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Factors to Consider Before Global Outsourcing
Potential for problems starts at product design.
Picking up a product designed in
U.S.
and dropping it into
China is very difficult
. Substitute parts could take time to find and receive. The
inevitable Engineering Change Order (
ECO)
could cause further delay due to communication complexity along with cost of
additional
man hours and travel time.
Work schedules between U.S. and Asia
typically don't coincide.
Many time zones are involved within a 7000 mile spread and it's difficult
to compensate for the differences in time.
Don't assume quality is bad
but keep in mind that a single problem can create a costly domino effect
impacting delivery and materials management – resulting in minimal
cost savings.
Utilizing substandard counterfeit parts
is a
real issue
sometimes leading to low quality and product failure. Best way to avoid
counterfeit products is to buy only from authorized distributors or
directly from a reliable manufacturer. Protection of intellectual property is an
additional concern. Deal only with highly reputable companies.
RoHS compliance of components
becomes more difficult to detect without expensive lab tests and can
put you in legal jeopardy. You must trust the word of your component source as
much of the move to lead-free products is based on trust. Recently publicized events,
in areas of food, pet food and toys, illustrate lack of effective overseas
controls.
Considerations about what products to manufacture offshore?
-
What part of lifecycle?
Is it a new product that may require engineering changes or mature product with
minimal engineering changes?
-
Sh
ould product be re-engineered
for needs of manufacturing location? Manual work? Local availability of
materials?
-
Is demand variable
with spikes or stable predictable demand? How critical is lead-time for delivery
– can you tolerate long delivery cycle or time critical hurdles due to
transportation.
-
Would around the corner support be beneficial
vs. 7000 miles away?
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