You Won or Lost the Design. Now What?

The design socket is critical in the electronics industry. Components suppliers who win the stiff rivalry for an OEM design often get not only the sales but significant boasting rights, which can be parlayed into further wins elsewhere.

That’s why we all want to know as much as we can about design engineers. Component distributors say they know design engineers. So do semiconductor and other electronic component suppliers. Heck, anyone with a role -- however remote – in the electronics industry supply chain believe they know and understand design engineers and the design engineering community.

Even logistics companies serving the electronics industry know quite a lot about design engineers; where they work; what they do; their educational background; political and religious affiliations and; whether or not they are fearful about the future. There have even been research showing many Western design engineers in the electronics industry don’t want their children following them into the profession.

That’s how well we know and need to know engineers. There are numerous websites and publications catering to design engineers, many of them touting decades of serving the industry. Research reports based on surveys meant to ferret out more information about design engineers are annually issued by major trade media in further signs of the electronics industry’s desire to get a better handle on this core group.

The reason we go to this length to understand engineers is because they’ve been cast as critical to clinching sales. Get your product designed-in or get the socket (as the industry lingo goes) at a major OEM and you can start printing money as sales skyrocket.

Except that’s often not enough. We don’t know enough or seem to care sufficiently about the other support crews that work with design engineers to translate their conceptions into saleable products. These include people in purchasing, inventory management, production, stock keeping, logistics, after-sales warranty fulfilment, etc., without whom the engineer’s idea is only a puff of smoke.

Engineers are important in the design and supply chains but they don’t work in a vacuum and oftentimes they lack the powers that have been ascribed to them. To really seal that deal distributors, components manufacturers and design firms not only need to know and understand engineers but must understand the ecosystem in which they work and all the other players in the system.

Here’s a story from the field. A sales rep tried to get a semiconductor company to speak to purchasing folks at several top OEMs but was rebuffed. “We don’t deal with purchasing and we don’t need to because we work with engineers to get our products designed into OEM products,” they said. Further hammering the point home the marketing executive at the components vendor noted that his company’s products are so proprietary that once they get into a socket, “you can’t simply swap them out for a cheaper part. The cost of the redesign would simply be too high.”

They’re right. And I almost bought the argument until further reflections point to the faulty underpinnings of this argument. The initial advantages of a proprietary design-win are fleeting. In the electronics industry, pricing pressure is so severe it doesn’t take that long for a redesign to become not just cost-effective but highly necessary.

Even when a company bids for a proprietary design it has no guarantee of winning; the competition is fierce because companies can command higher margins when the design engineer includes their components on the PCB, for example. It takes a lot of money and time to develop unique electronic parts and the company that fails to get its product designed into that hot OEM equipment may face huge write-offs as a result.

Recouping the initial R&D investments and perhaps some profits may require adapting that same components for a different OEM. With a few tweaks here and there for other potential buyers, a components vendor may end up turning the unique part that failed to win the design socket at one OEM into a huge winner at a bunch of other OEMs.

That’s why you talk to purchasing. But don’t wait until you’ve won or lost the design. Talk to them all the time. You’ll win a partner and possibly a friend for those days when the design socket ends up with the competition.

DISCLAIMER: BOLAJI OJO IS EDITOR-IN-CHIEF AND PUBLISHER AT EPS. THE VIEWS EXPRESSED IN THIS BLOG ARE THOSE OF THE AUTHOR ALONE WHO PROMISES TO BASE HIS SOMETIMES BIASED, POSSIBLY IGNORANT, OCCASIONALLY IRRELEVANT BUT ABSOLUTELY STIMULATING THOUGHTS ON THE SUBJECTIVE INTERPRETATION OF VERIFIABLE FACTS ALONE. ANY COMMENTS SHOULD BE SENT TO THE AUTHOR AT BOLAJI.OJO@EPSNEWSONLINE.COM.