Strengthening the Weakest Link: Key to Competitive Advantage in the EMS Supply Chain Market
[ Back ]   [ More News ]   [ Home ]
Strengthening the Weakest Link: Key to Competitive Advantage in the EMS Supply Chain Market

PALO ALTO, Calif., Nov. 30 /PRNewswire/ -- With the RoHS directive coming into effect in July 2006, there will be a lot of implications on the OEM behavior. This directive will act as a driver, which will spur the outsourcing of supply chain operations. There are a lot of aspects to be considered, such as, the need to make sure that the consumption of the leaded components is done on time and also making the new components compliant to the directive.

EMS providers are already gearing up their manufacturing processes to meet the directive and making sure that the transition to the lead free parts happens in such a way so as to avoid excess and wastage of noncompliant components in the supply chain. The lead free process will also increase the expenditure for the new process technology. The conversion to lead free manufacturing will take a significant effort and OEMs will outsource to avoid being caught in the situation.

New analysis from Frost & Sullivan ( http://www.semiconductors.frost.com ), World EMS Supply Chain Markets, reveals that EMS industry earned revenue of $158 billion in 2005 and estimates to reach $320.5 billion in 2012.

If you are interested in a virtual brochure, which provides manufacturers, end-users, and other industry participants with an overview of the latest analysis of the World EMS Supply Chain Markets then send an e-mail to Tori Foster - Corporate Communications at Email Contact with the following information: your full name, company name, title, telephone number, e-mail address, city, state and country. We will send you the information via email upon receipt of the above information.

"The electronics industry is prone to fast paced technology changes," says Frost & Sullivan Research Analyst Lavanya Ram Mohan. "EMS providers have to invest a lot of money to remain within the competition and sometimes to merely stay in the race."

The optimization of supply chain operations is dependent to a major extent on technology. At the end of the day, technology increases collaboration and visibility within the chain. EMS providers will have to keep up with the changing technology and replace or upgrade their existing technology constantly.

The roll out of collaboration tools or planning systems like ERP solutions will be high. It is not always possible for the EMS providers to invest capital to update their in house technology. Uncertainties in technological changes makes OEMs think twice about outsourcing their supply chain operations. Though the cost hindrance of supply chain software is very high, another issue faced is due to implementation and resulting integration issues. It is extremely difficult to integrate all platforms to the same level especially when using old ERP systems.

"Change is a constant struggle for EMS providers," says Lavanya Ram Mohan. "Poor forecasting can prove to be disastrous for EMS providers and their partners as it was witnessed during the downturn of 2001."

EMS providers need to hit both the upside and downside of demand, while at the same time ensuring optimum inventory levels. This is a challenge all the players in the supply chain will have to face, irrespective of their position in the chain as well as the time factor.

EMS providers can buy experience with technology tools, have closer hits than misses on their demand forecasts. EMS providers will need to determine what inventory level strategies they would require to meet the customer demands. Some original equipment manufacturers (OEMs) will demand 95 percent, 98 percent or even 99 percent on time delivery. The key strategy would be to identify what inventory strategy would be required to satisfy the requirement. They need to identify what inventory strategy would be required to compete and dominate in their industry.

World EMS Supply Chain Markets, a part of the 9435 subscription service, provides an overview and outlook for the market. This study has been segmented into Tier 1, Tier 2, and Tier 3. This research includes detailed market opportunities and industry trends that have been evaluated following extensive interviews with market participants. Interviews and executive summaries are available to the press.

Frost & Sullivan, a global growth consulting company, has been partnering with clients to support the development of innovative strategies for more than 40 years. The company's industry expertise integrates growth consulting, growth partnership services, and corporate management training to identify and develop opportunities. Frost & Sullivan serves an extensive clientele that includes Global 1000 companies, emerging companies, and the investment community by providing comprehensive industry coverage that reflects a unique global perspective and combines ongoing analysis of markets, technologies, econometrics, and demographics. For more information, visit http://www.frost.com .

                        World EMS Supply Chain Markets
                                   F022-28

     Contact:
     Tori Foster
     Corporate Communications - North America
     P: 210.477.8448
     F: 210.348.1003
     E: 
Email Contact

     Magdalena Oberland
     Corporate Communications - Europe
     P: +44 (0) 20 7915 7876
     F: +44 (0) 20 7730 3343
     E: 
Email Contact

     Donna Jeremiah
     Corporate Communications - Asia Pacific
     P: +603 6304 5832
     F: +603 6201 7402
     E: 
Email Contact

     
http://www.frost.com

Keywords in this release: hyphenated analytical instrumentation, life sciences, pharmaceuticals, environmental, chemicals, petrochemicals, semiconductor, forensic, defense, homeland security, research, information, market, trends, technology, service, forecast, market share, gas chromatograph-mass spectrophotometer (GC-MS), liquid chromatograph-mass spectrophotometer(LC-MS).

CONTACT: Tori Foster, Corporate Communications - North America,
+1-210-477-8448, or fax, +1-210-348-1003, or Email Contact , or
Magdalena Oberland, Corporate Communications - Europe, +44-0-20-7915-7876,
or fax, +44-0-20-7730-3343, or Email Contact , or Donna
Jeremiah, Corporate Communications - Asia Pacific, +603-6304-5832, or fax,
+603-6201-7402, or Email Contact , all of Frost & Sullivan

Web site: http://www.frost.com/
http://www.semiconductors.frost.com/