SigmaPoint’s lean strategies make it an attractive option for electronic manufacturing—but can it convince companies to reshore to Canada?
Could you imagine your company turning down a million-dollar contract? What if, by doing so, you help the company supplying the contract remedy an issue they didn’t realize they were going to have later down the production line?
No one would be surprised if a majority of companies out there would still take the contract—this is business, after all. But SigmaPoint Technologies, an electronic manufacturing services (EMS) provider, saved a client a million dollars of heartache and would do so again.
“It’s not standard practice to refuse a purchase order of this size, surely,” said Steve Blouin, Vice President of Engineering at the Canadian-based company. “But in this instance, it would have created an incredible amount of waste. The client didn’t have enough time to install all of the products he had ordered up front, and it would have been financially very bad for his company, creating unnecessary inventory.”
“We provided the business with the best solution for them.”
SigmaPoint is a contract manufacturer that provides end-to-end assembly services for complex electronic products in the computer, telecommunications, medical, defense, industrial, alternative energy, and transportation industries. The company assists during the design stage to final high volume production, always focusing on eliminating waste through the product life cycle.
It’s unusual in the EMS space for a provider to be as committed to lean practices like SigmaPoint is. To them, it’s just good business.
“The competition asks for a minimum order quantity, and will often give a better price if a customer places a bulk order. But that’s not acceptable to us,” Blouin said.
“This just creates waste for our customers and us. We work with our customers to understand their forward view, adjusting their requests on flat demand to deliver a little at a time.”
Originally, SigmaPoint worked like a traditional company—the organization would look to improve through Kaizen events, continuous improvement strategizing opportunities to make small changes in processes. But after several one-week projects, the leadership team realized that this model became hard to sustain, and wasn’t producing the lean environment in which they wanted to operate.
In 2008, the company decided it was time to utilize with a better structure, including the Toyota Kata Methodology and a full re-engineering of the management structure for better service and continuous improvement.
“This change has turned SigmaPoint into a machine of continuous improvement,” said Blouin. “Once the lean direction was decided upon, the leaders brought its strategies to the vision of the company.”
The provider of electronics to one of Canada’s biggest military companies for the last five years was able to deploy its value stream just a couple of years later, and its lean enterprise model took full shape.
“It’s unusual to apply these lean strategies in the electronic markets. But it turns out that whether you’re building shoes, cars, or complex electronics, the same principles in production hold.”
Through its lean initiatives, SigmaPoint creates value while building a product. The company’s continuous investment in its innovative facilities—and state-of-the-art prototyping technology and Kitchener/Waterloo facility, Catalyst 137, and an SMT line capable of building a product from beginning to end—means SigmaPoint is always ready to help design, develop, and produce the next piece of cutting-edge tech.
So what’s the goal of these lean initiatives? To convince more Canadian and North American companies that their products can be built at home—and not overseas—for a reasonable price.
“There’s willingness from the market towards reshoring,” he said. “Many companies are trying to build their products in other places, but find themselves coming back to North America.”
SigmaPoint Technologies has deployed a rebranding strategy to capitalize on the beginnings of this trend away from off-shoring.
To offer a product of equal or better quality than overseas, and a pricing structure that is just as competitive, the company has a few key strategies it sticks to.
“We ask our customers an unusual question: what price are you willing to pay for our service? To be able to do this, and receive an honest answer in return, takes trust.
“Most of the time, they come back with ‘If you can build my product under a certain price, I’ll stay in Canada.’”
But as we learned from the anecdote at the beginning, it’s not all about the money. Working with a Canadian company in a nearby time zone, who can meet face-to-face when necessary, is often more than worth it.
That’s what the rebrand is based on: educating the customer about SigmaPoint’s capabilities and the benefits of reshoring.
“You wouldn’t believe it, but dealing with tech, that’s the easy part,” Blouin said. “The way we are able to extract waste from any process, that’s where the work is. At the end of the day, improvement is about building good processes, and that’s something we’re committed to continuing.”