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Design Chain Challenges and Opportunities in 2011

Consumers can stop fantasizing about convergence. We all are experiencing it and know what it feels like. If you’ve used a smartphone, kindle, or tablet computer of any sorts lately, you truly understand the experience is enlightening but how does this innovation affect the overall electronics design and supply chain and what kind of challenges have resulted from convergence?

Here are the defining characteristics of the world we've stepped into:

  1. In 2011, according to Vision Mobile, smartphone shipments will exceed 150 million units or roughly 24 percent of all mobile phone devices worldwide
  2. Increasingly, software and embedded operating systems (OS) for these devices (e.g. Android, Apple iOS, etc.) are being branded and have become the differentiator in choosing a mobile device.
  3. Design trends in the communications' market now tend to be about intellectual property and are less silicon supplier dependent, allowing for increased competition, speed to market and more platform portability.
  4. Fabless semiconductor companies are fueling growth in silicon innovations. A good example is Cortina Systems, one of a group of hot new semi suppliers in the communications industry. Based on winning IP and fueled by hundreds of patents — some gotten from {complink 2657|Intel Corp.} — they are winning new designs at large OEMs and becoming increasingly important to those customers despite being a relatively new player vs. established suppliers.

Supply chain challenges are now more complex than ever given global demand, offshore sourcing, new supplier onboarding and legacy product support. Couple this with product obsolescence, counterfeiting issues and a reduction in suppliers or lack of inventory in the pipeline and sourcing executives are bound to come to work on any given day with major concerns on their minds. They can take solace in the fact there are solutions available as time to market and production pick up.

Engineering teams are using more “System level designs”, allowing companies to take modular approaches to solving their product requirements and challenges. This gives people involved in product and supply chain management more leverage and options as they work through their supplier base. Another benefit from board level, SoC (System-on-Chip) or modular designs is international certification and testing from firms like UL or Intertek, which is helping customers get products faster. Standardized hardware with software to differentiate products is smart for many applications.

Another innovation helping legacy designs is the ability now for firms to take old ICs and functions and place them in small inexpensive ASICs. Companies like LinearChip and {complink 3039|Lattice Semiconductor Corp.} are able to take a client’s IP and place it more inexpensively than ever in an FPGA or custom ASIC at costs that outweigh a total system redesign. This is especially good for customers who need to support products in the field for 10 years and more but cannot afford all the costs and inventory carrying issues that last-time buys create.

Lastly, challenging your supply chain base is always an option, including asking them to implement programs for replacing and expanding ICs where necessary. Of course, your current suppliers are the best sources to go to for solutions in the traditional sense. Better lead times, more inventory support, better information sharing, and overall better accountability are the right strategies. Innovation runs rampant today, and you may miss a play by not expanding your support network and giving those upstart suppliers with truly new solutions a chance to shine.

3 comments on “Design Chain Challenges and Opportunities in 2011

  1. tioluwa
    February 22, 2011

    Definitely, the emphasis is on opportnities, not challenges.

    i guess the increased complexity will demand supply chain experts to understand trends specific to various sectors, not just on a general note. the trends in tablets and PC, telecoms and the fabless companies brings up varying factors and stacks, meaning they must be tackled independently of each other.

    However, you  “your current suppliers are the best sources to go to for solutions”

    is this remark to the supply chain practitioners? i ask because all indication shows that the supply chain and suppliers must all adjust to meet the demands of the designers and the market.

  2. Bernard
    February 22, 2011

    T,

    You are correct-this statement is sent from a supply chain management perspective, and is only offerred as the “supplier you know” is teh best place to push for reccomendations and solutions since switching costs are minimal, and relationships are more robust.

    Thanks for weighing in, Cheers…

  3. elctrnx_lyf
    February 22, 2011

    With increase demand for tablets and smartphones the supply chain turns out to be a crucial factor. To design products with the considerations of the components used in is really a challenging task for engineers also. Since most of the component vendors are making their products targeting these two sets of products, finding component for other kind of applications like medical, avionincs is also really challenging…

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