OUTSOURCE PARYLENE COATING OR BRING TECHNOLOGY IN HOUSE
As an engineer or product manager of a manufacturing company, you know the impact and value a positive product experience has with customers. There are several product benefits achieved by applying parylene coating to critical technology products. As parylene coatings continue to gain traction among medical device companies, aerospace firms, and industrial electronics manufacturers, you may find yourself adding parylene coatings to more and more products in your portfolio.
As you increase your parylene applications, you face an important choice: Should you continue to outsource the coating process to a trained specialist, or should you expand your in-house operations and handle the coating process internally? This decision is not an easy one and you may not know where to begin as you evaluate both options. The best thing to do is to begin by considering the benefits of each option and then break down the decision making process into manageable steps.
What are the benefits of bringing parylene coating technology in house?
Introducing coating technology to your production team is a great way to position your company for future success and functional independence. The key to successfully bringing technology in house is to partner with a firm you trust who will provide the equipment you need and provide clear instructions on usage and maintenance. With the guidance of an experienced coating professional, you can incorporate coating technology into your operations and enjoy these benefits:
- Reduce the risk of sending parts to external providers
- Expand your capacity and breadth of services offered
- Maintain greater control of your production
- Enjoy fast, in-house access to parylene coatings
- Ultimately enjoy greater profit margins by eliminating shipping charges and paying only direct costs
As in the case of outsourcing, bringing technology in house is not without challenges. As a business owner or operator, you become fully responsible for hiring dedicated staff and ensuring that they receive comprehensive training on equipment and procedures.
What are the benefits of outsourcing parylene coating?
“By outsourcing, companies can achieve improved levels of efficiency. Even an extremely conservative estimate places the savings by outsourcing at a healthy 9 percent. Lower production costs lead to a decreased price for the consumer in a competitive market.” – Walter Block, Professor of Economics, College of the Holy Cross
Outsourcing offers a host of advantages to busy manufacturers. In addition to substantial short-term cost savings, outsourcing parylene coater services typically yields immaculate results. After all, your coatings are applied by highly skilled specialists who focus exclusively on parylene coatings. They typically have the latest cutting-edge coating equipment and technology, and handle all aspects of employee hiring and training. Here are some key benefits of outsourcing:
- Save money on hiring expenses
- Eliminate training hassles and costs
- Reduce your equipment expenditures
- Pay for coating services only as you require them
- Devote more of your in-house resources to product development
- Enjoy work completed by industry specialists
While these benefits are certainly enticing, outsourcing can foster dependence. And if your provider closes, temporarily shuts down, or is otherwise impacted by circumstances beyond their control, you may find yourself facing a supply chain problem. Finally, while outsourcing can help many manufacturers save money in the short term, it can end up being more costly in the long term.
What steps should you take to make your decision?
Outsourcing and in-house coating both offer a unique collection of pros and cons that can make it difficult for you to decide between the two options. If you find yourself at a crossroads or simply unsure about how to make an informed decision, then carve out some time to follow the seven steps below.
Step One: Consider strategic opportunity costs
Companies with a ‘can do it all’ attitude to manufacturing have a tendency to insource commodity parts that have minimal impact on improving product attributes that customers actually deem important. By tying up resources on activities that don’t help you create a distinct comparative advantage, focus drifts from enhancing differentiated or strategic components and employees lose sight of what the company is distinctively good at making.
If parylene coating does not directly impact what customers perceive as your most important product attributes or represent an area where there is a significant likelihood of gaining a clear technological lead, then outsourcing tends to be your best bet. But if parylene coatings protect or enhance those features your customers choose you for then considering an in-house coating system provides a key advantage over your competitors.
Step Two: Evaluate your current facilities
The parylene coating process requires ample warehouse space and equipment. Attempting to “squeeze in” a small area dedicated to parylene coating is not ideal and may compromise the quality of your results. Before you dive into the decision-making process, set aside some time to walk through your current facilities to see if you have sufficient space to allocate to in-house coating.
If you are already tight on space and leasing space does not make financial sense, then outsourcing makes the most sense, at least for the foreseeable future. The best way to understand facility requirements is to speak with a VSi Parylene expert.
Step Three: Assess the scope of your coating needs
“The host company must balance the needs of the site against the decision to outsource this work and negotiate an acceptable response time, such as 24 or 72 hours. Since a longer response time equates to more downtime and lost production, this response time must be clearly defined in the contract, or the host company may be unable to meet their goals and objectives.” – Manufacturing.net
Perhaps the most important factor to consider is the extent of your production needs. These needs must be balanced against the acceptable production capabilities of your outsourcing partner. Asking yourself whether your coating needs are short-term or long-term is another essential part of the decision-marking process. For example, does your company only require parylene coatings to prepare a one-time batch of 1,000 emergency ventilators to battle COVID? Or is your goal to become the leading long-term ventilator manufacturer in your area?
If your parylene coating needs are minimal, sporadic, or project-driven, then outsourcing is likely the best choice for you. On the other hand, if your needs are steadily increasing and you anticipate sustained growth, then it makes sense to establish an in-house team dedicated to parylene coating.
Step Four: Examine your budget
Much like the spatial limitations described in step two, a depleted budget can make your decision for you. You will need money to invest in coating equipment, employee training, parts, and supplies. Without the full commitment for an industrial-grade coating work cell, you can easily exhaust your budget by building an incomplete in-house coating station. And attempting to cut corners by purchasing used or outdated equipment may jeopardize your product quality and increase your downtime and maintenance costs.
Generally speaking, it is wise to outsource the parylene coating process if your cash flow is already sluggish. Even if you can scrape enough money together to invest in some equipment and supplies, remember that you will face equipment maintenance costs and training costs. Outsourcing, on the other hand, can actually help you stimulate cash flow because you can devote your in-house resources to other aspects of product development while an expert handles the coating process.
Step Five: Consider your time constraints
To go back to the COVID ventilator option described above, it might be impossible to meet an urgent deadline for 1,000 units using only a modest in-house team. When urgent requests emerge, outsourcing to a resource-rich parylene coating firm can prevent missed deadlines and disgruntled clients.
Keep in mind that it typically takes 3-6 months to install a system and train technicians. If you typically face tight time constraints or critical deadlines for your clients, then outsourcing can help you hit your target dates. In fact, some companies periodically supplement their in-house resources with outsourcing when facing critical deadlines. If you regularly find yourself facing large order requests with “impossible” deadlines, then having a trusted outsourcing option you can turn to is a must.
Step Six: Secure the buy-in of stakeholders and leadership
“This is an emotional decision for most managers. Even though traditional competencies may have eroded or become commodities, organizations have a deep psychological reluctance to abandon what was once a core subsystem to a supplier… Where a significant competence gap exists, managers are better off partnering with a capable supplier.” – Ravi Venkatesan, Harvard Business Review
Installing a parylene coating line requires team commitment, stakeholder buy-in, and executive support. Even when the economic, strategic and operational advantages are obvious for bringing parylene in-house, the risk of project failure is likely if 360° stakeholder buy-in is inadequate, or fluctuates throughout the project. Regardless of the decision you make, here are some ways to ensure that all key personnel are supportive and on the same page:
- Outline exactly how the decision will benefit each department
- Be transparent when explaining how the process will impact operations
- Communicate with all staff about upcoming changes and go-live dates if you choose to bring technology in house
- Develop a robust and ongoing training schedule to ensure employees will approach the coating process with confidence
- Make sure all employees are aware of safety guidelines associated with coating equipment
Step Seven: Re-evaluate your decision as your business evolves
Your business can change dramatically in a year or even six months. And the decision you make today may not be the best option for your company a year from now. The best way to ensure that you move forward efficiently is to re-evaluate your options at least once or twice per year. Even if you choose to continue outsourcing, it’s a good idea to revisit the price structures you have with your provider. And if you apply coatings in-house, it’s wise to re-evaluate your equipment and technology to ensure that you are remaining focused on quality improvement.
What is the key to making the best choice for your business?
Clearly, there are many factors to consider when deciding whether to outsource the parylene coating process or bring the technology in house. The single best way to ensure you make the proper decision is to schedule a complimentary consultation with a VSi Parylene expert. An experienced parylene coating specialist will meet with you and examine your production goals along with your supply chain activity to choose the best option.
For over a decade, the VSi Parylene team has delivered the highest quality parylene coatings and service to medical device manufacturers, aerospace companies, and electronics manufacturers. In addition to parylene coating services, we offer the equipment and training you need to bring parylene coating technology onto your production floor.
Visit our Parylene Services Model page to learn more about parylene coating services for all stages of your product’s life cycle.
Download our POD brochure to learn more about bringing parylene in-house.
Contact us to discover how parylene coatings can help your specific application.