Justifying The Automation
Of Odd-Form Assembly

Published By:
Assembly Magazine
February 1998

The Automation Of Odd-Form
Since the fall of communism, almost two billion more capitalists have been added into the world market. With demand for consumer electronics in developing countries escalating at double-digit rates and the volume of electronic manufacturing on the domestic rise, complete automation solutions have become the strategic choice for those who strive to be global market leaders. In today's extremely fast paced and competitive electronics environment, OEM's and contract manufacturers are forced to streamline their costs anywhere they can to compete in this relentless industry. Today's customers want the product offering to be of the highest quality and still be very reasonably priced. Given the amount of global competitors vying for the same piece of business, you can be sure someone will find the solution to do it.

After spending several decades improving the automated placement of standard surface mount and through-hole components, the industry has logically started shifting some of its focus to automating odd-form assemblies. Through-hole is not likely to go away. It has proven reliability, reasonable cost, and availability at a time when so called "standard" components have become scarce. The need to adopt flexible automated odd-form solutions has never been greater. Of equal importance in the shift to automation is the fact that labor and rework costs consistently account for a major portion of the manufacturing expenses companies incur daily. Both directly impact the price and quality of products a company may offer and how quickly it can get these products to market. Today, "product to market" cycles for the major industry movers, like computers, disk drives, and portable communication products are half of what they were just a couple of years ago.

Companies, like Delco Electronics Corp., keep themselves on the leading edge of their industry by using the latest in odd-form technology. In fact, the recent use of automated odd-form technology has positioned Delco Electronics as a PACE award finalist this year and assisted the company in building an air bag crash-detection sensor that is 47% smaller, has 48% fewer parts, and costs 58% less than its predecessor. This is just one example of the many successes companies are experiencing as they make the transition into the automation of odd-form assemblies.

Fifteen years ago automated odd-form assembly was virtually non-existent, which left manual assembly as the only option. That has all changed with the continued development of flexible tools designed for odd-form assembly systems that are fast, reliable, and low cost. It is not uncommon for current technology in the automation of odd-form to achieve throughputs matching those of some standard pick and place machines while achieving even greater flexibility, accuracy and line utilization. Today, with the advancements that have been made in the area of odd-form assembly automation, good suppliers are able to offer solutions that utilize a set of standard modular tools combined with a system configuration that makes sense for the customers' particular application. This approach allows more flexibility for present and future projects due to the ease of simply changing or reconfiguring the modular elements, such as assembly heads and feeders, on the current system for use in new applications. Assembly of odd-forms is no longer out of reach and no longer needs to be a burden on today's manufacturers. The automation of odd-form is a simple yet effective three-step process for meeting the all encompassing challenges of how and when to best use available technology to streamline your manufacturing process.

STEP 1 - Defining Your Current Requirements
The first step in the justification process is having a thorough understanding of your company's current operation, global strategy, and the requirements needing to be met to ensure the two are congruent. Begin by asking the following questions:

BUSINESS ISSUES

1. Justification and Budgetary Cycles - How do you justify the purchase of capital equipment? What is important to you--labor replacement, burdened labor rates, yield improvement, improved quality, etc.?
2. Timing - When do you need the equipment on site? When is the pilot run? What is the production start-up date?
3. Throughput - How many boards do you want to produce per shift?

TECHNICAL ISSUES

1. Circuit Board Sizes - What are the maximum and minimum dimensions of your circuit boards or carriers?
2. Parts Mix - What components are placed/inserted for this application? How many different products will be run on the line? It is recommended that you develop a matrix for each product that identifies the component description, packaging, and insertions per board.
3. Packaging of Parts - What packaging is defined or to be defined for the above matrix of components? Tube, Tape, Bulk, Tray? Have you considered the packaging costs associated with each alternative?
4. Lead Forming/Cutting Requirements - Do your component leads require cutting, forming, clinching?
5. Equipment Interfaces - What are your requirements for interfacing with a host and other equipment?
6. Floor Space Limitations - How much floor space is available for this equipment?

Not only does beginning, with the end in mind, more clearly define your existing operation, but it also identifies the information that your odd-form specialist will need in determining the best solution for your application. Also, by beginning with complete and accurate information, supplier lead times are likely to be reduced. This means shorter product to market cycles, and thus, a better competitive position.

STEP 2 - The Cost Justification
The second step in the automation process entails a simple yet effective method to justify the feasibility of making this transition into odd-form automation. This formula calculates the average placement of parts, burdened labor rate, defect rate, and repair rate for both manual and automatic assembly lines to give a comparative cost per part for each approach. Recognize that this isn't the only way to analyze each method, but it provides an effective bottom line comparison. The table located below represents one of several ways to calculate the cost justification for odd-form equipment. Once the cost savings per part has been calculated in the justification table, you can use the figures to calculate the ROI of the automated odd-form equipment.

Bottom line, return on investment can be recouped in as little as 11.8 months. Output is increased significantly from 9000 parts to 36,000 parts per two-shift operation while the total cost per part is reduced from $.043 for manual insertion to $.010 for automated insertion or 77%. The line is utilized more efficiently with greater up-times, and there is a safer more disciplined manufacturing process in place. Some other key benefits of automation commonly overlooked but no less important are the residual value of the system, the versatility of the system and mix of applications it can run, the greater quality and consistency achieved, and lastly, the reduction in occupational safety issues.

STEP 3 - Making Your Recommendation to Management
When reviewing any recommendation, management expects to see intelligent and concise proposals. Given the multiple hats most of us wear today, this isn't always such a simple task. It's due to this scarcity of time and the complexities of any capital acquisition that suppliers are regularly required to provide detailed justification analysis to customers and are more than willing and qualified to do so for you. Odd-form suppliers have become experts in the design of flexible, reliable, cost effective solutions to meet your present and future application needs. For these reasons, we suggest using them to support your recommendations by having them help with the required financial analysis and implementation plans to present to management. The more you use your supplier as a consultant the more efficient you'll be.

The cost justification phase of your recommendation should show the ROI for each piece of equipment proposed and a detailed cost analysis for the current manual lines versus the proposed automatic line. Additionally, the implementation phase of your recommendation should take into account the projected start date established in Step 1 of our model and outline what training and support will be given during start-up. You should also include any additional training requirements on or off site. Each system being recommended should be documented, along with its respective specifications, to include throughput, placement accuracy, error detection and recovery, changeover time required, feeders required to place specified components, board location methods, etc. It should also outline the number of operators needed to run the new line, what requirements they should meet, and how productivity will be tracked. In addition, a maintenance schedule should be attached to include cleaning requirements, mean-time-to repair, and mean time between failure. By placing these responsibilities with your proposed supplier, you not only make them more accountable for what they're promising but you also lay the foundation for a solid partnership on current and future projects.

CONCLUSION
PCB assemblers who wish to survive in this dynamic industry can no longer afford to ignore the bottleneck created by the manual insertion of odd-form components. Doing this compromises both the quality and speed of the line. With rising labor rates and humans error, manufacturers can't afford not to use the automated odd-form solutions being offered. Take time to walk through each of the three steps recommended and expect more of your supplier as a consultant. You'll be surprised at how easy it is to justify the automation of your odd-form applications.

Copyright © 2000 CHAD INDUSTRIES, INC