Trends in Manufacturing, such as Original Design Manufacturers (ODMs), Lead to Collaboration and Consulting-Like Services

In an interesting development, OEMs (original equipment manufacturers) of a wide range of products and components, from computers to hard drives to automobile components, now consult intensely with their clients in the product development phase, prior to providing the actual manufacturing. This has led to the evolution of some OEMs into ODMs (original design manufacturers). These ODMs consult with, design for and then manufacture for their clients.

For example, an ODM might determine the needs for an in-dash stereo/radio system of an automaker client, design the system and finally manufacture the system. The automobile industry has become an environment in which major manufacturers, such as GM, rely heavily on a handful of component and systems manufacturers, such as Delphi, to consult in the design and engineering phase of new car planning. The newest generations of aircraft at Airbus and Boeing are designed and manufactured to a large extent by ODM partners scattered around the globe.

The consumer electronics and personal computer sectors are heading in the same direction. Contract electronics manufacturers such as Flextronics consult heavily with their clients in the design of new products such as computers, stereos or telecommunications equipment.

As technology has advanced rapidly and microchips have become integral components of many everyday items, consulting on design and implementation has become necessary to many types of manufacturers. Likewise, many types of service providers, such as those in telecommunications, must consult to a large extent with customers regarding their systems’ needs. Consulting in these types of situations may or may not result in additional fees but can be vital pieces of the complete sales cycle. In many cases, the consulting functions at manufacturing and services firms have been developed into true profit centers with specific fee structures.

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Trends in Manufacturing, such as Original Design Manufacturers (ODMs), Lead to Collaboration and Consulting-Like Services, Business and Industry Trends Analysis

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