In search of profitable western PCB production, Part 1: yes, there is money to be made building boards--and supplying materials to board shops--outside Asia.The PCB PCB: see polychlorinated biphenyl. PCB in full polychlorinated biphenyl Any of a class of highly stable organic compounds prepared by the reaction of chlorine with biphenyl, a two-ring compound. industry in Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). and North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. evolved from
high-volume manufacturing into a much more specialized spe·cial·ize v. spe·cial·ized, spe·cial·iz·ing, spe·cial·iz·es v.intr. 1. To pursue a special activity, occupation, or field of study. 2. , time-critical model. As this change has occurred, few manufacturers have managed to maintain profitability, but the broader masses of previously successful companies are struggling to do so. What are the characteristics of profitable Western PCB production, and what are the likely drivers for manufacturers trying to survive and thrive in the years to come? For PCB producers searching for profitability and material suppliers who want to continue supporting the local industry, finding answers to these questions is vital. How can Western manufacturers and suppliers be sure that their products meet the needs of the local niche players, the profitable niche players? This article will detail some of the more common value drivers and requirements of the Western PCB manufacturing market. It will also provide an example of how DuPont Dupont, DuPont, Du Pont, or du Pont may refer to: Companies
QFD Quantum Fluid Dynamics QFD Quality Functional Development QFD Quincy Fire Department (Massachusetts) ) and other techniques to translate industry needs into product attributes for a successful material offering. The material in the example is DuPont Riston Riston is a civil parish in the East Riding of Yorkshire, England. The civil parish is formed by the village of Long Riston and the hamlet of Arnold. According to the 2001 UK census, Riston parish had a population of 630. dry film photoresist A film used in photolithography that temporarily holds the pattern of a circuit path or microscopic element of a chip. When exposed to light, it hardens and is resistant to the acid bath that washes away the unexposed areas. Not to be confused with photoresistor. . However, the described market analysis techniques can be applied to other suppliers' materials, products offered by PCB manufacturers--just about any company with a product or service. Value Drivers For Western Profit Likely the most effective way to achieve profitable Western PCB production is to differentiate your company from the "new" competition in Asia, and not compete with Asia head-to-head head-to-head adv. & adj. 1. In direct confrontation or conflict at close quarters: The two brothers went at it head-to-head. It was a head-to-head contest all the way. 2. . Differentiation can be achieved by promoting the unique advantages of companies in Europe and North America in terms of geography, language/communication, innovation, local support and an assurance to the end-user (job) end-user - The person who uses a computer application, as opposed to those who developed or support it. The end-user may or may not know anything about computers, how they work, or what to do if something goes wrong. of continuity in local supply. Further, safe handling of sensitive information by local manufacturers can be of great importance in industries that don't don't 1. Contraction of do not. 2. Nonstandard Contraction of does not. n. A statement of what should not be done: a list of the dos and don'ts. necessarily want to pass on the latest technology to more remote, possibly uncontrollable markets. TABLE 1 lists the key value drivers for profitable PCB production in Europe and North America. Probably the most frequently mentioned type of activities for these regions are quickturn and prototyping, mainly due to the fact that lead times can make or break valuable projects with end-users. The sensitive nature of military and defense applications make this a prime field for local manufacturing. However, dependence on military work can be tough for PCB manufacturers over longer periods, since spending is highly variable due to the current political climate. Medical electronics demand a high degree of specialization A career option pursued by some attorneys that entails the acquisition of detailed knowledge of, and proficiency in, a particular area of law. As the law in the United States becomes increasingly complex and covers a greater number of subjects, more and more attorneys are and are not necessarily long runners, and thus are not well suited for standardized standardized pertaining to data that have been submitted to standardization procedures. standardized morbidity rate see morbidity rate. standardized mortality rate see mortality rate. high-volume production in low-cost regions. The high risk of liability, especially for devices implanted im·plant v. im·plant·ed, im·plant·ing, im·plants v.tr. 1. To set in firmly, as into the ground: implant fence posts. 2. in the human body, make medical electronics a field where device manufacturers enact strict requirements that cannot necessarily be met by foreign competition, nor appropriately controlled. A high product mix and short runs are "bits and pieces" that would disturb large manufacturers focused on volume production. Many such applications are made in volumes too small to interest the Asian players. This is where Western companies have a chance to develop positions for profitability. Contact-intensive applications, which might involve design assistance, are severely impacted by distance, language and time differences. Even though technology has improved global communications, direct contact in the customers' own tongue is hard to beat. It is essential for material suppliers to understand the needs of the profitable markets that will remain in the West. Suppliers must analyze market needs in order to develop products to support profitable Western activity. Material suppliers cannot be expected to support failing business models in Europe and North America, those solely based on driving the cost side of business to compete head-to-head with Asian companies. What specific capabilities should European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. and North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. board manufacturers possess? A time-critical, quickturn and prototype operation needs to have significant production flexibility and a broad range of capability, as well as short set-up times to minimize order lead times. Prototypes can also vary substantially in type and scope, so the manufacturer has to maintain a broad capability to solve a number of processing issues and still maintain an efficient production flow. TABLE 2 lists a number of key capabilities that PCB manufacturers must develop and maintain to succeed in the West. Military and defense applications may utilize a variety of different materials besides FR-4, including polyimide Pronounced "poly-ih-mid." A type of plastic (a synthetic polymeric resin) originally developed by DuPont that is very durable, easy to machine and can handle very high temperatures. Polyimide is also highly insulative and does not contaminate its surroundings (does not outgas). , PTFE PTFE polytetrafluoroethylene. , thick and thin rigid and flexible substrates. These applications could also necessitate ne·ces·si·tate tr.v. ne·ces·si·tat·ed, ne·ces·si·tat·ing, ne·ces·si·tates 1. To make necessary or unavoidable. 2. To require or compel. producing highly controlled and uniform conductors to meet demand for signal integrity in high frequency applications. Medical applications require extreme cleanliness Cleanliness See also Orderliness. Cleverness (See CUNNING.) Berchta unkempt herself, demands cleanliness from others, especially children. [Ger. Folklore: Leach, 137] cat continually “washes” itself. and zero defects "Zero Defects" is a notional quality standard developed by Phil Crosby. Although applicable to any type of enterprise, it has been primarily adopted within industry supply chains wherever large volumes of components are being purchased (common items such as nuts and bolts are good in outgoing material. A Six Sigma Not to be confused with Sigma 6. Six Sigma is a set of practices originally developed by Motorola to systematically improve processes by eliminating defects.[1] A defect is defined as nonconformity of a product or service to its specifications. mentality men·tal·i·ty n. The sum of a person's intellectual capabilities or endowment. may be required to achieve success in the medical area. Many medical applications also require fine circuitry, often on substrate The base layer of a structure such as a chip, multichip module (MCM), printed circuit board or disk platter. Silicon is the most widely used substrate for chips. Fiberglass (FR4) is mostly used for printed circuit boards, and ceramic is used for MCMs. materials that may not be processed by a mainstream PCB shop. A PCB manufacturer must have significant technology know-how know-how n. The knowledge and skill required to do something correctly. See Synonyms at art1. know-how Noun Informal the ability to do something that is difficult or technical and applications knowledge in order to partner with end-users on design and technology development requires To maintain leadership with any of these applications requires efficient cost management. By far the biggest impact on the cost of PCB manufacturing comes from production yield. Thus the highest possible yield is essential for profitability, especially in complex high-value applications where a single production panel can be worth a significant amount of money. QFD For PCBs Now what? The next step might involve methods from Six Sigma methodology, such as Quality Function Deployment (QFD). The following is an example of how QFD can be used by a supplier developing a photoresist product for the Western quickturn/prototype market. This is just one example of how QFD can be applied to determine the key attributes of an offering likely to be valued by customers in the target market. This method could be used for other product offerings in different market spaces. In addition, a thorough QFD analysis is an excellent basis for value selling and value pricing For the strategic management concept, see . In public roads and transport, value pricing or road pricing is the practice of raising funds by charging users directly rather than via taxation. . Customer expectations or needs are translated and correlated cor·re·late v. cor·re·lat·ed, cor·re·lat·ing, cor·re·lates v.tr. 1. To put or bring into causal, complementary, parallel, or reciprocal relation. 2. with attributes of the product/technology offering in the QFD "House of Quality" (HOQ HOQ House of Quality (Quality Function Deployment) ) in TABLE 3. The HOQ can include anything from a few elements of needs and product attributes to a large number for a very detailed analysis and a higher quality output. The customer expectations or needs are defined bv "Voice of the Customer" (VOC (Vertical Online Community) See vertical portal. ) interviews with typical customers and appropriately positioned people in the target segment. The list of customer expectations is meant to support part of the capabilities from the list in Table 2, i.e., the capabilities that European and North American manufacturers require for profitability, but for this exercise focused on the specifics for a quickturn/prototype operation. The customer expectations in the HOQ are ranked in their order of importance and each is assigned as·sign tr.v. as·signed, as·sign·ing, as·signs 1. To set apart for a particular purpose; designate: assigned a day for the inspection. 2. a number, in this case between 1 and 10, with 10 denoting the most important need. The importance is assigned by evaluating the results from VOC interviews, potentially based on the number of times a certain need is mentioned by each customer. The product/technology attributes are listed based on a list of variables that can be influenced by the product development team or marketing design team. The list of customer expectations is correlated with each of the offering attributes by using a scale of low, medium and high correlation. To denote de·note tr.v. de·not·ed, de·not·ing, de·notes 1. To mark; indicate: a frown that denoted increasing impatience. 2. the importance of each of the offering attributes, the L, M and H ratings are each assigned a number. In this case numbers were chosen as follows: 1 (L), 3 (M) and 9 (H) to get a good spread and indication of the most important attributes to include in the offering. The low, medium and high indicators are multiplied mul·ti·ply 1 v. mul·ti·plied, mul·ti·ply·ing, mul·ti·plies v.tr. 1. To increase the amount, number, or degree of. 2. Mathematics To perform multiplication on. by the importance of the specific customer expectation it correlates with, and a sum is calculated for each of the offering attributes. Each attribute has now been assigned a number for importance that becomes the basis for a Pareto Noun 1. Pareto - Italian sociologist and economist whose theories influenced the development of fascism in Italy (1848-1923) Vilfredo Pareto diagram diagram /di·a·gram/ (di´ah-gram) a graphic representation, in simplest form, of an object or concept, made up of lines and lacking pictorial elements. showing how the supplier should focus the offering (FIGURE 1). [FIGURE 1 OMITTED] What has been described here is not by any means a full in-depth in-depth adj. Detailed; thorough: an in-depth study. in-depth Adjective detailed or thorough: an in-depth analysis analysis. The results are not absolute, and each of the steps in this process can be questioned. Also, the interpretation of results leaves some room for discussion. As seen in the Pareto diagram, an element that meets much of the needs in the market for PCB quickturn/prototype is an offering of direct imaging photoresist. The importance of start/stop capability would further indicate that a dry film resist offering would likely be preferred vs. a liquid resist offering. That basically means that it would not be a good idea for photoresist suppliers to diversify diversify To acquire a variety of assets that do not tend to change in value at the same time. To diversify a securities portfolio is to purchase different types of securities in different companies in unrelated industries. into liquid resists, if their aim is to satisfy market needs in Europe and North America. A broad product line must be offered to cover all applications and meet the customer's need for broad capability. One photoresist film that could do it all would naturally be ideal, but such a film is not likely to excel and meet the need for specialized applications, such as high value applications. An emphasis on wide process latitude latitude, angular distance of any point on the surface of the earth north or south of the equator. The equator is latitude 0°, and the North Pole and South Pole are latitudes 90°N and 90°S, respectively. reflects the facts that an overall high yield is desired for lowest cost, and a high degree of flexibility is needed in quickturn operations. In contrast, fast processing speeds See MHz. are not of highest importance (within reason) to this market nor are special long roll packaging or low priced photoresists. Part 2 of this article will focus on methods to capitalize on Cap´i`tal`ize on` v. t. 1. To turn (an opportunity) to one's advantage; to take advantage of (a situation); to profit from; as, to capitalize on an opponent's mistakes s>. the results of this analysis. MATS J. EHLIN is sales and marketing manager for DuPont Printed Circuit Materials (ResearchTriangle Park, NC). He can be reached at Mats.J.Ehlin@usa.dupont.com.
TABLE 1. Key value drivers for profitable PCB
production in Europe and the Americas
Time critical, quickturn and prototyping
Military/defense applications
Medical electronics
High product mix; short runs
Local production (not targeted by Asian players)
Design involvement/contact-intensive applications
Applications with advanced intellectual property
TABLE 2. List of key capabilities needed for CPB
manufacturers to successfully target profitable PCB
production in Europe and the Americas
Production flexibility
Broad capability
Short set up times
Clean processing
Zero defects (high yield/reliable testing capability)
High resolution capability
Capability to process thin materials
Technology know-how
High yield
Trusted brand
Strong personal relationships
Lowest cost
High plant utilization
TABLE 3. The QFD "House of Quality" used for developing a photoresist
for quickturn/prototype operations
ATTRIBUTES OF OFFERING
Direct Wide Broad
Impor- imaging process range of
CUSTOMER EXPECTATIONS tance films latitude products
Lowest cost 10 L M L
Production flexibility 10 H L H
Short set up times 10 H L L
Multi-material capability 8 M M H
Broad capability 7 L M H
Zero defects 5 M H L
Cleanliness 5 L M L
High resolution 5 L H L
.d -Tight tolerances 5 H H L
High yield 3 M H L
High productivity 1 M L L
No downtime 1 M M L
RESULTS
Lowest cost 10 10 30 10
Production flexibility 10 90 10 90
Short set up times 10 90 10 10
Multi-material capability 8 24 24 72
Broad capability 7 7 21 63
Zero defects 5 15 45 5
Cleanliness 5 5 15 5
High resolution 5 5 45 5
Tight tolerances 5 45 45 5
High yield 3 9 27 3
High productivity 1 3 1 1
No downtime 1 3 3 1
Total 306 276 270
ATTRIBUTES OF OFFERING
Start/
Uniform stop High
line capa- High reso-
CUSTOMER EXPECTATIONS width bility yield lution
Lowest cost L L H L
Production flexibility L H L L
Short set up times L H L M
Multi-material capability L L L L
Broad capability H L L H
Zero defects H L H M
Cleanliness M L M M
High resolution H L L H
.d -Tight tolerances H L L L
High yield M L H M
High productivity L L M L
No downtime L H L L
Lowest cost 10 10 90 10
Production flexibility 10 90 10 10
Short set up times 10 90 10 30
Multi-material capability 8 8 8 8
Broad capability 63 7 7 63
Zero defects 45 5 45 15
Cleanliness 15 5 15 15
High resolution 45 5 5 45
Tight tolerances 45 5 5 5
High yield 9 3 27 9
High productivity 1 1 3 1
No downtime 1 9 1 1
Total 262 238 226 212
ATTRIBUTES OF OFFERING
Clean, Excel- Fast
Resist no lent pro-
flexi- sludge confir- cessing
CUSTOMER EXPECTATIONS bility process mation speed
Lowest cost L M L M
Production flexibility L L L M
Short set up times M L L L
Multi-material capability H L M L
Broad capability M L M L
Zero defects M H M L
Cleanliness L H L L
High resolution L L L L
Tight tolerances L L H L
High yield H M H L
High productivity L L M H
No downtime L H L L
Lowest cost 10 30 10 30
Production flexibility 10 10 10 30
Short set up times 30 10 10 10
Multi-material capability 72 8 24 8
Broad capability 21 7 21 7
Zero defects 15 45 15 5
Cleanliness 5 45 5 5
High resolution 5 5 5 5
Tight tolerances 5 5 45 5
High yield 27 9 27 3
High productivity 1 1 3 9
No downtime 1 9 1 1
Total 202 184 176 118
ATTRIBUTES OF OFFERING
Inex-
Long pensive
CUSTOMER EXPECTATIONS rolls resists Total
Lowest cost M M 280
Production flexibility L L 380
Short set up times L L 320
Multi-material capability L L 272
Broad capability L L 294
Zero defects L L 260
Cleanliness L L 140
High resolution L L 180
Tight tolerances L L 220
High yield L L 156
High productivity H L 34
No downtime H L 40
Lowest cost 30 30 280
Production flexibility 10 10 380
Short set up times 10 10 320
Multi-material capability 8 8 272
Broad capability 7 7 294
Zero defects 5 5 260
Cleanliness 5 5 140
High resolution 5 5 180
Tight tolerances 5 5 220
High yield 3 3 156
High productivity 9 1 34
No downtime 9 1 40
Total 106 90 2666
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