EMS@C-LEVEL
As Forbes, Entrepreneur, Fast Company and SCOOP writer, Philip Stoten, continues to talk to EMS (Electronic Manufacturing Services) executives he learns more about their individual and collective experiences and their expectations for their own businesses and for the entire electronic manufacturing industry.
EMS@C-LEVEL
Navigating the Complexities of EMS Leadership and Growth with Amtech CEO Jay Patel
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Explore the ever-evolving EMS industry with Jay Patel, CEO of Amtech, filmed on location at APEX24. This episode delivers a deep dive into high mix, low volume manufacturing, where Jay describes the strategies ensuring Amtech's robust customer loyalty and their approach to design collaboration, DFM, and supply chain. We also explore reshoring and how global geopolitics are reshaping the manufacturing landscape.
Share Jay's foresight of a leader as he shares his invaluable perspective on the importance of corporate culture that sits at the core of Amtech. Jay and I go onto to dig into the realities of talent acquisition, automation, and their vital roles in steering a company forward. We also take a look toward the economic horizon of 2024, considering the agility and innovative spirit businesses must embrace to thrive amidst the disruptions of trade wars, pandemics and supply chain challenges. Jay underscores the importance of C-level networking, including at events organized by IPC, where sharing ambitions, challenges and industry predictions becomes a key part of strategic foresight.
EMS@C-Level is hosted by global inspection leaders Koh Young (https://www.kohyoung.com) and Global Electronics Association (https://www.electronics.org)
You can see video versions of all of the EMS@C-Level pods on our YouTube playlist.
Hello, I'm Philip Stoughton. I'm at Apex 2024 on the Coyoung booth and I'm joined by Jay Patel from Amtech. Jay, thanks for joining me. Let's start, for those that don't know Amtech, with a brief introduction to the business.
Speaker 2Yeah, we're a second generation family owned EMS based out of Detroit, michigan. You know we're high mix, low volume, but we try to implement some unique capabilities that really set us apart. Okay.
Speaker 1And most of your customer base in that Detroit area or we're at this point.
Speaker 2We're a regional CM but you know, we hope to become larger and increase the size of our region.
Speaker 1Yeah, and obviously that's known as Motor City. Is automotive a big part of your mix, or is it other sectors?
Speaker 2At this point we mostly focus on commercial industrial. We're trying to break into more and more automotive, but a lot of the tier ones and everybody they have their own captive SMT. So we have to get the right sweet spot that makes sense for them to outsource it to an EMS like us. Yeah.
Speaker 1Yeah, and those customers, that you have, those loyal customers. What do you think it is about Amtech that brings those customers in, that makes them loyal? What are they looking for?
Speaker 2I think our level of engagement and service is there.
Speaker 2We try not to be just an electronics manufacturing company.
Speaker 2We try to engage with them at a higher level. So when it's their design, when they start with a design or product development, we try to engage with them for DFM, give them supply chain feedback, even work on their product roadmap what technologies are coming, you know, down the pipe and then help them design things in so they become future-proof. So not only do we stay on the manufacturing side, but we try to go up through the entire design lifecycle and engage at that point so we can reduce the risk of the entire assembly design cost out of it and design quality into it. So the customer gets a product that they build whose quality is good both on the manufacturing side and in the field, and then also the product can be active for a longer period. And then if customers come to us where they're mid-life cycle, we can actually take a look at it and do an analysis and re-engineer the product with up-to-date and current components and then kind of increase the life of that product so they get more revenue out of the investment they made.
Speaker 1Yeah, and I think that's key to the success of an EMS is driving value, and the earlier you can get involved in the product engagement, the more value you can drive for those customers. When we look at the kind of megatrends that have been going on in the product engagement, the more value you can drive for those customers. When we look at the kind of mega trends that have been going on in the industry two or three things going on Geopolitics seems to be either driving people to reshore to the US or maybe not offshore as early in a product volume as they would. Do you see that trend impacting your customers?
Speaker 2I think the sentiment is definitely there to reshore, but there's also you know, we're in business there has to be a valid business case. I think one thing that we're seeing is that we need to figure out, if we are going to reshore, how can we do that, leveraging new technologies and new process capabilities? And if we could bring the price down and be competitive to a point where they can absorb the price difference, we can do that. And then, if we're not able to do that, we have to be creative in developing new supply chain and other low-cost countries, just as everybody else is, and be active in that and get our footprint in those areas as well.
Speaker 1Yeah, so do you partner with overseas manufacturers? Do you have a kind of a next route for customers that are getting to a volume point where they need to be, or they feel they need to be, overseas?
Speaker 2Yeah, so we do have a network and we do leverage that network when we need to.
Speaker 1Yeah that makes sense, doesn't it? And then you know you can take care of it. You've got the design process down pat so you can deliver that package and make the MPI simple for the next person. That makes a lot of sense. One of the issues we're hearing about in the US a lot at the moment is talent shortages. How challenging are you finding it to get the talent you need and to retain that talent?
Changes in Talent Acquisition and Automation
Speaker 2I think it's extremely, extremely difficult right now and really you know we're talking about talent shortages, but if you talk to anybody in leadership or management, people have been the number one issue. Nobody's ever said, hey, this is a great market, the people are so cooperative, we're going to be able to scale our business. Nobody said that in the history of the modern economy it never has happened. I think right now we can't apply the rules that were used five years ago or a decade ago to the workforce that is out there right now and we're working a lot with that. I think IPC's done a great job of informing us on how to attract that talent. They work with the local community, develop apprenticeship programs to attract that talent.
Speaker 2But really I think it's a sense of leadership to be able to recognize what's going on and then pivot Now, are you going to get the large pool that you used to? Maybe, maybe not, but then that is up to us to be able to present ourselves and attract that type of talent Before it may have been. Do we have, do I have enough capital to invest in an SMT line or equipment? Now we have to say do I have enough capital to invest in the culture of the organization to attract that talent Really leadership's role and outlook on talent acquisition. Corporate culture is going to have to change, yeah and does diversity play a role in that?
Speaker 1Is it attracting a more diverse workforce? Is it thinking about maybe older people, maybe less able people? What can increase your talent?
Speaker 2So I think we had our EMS summit here and this was one of the major things we talked about and there were a lot of good things that came out of it, of different avenues, alternative avenues to be able to work and engage different employees, and I think we're all experimenting with it. But I think if we think different and kind of think out of the box, there may be some untapped opportunities to get talent. And one thing that they everybody focused on and reiterated and all the successful companies said is skills can be taught, but culture and attitude is what we need to be looking for right now. Yeah, culture always wins.
Speaker 1That's absolutely true. One of the areas that people are considering when they look at talent shortages is using automation to maybe mitigate some of those talent shortages, actually make some of the jobs more interesting, but allow them to maybe manage more machines, more lines, whatever, using automation. Do you see that as part of the mix of solutions, and are you investing in automation as part of the talent issue but also to become more competitive with perhaps international manufacturers?
Speaker 2Yes, I don't know how competitive I will be able to be with international manufacturers. There's a whole slew of stuff that them their price point, where they're at, and I don't, frankly, understand all of it. But I do feel, like you know, there may have been old in the old world, where you think twice, three times, 10 times about, you know, scaling your business. And I think right now people think less, if there is, if there's a point where we need to hire or automate, I think people are going to lean towards automation and that's because to create quality product it's almost a miracle from the designs to going in. Yeah, it's that simple.
Speaker 2And I think there's a lot of stress if you don't automate it. There's a lot of stress and there's a lot on management and the operator to do the job the right way the first time. And we're all human and I think I think if we can make and provide tools to the employees and the team members to to make their job easier, it's a win win for everybody. You know, like if I'm a technician, I don't want to be worried all the time that I'm going to make a mistake. If I can automate that and then that technician is able to tend that automation. That's one less thing that they're worried about, one less conflict that they're having, and makes their job more enjoyable. So automation to mitigate labor shortages is there, but also, I think, automation to make everybody's job easier and more effective.
Speaker 1So we can work on, I think, automation to make everybody's job easier and more effective so we can work on improving the business. Is there as well? Yeah, and it's part of that whole drive for operational excellence and operational efficiency which everybody's focused on now. Last question it's an election year here in the US. The economy has been interesting, shall we say, for the last six to 12 months. What do you see for 2024 in terms of growth potential?
Speaker 2I think, you know, for us for lack of better words we want to be the masters of our destiny.
Speaker 2There's always going to be ups and downs Like who would have even thought about COVID and then the semiconductor shortage but we had to find a way and we had to control our own destiny, and I think for us, you know, do other economic policies make business easier?
Speaker 2Yes, but does that give us an excuse not to grow our business? No, and I feel like, you know, if it makes it easier, great, but if not, you know you still got to do it. You know, we're all hungry, we get hungry. We all have to, you know, support ourselves and support our families, support our loved ones, and I think we just have to find a way. And the companies that are innovative enough, agile enough to be able to see what's going on and react to it properly, are the ones that will survive, and hopefully, amtech is one of them, and we've done a lot of things to bring in a lot of different voices, built our leadership team up to be able to give us the competitive advantage whether it's in the industry or just in how to operate businesses to be able to react to those type of situations that come up.
Speaker 1Yeah, and you're absolutely right about the importance of agility and we learned that during COVID. But we've seen disruption after disruption from trade wars through COVID, through supply chain issues, and you have to be that agile business that is strong enough and robust enough and kind of gets ahead of this stuff.
Value of CEO Networking
Speaker 2Disruption is the new norm. I mean, if it's not this? Like you know, I remember when there was chip capacitor shortages, then tantalum shortages, and then semiconductor, then COVID, like it's never been a smooth, it's not a free ride, no, it's never been a smooth road and I think we just need to be able to be reactive. And that's why, for us, coming to things like IPC, getting involved with the EMS steering committee and all those types of things, they really help us understand what's going on in the industry and make the proactive decision to anticipate what's happening, rather than being always in reactive mode.
Speaker 1Yeah, you can't underestimate the value of networking, particularly at the CEO level, because it's important to have someone to discuss ideas with. And to blue sky, where the industry is going next. Jay, it's a pleasure to chat to you. Thanks so much, all the best with the business this year and thanks for talking to me. Thank you so much. All the best with the business this year and thanks for talking to me. Thank you very much.