Barbara Jorgensen
Editor
barbara.jorgensen@
electronics-sourcing.com
June 2010 Vol 1 No.3
Learning fromhistory
It’s been a number of years since I attended EDS and I couldn’t have picked a better time to get reacquainted with the show lastmonth. The sudden uptick in component demand is a welcome sign to everyone in the electronics industry— some folks even seemed a bit shell-shocked—but nobody is complaining. The only good thing anyone had to say about 2009 is that it’s over.
Still, as TTI’sMichael Knight reminds us on page 32—thememories of the
excesses of 2001 are never far away. I, likemany veterans of the dotcombust, believe history will not repeat itself. For one thing, I’d characterize the current cycle as a bust-boom, rather than a boom-bust.
Manufacturers are being very cautious about bringing back capacity—even if
it could happen overnight (which it cannot.) The supply chain of 2010 is very different than the supply chain of 2000/2001—more data is being shared from the OEMto distributors and suppliers in the hopes of reflecting real demand. Supply chain technology ismore sophisticated and suppliers, distributors and OEMs have the opportunity to track their orders and forecasts in real-time. Forecasting remains an imperfect science, but there is a lotmore visibility into short-termdemand than there was 10 years ago.
There will be speed bumps as wemove forward, and the biggest one I see is
the effect of offshoremanufacturing.Much,muchmoremanufacturing capacity is now overseas than there was 10 years ago. Even though technology shouldmake this transparent—demand is demand nomatter where it originates—the reality is the industry still operates in geographic silos.When the order placed at Point A is incomplete at Point B, substituting parts at Point B is the quickest solution. I don’t think this will necessarily cause the excess inventory we saw during 2001, but it is something the supply chain should keep an eye on as we ride the up cycle.
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Fromthe Top Navigating amarket shortage
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View fromthe EU Cut to survive
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