Reading time ( words)
Merriam-Webster’s online dictionary defines the word “profit” this way:
1. A valuable return: Gain.
2. The excess of returns over expenditure in a transaction or series of transactions, especially: The excess of the selling price of goods over their cost.
It’s easy to define profit, but it’s much more difficult to define exactly what “design for profitability” (DFP) means to today’s PCB designers and design engineers. How can technologists create profit in every design when the board’s stakeholders are often spread out across several time zones and continents? It’s a tough concept to get your arms around. Some of you work in giant OEMs; do you have any idea how much your last design cost—man-hours, components, laminates, etc.?
When I started working on this issue, I was happy to hear that many designers were already familiar with DFP. When I first mentioned DFP to designers years ago, they’d look at me like I had two heads. After all, designers used to feel as if they were the lowest person on the totem pole, and many didn’t realize the power that they wield over the profit of the PCB and, potentially, the final product. Fortunately, that has changed, for the most part.
In a recent Design007 Magazine survey, about two-thirds of respondents said that cost is a definite factor in their design process. Apparently, most CAD managers are well aware of the designers’ power to massage costs; some engineering managers believe that up to 80% of the board’s cost can be determined during the design cycle. Some designers are also being tasked with making cost-aware design decisions each day. Designers—already forced into thinking like degreed engineers, often making system-level decisions—must now think like accountants as well.
To read this entire column, which appeared in the March 2020 issue of Design007 Magazine, click here.