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Endicott Interconnect Technologies, Rising star

Manufacturing in Action, Source : The Manufacturer US
Published : July 2007

Endicott Interconnect Technologies, a leading electronic interconnect solutions and electro/mechanical equipment supplier, focuses on diversifying and growing its business by relying on quality and reliability. Linda Seid Frembes finds out more

When Endicott Interconnect Technologies (EI) of Endicott, NY, divested from IBM in 2002, its new owners knew that a solid strategy of technology investment, vertical integration, and diversification was necessary to achieve success in a competitive marketplace. Fast-forward five years and the strategy has paid off. “Over the past year, we have been successful in expanding into markets like military and aerospace due to our high quality and reliability,” says Jim Fuller, EI’s vice president of PCB and semiconductor packaging fabrication.

So successful, in fact, that the US Department of Defense has awarded EI multiple contracts totaling $164 million to produce card frame assemblies including organic semiconductor packaging, module assemblies, printed circuit boards, full functionally tested circuit board assemblies, and engineering services in support of a high-reliability, high-performance computing application. “Our technical expertise and collaboration with the customer in the assembly and test of the modules and integrated card frame were key factors in winning this business,” says Wade Phelan, vice president and general manager of complex assembly operations at EI. “This DoD contract represents a significant contract for us over the next several years. It touches all departments from substrates to panels, assembly, and testing. By offering a fully integrated model, we were able to share a greater role on the bill of materials.”

According to the press release, the customer also pointed out that “it is becoming increasingly difficult for the government to find domestic sources with the technology, engineering, and manufacturing prowess required to meet the demands of these government programs.”

And it is EI’s vertical integration that differentiates it from others in the market. EI has honed its expertise in the fabrication and assembly of complex printed circuit boards, advanced flip-chip and wire-bond semiconductor packaging, and precision equipment manufacturing and integration. It has packaged that expertise with services that complement these offerings: design and layout; thermal, electrical, and mechanical modeling; reliability and environmental testing; and physical analysis. “Our customers like the vertical integration model; it provides cost savings and convenience for the customer. There is no shipping the project from vendor to vendor to get things done,” says Fuller.

Over the last 18 months, EI has responded to tremendous growth by tripling the assembly workforce; output has risen by 400 percent in the same period. Phelan notes, “We’ve also added new equipment. and our tools are operating at 70 to 80 percent capacity. Looking ahead, the complex assembly group expects to see 150 percent year-over-year output growth.”

EI resides on a 4-million-square-foot campus (of which it occupies 1.6 million square feet), but lean manufacturing tools are helping to optimize space. “We’re adding new lean tools as well as Six Sigma training; we have to solve problems faster due to our growth rate,” explains Fuller. “The goal is to continue our improvement and stay competitive. We’re constantly feeling pressure from Asia and from larger companies with different infrastructure.”

The company is also refreshing many of the lean tools that were introduced earlier in the program, like cycle-time reduction and layout optimization, because “two-thirds of my workforce wasn’t here 18 months ago,” says Phelan, who is also replacing the production floor control system to keep up with new customer data requirements.

“We’re a company that is tenacious and has vision,” says Fuller, who also notes that EI has registered 36 patents since its divestiture in 2002. “We have a tremendous advantage due to our roadmap; we’re already thinking about 2015 and 2020. Customers want to know that you’re thinking ahead for six to 12 years and keeping up on technology advancements.”

In May 2007, the DoD awarded EI a $49 million follow-on production contract that includes a $5 million contract for research and development of electronics packaging technologies including printed circuit boards and substrates for the next generation of high-productivity computing. The contract serves as the first of a three-phase, five-year program that utilizes EI as a DoD research arm. In the meantime, EI’s incremental success in market segments such as medical, telecom, and semiconductor contribute to its rapid growth.

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