Return Analysis And Solution Study On Equipment Investment For EMS Industry

To provide the analysis methodology and solutions on equipment investment return for EMS industry is the purpose of this document, especially provide the guidelines for the local EMS which are on the road to compete with global enterprises, so that they can keep the pace with the trend in concept and practice, and achieve the objectives with less frustration.Based on analyzing the status of EMS industry and related equipments, focusing on the most important process– component pick & place, breaking the barrier of traditional cost account allocation, the concept and calculation of Single Placement Cost emerges in this document and is regarded as sole financial justification for return assessment on equipment investment; and the impacts to equipment investment return are described in details in this document so that the readers can easily understand the concept and know how to utilize it as reference.The definition of Overall Equipment Effectiveness (OEE) is redefined in this document to facilitate the full utilization of the equipment, extended to single minutes and maximum pick & place speed so the target and strategy to enhance the return on equipment investment is clear absolutely and not confused. Some methods are also introduced in this document and illuminate the ways to build up competition advantage.The new concept and solutions in this document is refined from the practices in EMS giants, and has been put into use in some areas, for example, by changing equipment management strategy, a local equipment was introduced in Solectron Shenzhen and US$1.94 million was saved, by redefining the calculating of OEE, the capacity of an equipment matrix to invest was estimated exactly for the project involving US$150 million, and got the excellent result on single placement cost. The return analysis and solution on equipment investment are recognized gradually and contribute to the industry.