coverdn.jpgRequired reading for anyone in hi-tech manufacturing is this “warts and all” perspective on outsourcing to China.

Thanks to Design News
— a magazine I used to write for regularly — for an entertaining and
practical account of a US engineer's experiences in China as he
grapples with subcontractors, scours markets for vital parts, and much
more.

Al Mudrow's company, WiLife,
makes digital surveillance cameras and for its latest model, it decided
to outsource the manufacturing to a contract manufacturer (CM) in
China. The CM is actually an unnamed Taiwanese company which, like the
rest of Taiwan's electronics industry, now does most of its
manufacturing in the PRC.

The article covers Mudrow's visit to the factory, in Dongguan, Guangdong province, earlier this year.

Needless to say, things didn't go quite as planned. Design News is aimed at engineers so the technical details of the project may be heavy-going for those without an electronics degree.

However,
there are issues that every can relate to, particularly one moment when
the CM's design engineers in Taiwan wants to redesign the product to
make it easier for them to manufacture. Mudrow refuses and the
submerged cultural frictions between the American client, the Taiwanese
project manager and the local Chinese employees come to the surface:

At
this point the project manager loses control and begins screaming at us
in Chinese. The intended effect is to intimidate CM's team into backing
her position. She's probably not aware that I have been taking Mandarin
language courses and am able to understand much of what she is saying.”

Mudrow's
Taiwanese minders are due to fly back to Taiwan the next day. So, when
he asks to return to the Dongguan factory to sort out another issue,
their feathers are ruffled even more:

The
Taiwanese are loath to let their customers interact directly with the
factory staff. If customers become comfortable dealing directly with
mainland Chinese, of what value then are the Taiwanese?”

One of the Taiwanese engineers therefore volunteers to remain in China until Mudrow leaves.

Mudrow
makes the point that the CM was perhaps out of its depth in taking on
the project as it was more familiar with simple electronic devices like
mice and games controllers. Nevertheless, the CM knew that before it
started and wanted to work with WiLife to enhance the capabilities of
its Chinese facilities.

The article argues that most Chinese
manufacturers sincerely want to achieve world-class quality standards.
But the reality is often different and they can be more concerned about
following assumed standard procedures rather than focussing on quality
from the point of view of the end-user.

The article also
reinforced the importance of using personal contacts to find good
sources in China. Indeed, a key part of the engineer's mission to China
was to broaded these contacts. WiLife had previously identified some
possible Chinese suppliers using well-known internet sources like Alibaba or Global Sources.

But
these suppliers always need to be evaluated and that means talking to
customers and visiting their factories. Indeed, one possible supplier
that WiLife found via the internet was clearly upset that WiLife's
engineer preferred to visit its unassuming factory rather than the
company's gleaming new sales office in Shenzhen.

Surprisingly,
perhaps, the WiLife camera project was successfully completed on time.
But who knows what might have happened if Mudrow had not arrived to
take a hands-on approach to managing the Chinese factory.

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