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Sola Notes Customer-centric Model Key to Survival
December 31, 1969 |Estimated reading time: 2 minutes
By Michelle M. Boisvert
Listening to your customer was just one of the strategies that keynote speaker Jure Sola, CEO and chairman of the board at Sanmina-SCI, shared with attendees on Wednesday, February 8. Sola noted that the customer-focused strategy is one way to compete in the global world of electronics manufacturing. Sola co-founded Sanmina in 1980 when, he states, no one really knew what an EMS firm was. Despite this, the company grew steadily from 1983 to 2000.
Once the downturn of 2001 occurred, however, Sanmina looked to restructuring. "We decided we couldn't be a niche player anymore" claimed Sola. "We had to take our Asian competitors head-on." Sanmina then merged with SCI at what may have seemed like the worst possible time. But SCI offered the global presence Sanmina needed to compete, added Sola.
Within the down market, Sanmina-SCI management began looking at the world differently. "No matter how large or small your company is, listen to your customers. Understand what the customer wants," noted Sola. In addition to being in tune with the customer, Sola advised that companies must remain flexible and able to adjust to what the customers need to compete. Having facilities within close proximity of the customer also is key. Companies should offer a global solution with a strong IT infrastructure that keeps remote locations connected. Sanmina uses a build-to-order/configure-to-order (BTO/CTO) model that facilitates these global operations.
Sola also noted that the EMS platform is changing. It's no longer a simple manufacturing structure, but instead combines EMS with ODMs. This has the company focusing on leading-edge technologies that allows customer partnerships. These partnerships encourage companies to design together to speed time to market, contributing to another point of success for competitive companies -- speed.
There are some challenges within the market that must be addressed, warned Sola. The industry must begin making higher margins. "The industry has been generating a lot of cash, but nobody is getting rich," said Sola. The market must make more money than it is now, or it's not going to survive. Sola suggests companies engage in more collaboration with new technologies to become more profitable. Companies need to show this profit in the next few years, he added, or the industry is going to start seeing some "tough times."
When questioned about prospects for the market in India, Sola commented that there was promise in the region, but not immediately. Unlike China, he added, India lacks the infrastructure for sudden growth. However, the area likely will become a profitable manufacturing region within the next few years.