Monday, June 15, 2009

The Good Humor Man

Summer is here and living in the quiet suburban landscape of Cleveland we know summer has arrived by more than the occasional snow or dense tree pollen that looks like fog. We know it because the Good Humor man starts driving down our streets. Maybe in yesteryear, this guy was something akin to the milkman, but today, the driver is not someone I want my kids buying ice cream from. His truck looks like the beat-up old Ford from a horror movie, his Good Humor sign has seen its day and sticks to his truck oddly, and the ice cream came from the bulk section of a food distributor. Why do we buy this stuff?

We have been visited by the Good Humor man of optics and the last two months have been pretty hard for COTSWORKS. I relate this story because “distribution” and “manufacturing” are not what they used to be. The modernization of China and Taiwan have created a new threshold for commodity manufacturing. Ask the American worker what they think of China and you’ll get a string of complaints. Ask the same worker about how the material things they have in their house compared to their parents, and you’ll get a list of plastic and drywalled items that we take for granted but were the pervue (in finer form) of the rich and gentile of yesterday. Ask many small business owners, and you will find that many are basing their businesses on going to China to get parts made then marking them up substantially and calling it a business with value.

Of course, access to the customer is what matters, but where is the value here? And, how defensible is this as a business? How long will it be before the Chinese manufacturers call our customers, ourselves. We get besieged now by vendors trying to sell us parts and they are ruthless salespeople. In Europe it seems, they have already made many inroads.

What caused us problems, is that you cant put much faith in a brand anymore, say, Good Humor. We bought lasers from three of the most respectable sources only to find that the quality varied across the lot of parts we bought. And when we went back to them and showed them the broken welds, extra solder, non-hermetic seals, we didn’t get a full corrective action report. We got, “we will talk to manufacturing.” Which means that an email was sent and maybe a Skype call at night.

For Military, Aerospace, and Industrial optical transceivers, this just doesn’t work. There is no way that one person’s Industrial Temp. part is not another's…it either works at -40 to 85C or it doesn’t. Summer or winter, it’s always snowing at COTSWORKS, . I’ve started tracking the temperature around here and we see swings of 50 degrees F in one morning. Dew or condensation builds up and if it has salt or dirt in it corrosion on an OSA wire bond will happen in days.

I stopped wondering about why military parts cost so much when I read a story about Hyman Rickover and the US nuclear submarine fleet and how someone substituted lower cost portable toilets on the subs. Seems that the lower cost ones cracked when used up in the Arctic and sailors could sit on them and fall over…onto the ice or water. The higher quality and testing doesn’t manifest itself in every use but rather once in 100 or 1000 or 10,000. And that once can mean drastic consequences. But more importantly, it’s that there is no other toilet. With Datacomm…you pop the transceiver out and put a new one in.

Sadly, I’ve also learned why things cost so much in the military and aerospace world…and that’s time to market. We have two big programs in the works that will take five years or more to see production. The last few months have been really tough with the airline market in general collapsing. But that which does not kill you…in this case, makes you poorer. I hope things turn around soon; I hope the Dreamliner finally becomes the Realityliner.

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