Keeping Manufacturing Onshore By Design
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DFMA software helped QSI Corporation (now Beijer Electronics, Inc.) reduce costs while designing mobile data terminals domestically
As more and more U.S. manufacturers are learning, chasing low-cost overseas labor as a competitive strategy isn't always the answer. As distance from the home office and domestic markets increases, so do hidden costs: lower quality, extended lead times, shipping difficulties, larger inventories, and layers of communication obstacles. Factoring these into the bottom line can be a convincing reason to keep production at home.
But staying domestic doesn't make challenges disappear. Customers are demanding higher-performance products with more features and complexity--smaller, lighter, better and, of course, cheaper. So manufacturers wary of offshoring are looking for alternative, cost-efficient strategies that can be applied locally to keep both customers and accountants happy.
The company formerly known as QSI Corporation (www.qsicorp.com), a manufacturer of rugged mobile data terminals and human machine interfaces, never looked farther than its Salt Lake City, Utah base for success. Founded in 1983 and acquired by Malmo, Sweden-based Beijer Electronics last October, QSI is now known as Beijer Electronics, Inc., the North American subsidiary of Beijer Electronics. The company will continue to offer the QSI line of rugged terminals in the industrial and vehicle markets, along with Beijer Electronics' hardware and software. But in its key vehicle and industrial markets, Beijer is facing the same pressures as everyone else. The company is pitted against manufacturers who have offshored their operations, as well as foreign companies that are using price as their key "entry" strategy into the U.S.
There's no place like home
The mobile data terminal industry is growing at a significant rate, due in large part to the wealth of available information and our ability to access it from almost anywhere on earth in real time. Beijer Electronics, Inc., is strong in two major sectors: vehicle markets, which include 18-wheelers, long-haul trucks, buses, shuttle-cabs, and commercial fleets; and industrial applications, where customers can be found in widely diverse industries such as oil and gas, food processing, marine, or virtually any setting in which businesses can benefit from a conversation with a machine.
Using QSI terminals and partner software, for example, a long-haul trucker can access best-route information in seconds, a food processing operator can control assembly line automation and robotics from the factory floor, a medical technician can access critical patient data, or an oil-field trucker can manage the pumping of slurry into a well to create optimum pressure. The environments in which terminals are used can range from benign to the most dirty industrial settings and from underwater to bone-chilling cold or desert-like heat.
So while data terminals are in essence powerful, application-specific computers, they need to be packaged for punishment. That's where Beijer Electronics, Inc., excels. They also excel because their onshore design and manufacturing strategy has provided numerous advantages.
"Our design, testing, and final assembly are all done here," said Bill Devenish, formerly director of engineering at QSI Corporation. "When a customer calls with a question, they get an immediate answer; no time delays. Many of our competitors, who have gone to Asia to get their products manufactured, have run into problems. We've been very conscious about keeping that activity close to home."
By keeping design and manufacturing domestic and co-located, QSI was able to maintain total control of its products: That includes ensuring that intellectual property is secure, developing deep manufacturing and process knowledge, nurturing the supply chain, holding inventory levels low, and shortening product cycle times.
But to compete, Devenish and his engineering team had to be attentive to the always-important cost dimension to entice new customers and keep existing customers coming back.
DFMA unlocks lower costs in two products
Early in 2009, QSI was approached by a long-term customer to see if they could reduce costs 50 percent on a custom-designed interface terminal. At stake was a significant amount of business in a period of tremendous economic turmoil. Devenish, new to the company at the time, had previously used Design for Manufacture and Assembly (DFMA) software from Boothroyd Dewhurst (www.dfma.com), of Wakefield, Rhode Island. The results had been impressive, so he decided to adopt it at QSI.
In general, DFMA analyzes best manufacturing and assembly strategies early in the product design process, making products lean from the start. The Design for Manufacture (DFM) tool compares and calculates the costs of different materials and manufacturing methods. The Design for Assembly (DFA) software is used to eliminate parts and tooling, cutting associated costs.
Using DFMA to redesign the custom unit, the team first reduced PCB assemblies, which decreased fasteners. They also incorporated lug and tab features to replace screws, carefully considered material thicknesses to eliminate the need for washers and nuts, and made geometry changes to simplify fastener choices. In addition, to avoid unnecessary reorientations during assembly, they designed for a top-down assembly. Five design iterations later, Devenish's group had reduced parts 50 percent, fasteners 61 percent, and assembly time 70 percent, meeting the customer's high initial expectations.
With one DFMA-design success under their belt, the engineering group turned to the software again when beginning design on the company's new Human Machine Interface (HMI) product line. These units needed a host of new features, and had an ambitious cost-target. "It was very aggressive," said Devenish, "but we knew we could do it using a combination of DFMA and clever product architecture."
Using the original HMI terminal as a baseline, the team set to work to simplify the design and resolve any inherent design and assembly limitations. Specific solutions included a lug-slot fastening method for the back cover, a bracket to hold vertically stacked PCBs, and a speaker held in place by a bayonet clamp--all of which eliminated assembly hassles. In addition, the team chose a plastic cage to hold the LCD display in place, which eliminated adhesive and tolerance issues, making assembly and alignment easier. At final count, fasteners were reduced 43 percent, parts 44 percent, and assembly time was cut in half.
With the first pre-production units coming off the product line, Devenish felt confident that they would reach their initial goal of cutting costs by a third. "Our newer products are very streamlined as a result of using DFMA software and techniques," said Devenish.
A new design and manufacturing mindset
By employing DFMA systematically, price took care of itself for Devenish and his team. These cost savings, along with enhanced features, can be passed on to customers, allowing QSI--and now, Beijer--to remain competitive without an impact on company profits.
As sales grow, there are further competitive advantages to using DFMA. "When the volume is low, it's easier to justify higher labor costs and product complexity," said Devenish. "But as volumes increase and the product becomes commoditized, the customer expects costs to drop." DFMA enabled that changing economy of scale. "When we can cut our assembly time in half," Devenish added, "we can double our sales volume without expanding our facility."
Ruggedness and customization, two other key dimensions of QSI's market strategy, also benefited. The company's new HMIs (with a reduced-fastener design), for example, are said to have been virtually unbreakable in a series of vibration halt tests that meet the industry's most stringent requirements. And with much of what they sell varying from standard off-the-shelf designs, DFMA has helped guide design efforts toward modularity and its obvious benefits.
According to Devenish, the company changed its product design approach using DFMA. "Now the mindset is to spend more time upfront in design to save assembly time and prevent errors later on," he said. Matt Parkin, an engineer on the team, added, "Now that we've caught the vision, we put more thought into reducing components and combining functions. It's become almost a game to reduce parts and make assembly easier."
As QSI's engineering team challenged itself to create more efficient DFMA-inspired designs, the company's broader strategy of keeping operations in the U.S. remained secure. As for future product development, said Devenish, "It would be very hard for someone to get a project past me if they're not doing DFMA."
--Edited by D2P.
DFMA and the Mobile Phone Mentality
Since it was first described more than 40 years ago, Moore's Law has succinctly and successfully predicted the exponential growth of computing power. Every two years, the number of transistors that can affordably be placed on an integrated circuit has doubled.
Digital electronic devices of all kinds are essentially tied to the same simple principle. That's because cell phones, PDAs, MP3s, GPS units, and digital cameras are nothing more than tiny computers, with ever-increasing memory and processing speed. The mobile phone, for example, has evolved from a two-and-a-half pound novelty, costing $3,500 when first introduced by Motorola in 1973, to a pocket-sized device that weighs only ounces and costs just tens of dollars.
This example, along with many others, has come to shape consumer and customer expectations about the capabilities and cost of digital electronic devices. At the same time, the mobile phone mentality of better, smaller, and cheaper puts pressure on a host of manufacturers and their products. Mobile data terminals, such as those produced by QSI Corp. (now Beijer Electronics, Inc.) are no exception.
While many argue about how long Moore's Law will hold up, Design for Manufacture and Assembly (DFMA) software from Boothroyd Dewhurst is well-positioned to play a role in satisfying customer demands stemming from this way of thinking about product evolution. That's because DFMA helps engineering teams look for systematic ways to simplify designs by consolidating and cutting part counts, minimizing assembly time, and reducing costs.
QSI Corporation, along with a wide variety of other manufacturers--from large aerospace companies to makers of industrial components such as innovative latches--have enjoyed DFMA's consistent and dramatic results: cutting parts by an average of 54 percent and overall cost by 50 percent. The results for digital device makers, such as QSI, are feature-rich products, in a smaller package, at lower cost--delivering on the promise of "better, smaller, and cheaper."
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