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SMT Solver: Optimizing Your Manufacturing Operations

Optimization of manufacturing operations is a broad subject; in fact, it is broad enough that MBA and PhD degrees are awarded in operations management and multiple books have been written on the subject. Operations management is an amalgamation of technical and business issues. We are not writing a book here but if you take a 50,000-foot view of the subject we should ask: What is the focus of manufacturing operations?

The way I see it, there are only two things: quality and delivery. This is essentially the focus on the factory floor. Why? Because the customer cares about getting a quality product and getting it on time. When you analyze feedback from your customers, what are the main complaints the customers have about their suppliers? It’s the same: quality and delivery. 

To optimize manufacturing operations, you must set up a strong internal manufacturing infrastructure. You need this to deliver high quality products on time, to keep your customers happy, and to run a profitable operation. You cannot do this without the help of your employees and suppliers—two of the major stakeholders in the company besides the owners.    

We often see headlines about the current state of poor infrastructure. While not everyone agrees on the definition of infrastructure, most agree that roads, bridges, airports, water, sewer, internet, and the power grid are part of infrastructure. But for the functioning of a modern society, if you include as part of the infrastructure the well-being of the populace in general—not just a privileged few—and the sustainability of our planet, you will find a variety of opinions. I am not an expert in these political and social areas, but it serves as an example to define infrastructure. 

Similarly, in the electronics industry, there is no disagreement on the basics of manufacturing infrastructure—appropriate buildings, offices, manufacturing spaces, and all the necessary equipment for building your products. However, you need more than the building and the machines. Having the right machines for the job is important but it is not sufficient to achieve high yield on a consistent basis. 

What You Need to Optimize Manufacturing

Machine Characterization
What else do you need besides the equipment? In addition to equipment operating procedures provided by the suppliers, you also need to fully characterize each machine and create an equipment characterization document for each piece of equipment. Since every machine has its own idiosyncrasies, this allows the operator to thoroughly understand all the peculiarities, eccentricities, and quirks of each machine. You know you have fully characterized your machine if you can produce a defect on demand. Of course, you will never do that, but you know you can. Characterizing the machine is about understanding all the equipment-dependent variables and how they impact product quality and output. Very few companies have such documents. In addition to equipment characterization documents, you also need equipment maintenance and calibration procedures to produce a product with consistently high quality. 

Process Recipes
Then there is a process recipe that you need for each process on the manufacturing floor. This is not equipment-dependent documentation. It has nothing to do the machines themselves but with the process performed by those machines. Examples of such documentation would be handling and printing of solder paste, and developing the product-specific profile. We need a document for each step of the manufacturing process, such as storage of moisture-sensitive boards and components, adhesive and paste printing and dispensing, placement of components, soldering, rework, cleaning, inspection, and test. These are company specific, internally developed documents and very few companies have these process documents, as is the case for the equipment characterization document mentioned earlier. 

DFM Documents
Having the process and equipment documentation is not going to be enough. The products being built must be designed correctly. Just because the defects are seen in manufacturing does not mean that the root cause lies in manufacturing. How the product is designed plays a key role. That means having a company specific, internally developed design for manufacturing (DFM) document that includes component selection, design guidelines, and rules. Unfortunately, DFM is another company-specific document that very few companies have.  

Standards and Certifications
There are companies who think that since they are ISO9000 certified, they have all the documentation that they need. If that was true, no one would have quality issues since almost all companies are ISO-certified. Nothing could be further from the truth. The reality is that these days most companies claim to have process recipes since most of them are now ISO-certified. ISO certification is a good thing but very often it is more of a marketing tool and not helpful for building products with high yield. The ISO requirement is, “Say what you do and do what you say.” Most companies do not say much and keep their ISO documents too general with no specific details about the design and process so that they can easily pass and keep their ISO certification when audited by ISO inspectors. You need specific details and not generalities. 

Also, most companies think that since they have IPC standards, that is all they need. No, it’s not. Having chaired a half-dozen IPC documents over the years, IPC standards are trying to solve world hunger. What I mean by that is: IPC standards are general in nature to incorporate requirements for all applications. As a company, you are concerned only about your products and applications, so therefore, you need to have your own requirements. Yes, you can use IPC standards where it meets your requirements.  

In addition, IPC standards are not specifications. Specifications are written by the company that writes the checks. That means you. You need to have custom documents to meet your product requirements based on the market that you serve. You do need IPC standards but use them as a guideline to develop your own customized process and design document. 

Training
Having the right design, good quality incoming materials, and an in-house process document are necessary but not sufficient. Training of personnel at all levels, from senior managers to engineers, operators and purchasing agents is critical for addressing all the issues needed to improve yield. No one gets up in the morning and says, “I am going to screw up three things today.” So, it is management’s responsibility to provide training at all levels. Again, training is one area where you will see a wide variation in different companies. And what do you need to train your personnel? You need the three documents I discussed earlier. The documents are developed by a few engineers in the company. They know what is in those documents. You need to use those documents to develop your training program and spread the knowledge about those documents across all your employees who need to know. 

In addition to leading the SMT team, one of my roles at Intel decades ago was to train engineers (with the help of many of my colleagues). My job was to develop those documents and teach the classes. I did this one every quarter for five years. 

A Case Study
Here is another point worth keeping in mind: Even when a board is designed by the customer and built at different locations of the same company, the quality results can be vastly different. And the quality results are also different when the same board is built by different companies. Let me give you a real-life example. 

I served as a technical expert in a large legal tax case between the IRS and a major U.S. OEM involving a $1 billion tax liability. The case lasted over two years and was finally tried in U.S. tax court; the IRS lost the case. In the case, the OEM designed the board in the U.S. and built it overseas in its own subsidiary. They also built the same board at different EMS companies in the U.S. and paid about the same amount for assembly of those boards to all the suppliers, including their own subsidiary. 

However, the IRS had a problem with the OEM paying the same amount to its own subsidiary as what it had paid to its U.S. suppliers. According to the IRS, the OEM should have been paying less to its own subsidiary since it was in a low-cost country. According to the IRS, the only reason they were paying an excessive amount to their subsidiary was because the OEM wanted to reduce their profit in the U.S. where profit is taxable, while increasing and their profit overseas where there is no tax on profit. 

The IRS had two reasons for their argument: the subsidiary was in a low-cost country, and the board was designed in the U.S. The IRS asserted that DFM is the key to quality, basing this on my book, SMT Principles and Practice. As design was the difficult part of the process, manufacturing cost should have been determined essentially by the labor cost. 

Well, the OEM was not just going to write them a check for $1 billion in back taxes, so they sued the IRS. The only reason I got involved in this case was that the IRS was using my book to make their case. The lawyers for the OEM contacted me and wanted to know if I was quoted correctly by IRS. I was not. They quoted only part of a paragraph that dealt with the DFM and conveniently forgot to mention additional paragraphs that discuss the importance of other variables such as manufacturing processes, documentation, and training. 

I visited and audited all the major suppliers in the U.S. and overseas who built this board, looking at quality results on this product. The finding, to my amazement, was that all the U.S. suppliers except one had higher defect rates than their own overseas subsidiary. This was a complicated product with fine pitch devices and no-clean flux—a relatively leading-edge technology at that time. The reason their own subsidiary had much better results than anyone one else was because of a well-trained workforce, great documentation, and a focus on continuous improvement—essentially a world-class manufacturing operation that deserved the same if not more for producing higher quality product. Selling price is not determined by your cost but your quality. Selling price is determined by the market. Cost and quality are determined by the company. 

To make a long story short, after two years of investigation and a trial, the government not only lost the case, but was required to pay a $21 million refund because the OEM claimed overpayment of taxes. That more than covered their cost of suing the IRS. 

Conclusion
Quality and on time delivery are the two main challenges in a manufacturing operation. Having a strong internal manufacturing infrastructure is the key. It involves selecting the right equipment, working with your suppliers and customers, developing company-specific design and process documents, and training of personnel at all levels to produce high quality product on a consistent basis. Having a strong internal infrastructure of written, internally developed design and process documentation is the foundation you need to optimize your process. Producing good quality on a consistent basis requires a strong internal manufacturing infrastructure to succeed in a competitive global economy.   

Ray Prasad is the president of Ray Prasad Consultancy Group and author of the textbook Surface Mount Technology: Principles and Practice. Prasad is also an inductee to the IPC Hall of Fame—the highest honor in the electronics industry—and has decades of experience in all areas of SMT, including his leadership roles implementing SMT at Boeing and Intel; helping OEM and EMS clients across the globe set up strong, internal, self-sustaining SMT infrastructure; and teaching on-site, in-depth SMT classes. He can be reached at smtsolver@rayprasasd.com and offers in-depth SMT classes. Details about classes can be found at rayprasad.com. To read past columns or contact Prasad, click here.