Distributor design services blossom
By Rob Spiegel, Contributing Editor -- 6/2/2009
In recent years, component distributors have struggled to avoid competing on pricing. Given their low margins, price battles can cut deep into their flesh. Many distributors avoid price wars by competing with added-value services created to attract and hold design engineers. These services range from online training on new technology to consulting on specific design challenges. While most services for design engineers are free, some of the more complex services involve actual design work and are sold on a fee-for-service basis.
Paid or free, the goal of virtually all these design services is to support engineering teams that are under formidable stress, stress that has only increased because of the downturn. In recent years, the time-to-market on new products has compressed from six months to six weeks. Further, many of the engineering teams at brand owners have become smaller. After design engineering groups were cut during the 2001 downturn, most didn’t return to their former size when better times reemerged. The recent drop is demand has forced brand owners to cut even deeper into their engineering teams, forcing engineers to seek support services from their suppliers and distributors.
Given this environment, design services have become critical to the small- and mid-size companies that typically use distributors. Likewise is the case with specialty manufacturers in industries that produce “high-mix, low-volume” products such as medical equipment: They cannot always depend on strong supplier support, because in many cases they are not purchasing parts in large enough quantities to warrant individual attention from component manufacturers. So distributors fill the gap with a wide range of design services.
Melville, NY-based Arrow Electronics Inc, for example, provides its engineering customers with an Engineering Solutions Center in Colorado that takes technical questions from customers. The team of engineers at the center was created to field technical questions that are beyond the knowledge of FAEs (field application engineers). The engineers at the center work with both FAEs and directly with customers to solve design challenges.
Often, the customer is not aware of the full complexity of the part of system until the design is well into the design phase. “Customers often don’t realize the complexity of their design until it’s too late,” said Femrite. “They can get off into the weeds easily with the complexity. That’s when we get our first call.”
For suppliers, the distributor’s technical team serves as a proxy engineering team resolving issues with the supplier’s technology. “When the Engineering Solutions Center takes a call from a field applications engineer, they’re really helping me,” said Michael Fletcher, North American distribution marketing manager for Texas Instruments Inc (TI) in Dallas, Texas. He noted that the center’s engineers have gained a depth of knowledge in TI technology. “The Arrow engineers build their database of knowledge and build their relationship with TI so they can offer quality help with a good turnaround time.”
Similar to Arrow's Engineering Solutions Center efforts, Allied Electronics Inc of Fort Worth, Texas, offers a supplier-neutral group of design specialists that can be reached by phone or e-mail through the company’s Technical Product Support team. “You can’t have a guru for all out products in 55 branches, so we have a technical support group for technical questions,” said Russ Bullmer, director of technical product support at Allied Electronics. “It can be as simple as listening to the design engineer and verifying they’re on the right track.”
As well as seeking those with technical skills to populate its support team, Allied also looks for engineers who have direct sales experience. The goal is to bring strong communication skills to the team. “Successful salespeople know how to communicate and salespeople are not uncomfortable talking with customers and perfect strangers,” said Bullmer. He noted, however, these are people who have both sales and significant technical expertise. “We have 150 years of experience in the technical department. We don’t have people who are straight out of tech school.”
Suppliers have to depend on distributors to reach a base of customers that exceeds what the supplier can service alone. “Allied Electronics technical group is a trusted partner that we can depend on to provide the day-to-day technical support for the customers that we jointly service,” says Stacie Lease, distribution manager at R3 Texas in Farmers Branch, Texas.
Also based in Texas, Mouser Electronics Inc provides an online Project Manager that lets customers upload a bill of materials and match parts with availability. “We have a project manager online that allows engineers to go and build their product online and keep track of it,” said Kevin Hess, marketing director at Mouser. “They can use project manager to build as many projects as they want. They can also share the projects.”
The project manager is tied into Mouser’s system that tracks parts availability. When a part is on-order or as become obsolete, every individual project is updated with the new status. “If there’s a part that becomes not recommended for design, we let customers know and keep them up on pricing and stocking levels,” said Hess. “And if the product comes up for not recommended, we propose a replacement. They can see what alternatives are being recommended.”
When design engineers are ready to produce their products, then can simply indicate the quantity and the bill of materials becomes an order. “Customers can go in and say they want to build 10 units, and the project manager will create an order based on 10,” said Hess. “It becomes a library of all their projects and they can simply click and order.”
Web-based training is also a growing service trend distributors are offering to engineers and suppliers. Chicago-based Newark, part of the Farnell family of companies, has produced a variety of TechCasts, online seminars that act as short training modules that introduce new parts and technology to engineers. “TechCast was designed to make design information about our supplier products available to our engineers 24/7,” said Jeff Hamilton, director of marketing for design services at Newark. “Designers are embracing the Web.”
Newark introduced 110 TechCasts in February. Since then, the distributor has continued to add to its list at a rate of about 20 seminars per month. While the content of the TechCasts comes from suppliers, Newark produces them internally so they can ensure the modules serve the purpose of education, not marketing. “We produced all of the TechCasts. A lot of content is delivered by our suppliers, but we have an applications team that edits them and makes them technically oriented,” said Hamilton. “They offer system-level design insight. They’re not a vehicle for new product advertisements.”
The goal of the modules is to offer online training on individual components and systems that can be viewed at the customer’s convenience. The modules also include links to the parts being discussed, which is attractive to customers. “TechCast combines an extensive set of clear electronic tutorials with short time frames and a simple browser interface – making it very compatible with an engineer’s busy schedule,” said Michael Griffin, printed electronics research specialist at 3M Center – Corporate in St Paul, Minn. “The direct link to the parts being discussed is a nice bonus.”
For suppliers, the modules serve the purpose of educate its customer base in new technology. “A key priority for Freescale is educating electronic design engineers on the latest technology,” said Ryan Crouch, corporate account director for Austin-based Freescale Semiconductor Inc. “We believe that TechCasts are an excellent one-to-many education vehicle.”
The seminars are quick and to-the-point, averaging just 10 to 20 minutes each. This format is attractive to suppliers who realize their customers need fast technical take-away information, not a prolonged seminar. “We like the TechCast format because of its quick and convenient on-demand method of delivering technical information to a broad audience,” said Scott McKibbin, director of corporate distribution and customer service at Maxim Integrated Products Inc. “It is an exciting alternative to the traditional webinar format that tends to take much more time and effort to executive and is usually not able to be archived for playback at a later time.”
In addition to its online training efforts, Avnet Inc offers a range of in-person training workshops that teach new technology. The Phoenix-based distributor offers Speedway workshops that include full-day training, and On Ramp seminars that are shorter and usually in the range of one to two hours each.
Many of these workshops are offered at the customer’s facility. “We have specific Speedway seminars with full-day sessions and our customers walk out with hardware that’s already validated,” said Rafael Cruz, VP and director of design services at Avnet. “Customers can bring a design problem and get a hands-on deliverable.”
The Speedway and On Ramp seminars are created, produced, and delivered by Avnet engineers, so they’re more than just passed-along information from suppliers. As Avnet described, they are hands-on training with take-away technology. “These training workshops are all generated by Avnet, but they include supplier technology,” said Cruz. “We typically showcase specific supplier technology and the customers get pre-validated solutions that will work in their systems.”
Avnet maintains a team of experts that backs up its FAEs with deep technical knowledge. This team contributes to the development of the Speedway and On Ramp seminars. “We have a centralized team of experts that our clients can talk to about technical issues if our field application engineers can’t get to them quickly,” said Cruz. “We also use these experts to help create some of the content for the Speedways and On Ramps.”
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