They need PCB expertise. It’s not like it was years ago when our customers (OEMs) were the ones who were the PCB experts and they could tell us what they needed. No, not at all, those days are gone and those experts are gone so most of the people we are dealing with don’t have a working knowledge of our products and technology. That’s something they need and it’s something we must provide if we want to sell them PCB’s. We need to invite them into our facilities and show them how a board is built.
- They also need our expertise. They have to know they can count on us to provide them with the technical knowledge in PCBs they are going to need to build their products both today and in the future. We can provide this to them with manuals, DFM guides, webinars and seminars and lunch and learns.
- They need partners. This is especially true of those companies who are building “products of the future” such as rocket ships and satellites. These companies are sometimes working with technologies that are immature at best and not even invented yet at worst and they need partners to help them get there. Partners, who are willing to share in their mission with time and energy and yes, passion.
- And finally, they need to work with companies they can trust, companies who are going to keep their information secret, companies who they will feel comfortable sharing their vision for the future without fear of exposure to the rest of the market until the time is right.
Selling printed circuit boards is no longer what it once was. It now requires a totally new level of cooperation, dedication, flexibility, passion and trust. The old sales model is broken, the new sales model is the only way we are going to succeed in this new world order. We have to give our customers what they need…not what we want to try to get them to want. It’s only common sense.