This is the second in a 3-part mini-series of looking ahead to the new decade in the wiring harness industry and the systems interconnect design business. The first part was about technology initiative and this part focuses on business concepts which I believe will be important.
These are my own opinions. Not snap decisions but as arrived at with some contemplation and a little research. They may be right or they may be wrong. The point is to provide an example of how you might think about your how your own business will flourish in the next ten years.
What will it take to be ahead of the pack of of your competitors in the next 10 years?
Winners will have a business vision and realization (mission, strategy and tactics) and flattened business processes. The best will allow creativity, innovation in the context of common ways of working. There’s no difference here from the last decade. Lean, focused companies with well motivated and talented staff prevail over companies that don’t have these advantages.
As I have opined in previous posts I think recognizing how data is habitually interchanged and not how it should be interchanged is a significant issue to be worked out. Data storage, handling and description ideas are materializing and even get presented to consumers as purchasable products all the time. From 2010 to 2020 will not be any different. Will the CHS X2ML format or the AP212 KBL or standard or some other be dominant in five years? Well, I’m not such a good soothsayer that I pretend to know. My prediction here is restricted to what I think is going to be the mix of carrier formats for defining electrical interconnect systems designs and harness bills of material in 2020:
Paper (.pdf and tiff and word processing outputs) and manual re-entry of data ~40%
Spreadsheets and text files; comma separated (csv), position significant other delimited formats like .dsi ~35%
xml based formats ~15%
Direct system to system application automated interconnection - for example like CHS bridging “connected” using Simple Object Access Protocol (SOAP) or other data transfer technology ~10%
I sense big opportunity for early adopters . Hopefully I’m wrong about this - I hope I am wrong about the poor up-take of better ways to have systems talk to each other and organizations start to acknowledge the effort and time they are needlessly expending and address the shortfall in efficiency. Step one is to acknowledge the problem and not deny it. Step 2 is to recognize that the line of least resistance for interchange of data is not the ideal it is the expedient path. Step 3 is to invest in data integration which truly adds value for your customers – good quality comes from good custodianship of it.
Who can argue against wanting the right workflow and paradigms - a predictable way of working with a set of known outcomes. Everyone loves stability – accountants and managers especially. Only investors to keep happy after you succeed with that.
“Compliance” is a popular buzzword in business publications lately. In designing and manufacturing electrical systems for transportation there is a renewed interest in how requirements are translated into physical features. Are requirements met barely adequately or totally and faithfully? When the process of developing a quality product is reproducible, there is substantial value. Tasks, responsibilities and patterns of accountability are controlled to eliminate risk and expense. Let’s just elaborate a little on why this is going to be important over the next ten years.
Legislation for a cleaner environment.
Focus on safety and reduction of warranty claims – trace and audit concerns.
Driving down the cost of field servicing of equipment.
Facilitating recycling at end of equipment life.
International shipping and customs
The price of competitiveness is eternal compliance.
Applications software will intervene into this need to establish and support a good workflow. You will get some help from software to repeat the good practice and eliminate the not so good. And it will help a lot.
In the next ten years you aspire to have a settled engineering process which commonizes as far as possible the way you work with different engineering projects, different clients and variations in hand-offs – the deliverables. Your prosperity rests a lot on how far you get to achieving this. If you get there helped by your investment in design to manufacturing software that will be a job well done. If your software supplier does not help you then you will be doing it independently anyway. “Compliance” does seem a little bit to consist of a re-packaging and marketing re-spin of some of the functions available in expert systems and work flow management software suites of the past. Whatever you want to call it – without validation and audit and proper obedience to regulatory strictures taking place efficiently your company is wasting money and taking on unacceptable risk. This will be the decade where you find smart and optimally automated ways to fulfill your responsibilities and you have competitive advantage over rivals if you do this first.
Finally there is a threat to the primacy of the large-scale factory as the place for fabrication of wiring harnesses. “Fabless” companies making printed circuit boards will be the model for upstart organizations who contract out the electrical interconnect systems to small-scale piece-work operations, then on to larger independent assembling and integration shops. The division of labor principle means that specializing in engineering services, logistics and shipping, inventory management and devolving the fabrication of the finished product not just to wholly owned subsidiary companies in low labor cost areas but shedding that direct responsibility to an indirect relationship is almost inevitable. Business relationships are maturing and morphing all the time between European and American and Japanese companies and partners in South America, Asia, Africa and especially China. The combination at the end of the decade just gone of passenger car sales volumes plunging in the European Union and Chinese new car sales overtaking those in the USA are indicating trends which will result in new ways of thinking and creative approaches to making volume harnesses.
The know-how of China, Thailand and Brazil will be feeding into the way Detroit, Paris and Wolfsburg does business tomorrow. There will be a challenging time for the multi-nationals who have dominated automotive harness supply since the 1990’s. A production manager in Juarez today is likely to be the CTO of a location-less harness maker in five years. Sought-after skills in the industry will also include legal expertise in negotiating and drafting contracts in the Philipines one month, Latvia the next. Engineers are still the going to the engine of prosperity to such companies, experts in logistics will be the turbochargers.
CHS the high octane fuel.