Over the past five years, 43% of new electronic products have missed their initial launch dates, according to manufacturing optimization platform provider Instrumental’s first annual State of New Product Introduction (NPI) Survey of more than 100 leaders in electronics design, manufacturing, and engineering. Instrumental said this points to the industry’s failure to adapt to increasing product complexity, faster delivery timelines, and increased supply chain volatility.
Although survey respondents cited on-time product delivery as their number one responsibility, they reported that 43% of new product programs over the past five years were delayed from their initial ship date. This is comparison to a May 2020 survey that reported that 53% of electronics programs had been delayed or cancelled as a direct result of the pandemic.
The top factor impacting on-time completion and product release of programs in 2021 is disruption to the supply chain, according to 46% of respondents, followed by engineering bandwidth or headcount (44%), and unable to travel to factory (43%).
Image: Instrumental
Engineering time is a big contributor to the problem with teams reporting that 76% of engineering time is spent on non-engineering tasks like inefficient communication, reactive issue discovery, and status reporting. On average, teams reported that only about 23% of engineering time is spent directly on creative design or engineering tasks.
Image: Instrumental
Engineering turnover is another factor that impacts companies, leading to overworked engineers. The survey revealed that 71% of mechanical and hardware engineers work overtime or in the evenings and on weekends on a regular basis.
When asked ‘what are the most important goals to achieve in a program,’ 77% of leaders said launching on time and meeting program deadlines, followed by hitting bill-of-materials (BOM) cost targets (53%), and meeting product feature goals (53%).
However, 55% of NPI teams cite limited engineering time as a primary obstacle for NPI, followed by product complexity (52%) and partial or incomplete data (40%). In addition, 58% of engineers reported that they have the resources to be successful, which means 42% do not have the necessary tools.
Although NPI leaders have acknowledged the need for improved engineering capacity, most organizations are lagging when it comes to adoption of technology that could automate time-consuming development tasks like forensics and data analysis, said Instrumental.
The survey found that only 12% of teams use an AI-based defect detection system, and over 91% still rely primarily on spreadsheets for things like task tracking and analysis.
In addition, only 23% of respondents reported that their company uses a line or build analytics tool and only 22% use a BI tool. Another surprising finding is only 42% of new product introduction teams have access to their data in the cloud.
Looking ahead, leaders are most concerned with hiring and improving existing teams when planning for NPIs this year. The survey revealed that 65% of respondents are focused on improving engineering efficiency and 51% are planning to explore suppliers or contract manufacturers in a new region.
Innovation also will be a big part of processes deployed in 2021. Three of the biggest changes teams made to their NPI process since 2020 were to their manufacturing process such as formalized and standardized checklists, according to 31% of respondents; hiring more staff, redefined roles, and increased collaboration efforts, according to 25% of respondents; and implementing new tools and virtual meetings, according to 20% of respondents.
Other key findings indicate that leaders do not agree that their companies are advanced in implementing innovative technologies, people operations is key when considering barriers to supply-chain level issues, and builds are delayed frequently enough to have a measurable impact on business costs and staff efficiency, said Instrumental.
Image: Instrumental
Instrumental calculates the direct cost of reported engineering efficiencies is $26.2 billion in annual waste for consumer electronics companies in headcount cost alone. This translates into a potential $250 billion revenue loss annually due to the inability to ship more products quickly, according to the company.