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Improve margins by training cost-aware design engineers

Posted: 17 Nov 2014 ?? ?Print Version ?Bookmark and Share

Keywords:design engineer? PCB? manufacturing cost?

Among a lot of things, engineers know how to make things done. What they are lacking, sadly, is the ability to be economical. It may come as a surprise that design engineers hardly consider the manufacturing costs of the circuit boards they design for industrial, commercial and even medical products.

In many cases, that's because the boards are for new generations of existing products, so the project manager likely expects the electronics to cost "about the same" as before. In other cases, the cost of the electronics may be small compared to the overall cost of the product and so the topic doesn't get a lot of scrutiny.

When the design goes to production, buyers will try to reduce costs by negotiating prices of components and assemblies. In truth, there is very little the buyer can do at that stage. When designers don't know or care about manufacturing costs, they will make some costly decisions that buyers can't overcome.

For example, many designers don't realise that double-sided SMT boards essentially double the manufacturing process. The board has to go through stenciling, pick-and-place or insertion, soldering and inspection for one side, and then the entire process has to be repeated for the second side.

Double-sided boards are fine when necessary. But often, spending a little more time on the design and layout can eliminate the need for the second side.

In contract manufacturing, we have actually been asked to build assemblies that have just five per cent of the components on the second side. There is no reason these could not be single-sided boards. The board designer took the easy way out, saving a few hours in the design, probably completely unaware of the added costs over the lifetime of the product.

We also see board designs with expensive components specified when the exact same parts are available from another vendor at half the cost. It takes very little time to look at a couple of sources for parts. However, designers need to be educated that price should be a factor in component selection.

Engineers should be required to specify multiple equivalent parts whenever possible. This not only allows buyers to shop for the best prices, but also safeguards against component obsolescence.

In our design services group, we get RFQs that provide detailed performance specs and ask us to quote time and cost to produce a design that meets the specs. Only once has there been any mention of manufacturing cost targets (for a consumer product). Our customers are surprised when we point this out. Many of them assume that all designers will design for lowest cost, but that's not the case.

When engineers join Z-AXIS from manufacturing companies and design houses, they have had to learn new skills to work in our environment where manufacturing cost also matters in the design.

For example, one new engineer, on the first simple schematic, added 30 new part numbers to our system. Switching to equivalent parts already in our system took a few extra hours but cut overhead costs substantially. Now it's routine for our engineers to shop for parts that are in our system first, and specify new parts only as needed.

Even if the electronics make up only 10 per cent of the product cost, if you can cut the manufacturing cost in half by using a single-sided board and careful component selection, that's an extra five per cent to either improve your margins or price your product more competitively.

You can create an environment where PCB assembly costs matter to design engineers as well as to buyers. For starters make sure that new engineers have exposure to the manufacturing processes your company uses for your boards. It can be a real eye-opener for many. Also, encourage design of single-side boards.

Require engineers to specify one or two alternatives for each part where possible, and make it easy for them to check for and select components that are already in your system.

- Michael Allen

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