Focus on Business

Susan Mucha

Strategic conversations are key to sustaining existing business.

The current business environment is creating two significant challenges for mid-tier electronics manufacturing services companies at a strategic planning level. The first is program management workload. Material exceptions have become the norm, and program teams have become highly reactive to respond to changing program variables. Second, material constraints are causing OEMs to keep projects at their current suppliers and push out launch plans on new products. Taken together, planning for account growth beyond what is automatically going in the pipeline based on spikes in existing demand may not be a great use of program management time.

While it is unlikely a significant number of projects will be awarded in the short term, a lot of dynamics in the background make strategically assessing larger accounts an important activity right now. These include:

Read more: Handling Program Management Workload and Material Constraints

Sue Mucha

Tips to avoid burnout while applying resources to mitigate the impact of two years of Covid.

By the time this is published, we will have been working in “Covid new normal mode” for nearly two years, which means EMS program teams have been working under extreme stress for longer than most physical bodies can handle. This is creating two big dangers: physical damage caused by exposure to long-term stress and disappointing customers becoming acceptable because so many variables are outside of the program team’s control.

In the ’80s, one of the management associations I belonged to had a stress management seminar built around the movie Twelve O’Clock High. The movie is set in England in WWII and follows a new squadron commander from his optimistic arrival through his total burnout. The seminar focused on behavior changes related to command stress in situations where the odds were against most crews surviving, including a rise in irritability, an increase in alcohol consumption, insomnia and a breakdown in decision-making. The commander in the movie experienced a physical and mental breakdown.

Read more: Alleviating Stress and Avoiding the Cult of Mediocrity

Susan Mucha

Be quick with customer forecast review meetings when orders slow.

I believe 2022 will be a pivotal year for most electronics manufacturing services (EMS) providers. Material lead-time and availability issues are slightly improving, and supply-chain executives are cautiously optimistic about a return to normal in mid-year as demand levels out and additional chip manufacturing capacity comes online. That said, a return to normal brings its own set of challenges, if past cycles of this nature are considered. It is particularly important for EMS program managers to start considering the issues likely to come with a mid-year pivot:

  • Forecasts on some products may drop substantially. While component manufacturers, distributors and EMS companies typically have checks and balances to identify situations where customers have increased forecasts as a hedge against allocation, uncharacteristic demand spikes make those controls iffy at best. Most EMS companies have orders into 2022 and exceptionally high levels of inventory in-house. Any downward trend in forecasts should trigger a forecast review meeting with the customer to determine how rapidly orders and inventory levels need to be adjusted.

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Susan Mucha

The wrong attitude can send customers shopping for a new EMS provider.

I frequently say program management is the most difficult job in the electronics manufacturing services (EMS) industry. Program managers play a dual role of their customers’ champions within their organization and their employer’s enforcer to ensure each account hits its revenue and profit targets. I see great similarities between PMs and airline gate agents, for whom getting customers where they need to go is often impeded by forces outside an agent’s control.

If we use that gate agent analogy to describe the program manager’s dilemma in today’s chaotic materials situation, the plane is running four hours late; the passengers who were loaded an hour ago now need to be told the crew needs to deplane because they’ve exceeded their legal flight time limits, and there are no alternate flights because a bad storm has shut down the entire East Coast. The state of imbalance between supply and demand in today’s materials market is so bad, the issue isn’t whether customers will be disappointed but how badly they will be disappointed. Program managers are the point people in delivering that bad news.

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