Global Market Trends and the Strengths and Challenges for Japanese Companies

Tsukagoshi : There are three things that I feel are changing in the global marketplace: First, there is polarization. The second is the “widening gap between the two. The third is “oligopoly,” in which powerful companies gain an advantage through mergers and acquisitions.

What are the advantages of Japanese companies in the global market? Both of them stress that “quality” and “reliability” are the key factors. On the other hand, as globalization progresses, it is becoming increasingly difficult for Japanese companies to handle all processes on their own. The challenge for Japanese companies is how to communicate their superiority to the rest of the world and build a strong and flexible supply chain.

Dr. Mitchell: These days, we are becoming more globally connected, with ‘connected’ as the key word. Japan is a leader in the electronics industry, but it has historically been inward-looking, so changing that environment will be a big challenge.

Advantest’s introduction of IPC was triggered by its acquisition of Verigy, a company spun off from Agilen Technologies.Until then, everything had been manufactured in-house, but Verigy utilized an EMS, and two different forms of production were incorporated into the company. This process has allowed the company to introduce international standards, but by comparing and complementing existing in-house standards, the company has been able to smoothly incorporate them without confusion.

Mr. Ito: After comparing the in-house standards we originally had with IPC, we found that the required quality was almost the same. Our soldering standards were able to meet Class 2 of the IPC without any problems, and there was no major impact on the work content or quality, so it was not that difficult. On the contrary, many people said that it was good to be able to “visualize” what class of IPC our in-house standards correspond to, what level our technology is at in terms of the global standard, and where the gaps are. We usually use IPC when we are in trouble because it is difficult to make decisions. We can talk with overseas manufacturers and suppliers and use the same standards when we go overseas, which makes it easier to communicate with them. The company’s internal standards are rough and easy to understand for Japanese people, but it was difficult to be understood overseas. In IPC, each standard was written in detail with pictures and diagrams, making it very easy to understand.

Dr. Mitchell: The manufacturing quality of Japanese companies is so high that even if we introduced IPC, we would not have to make major changes to our processes. For example, during a meeting to determine the quality of a product, we may say, ‘Only the processes listed on pages 8-13 of IPC-A-610 should be processed using the special method we have specified. Otherwise, please proceed with Class 2 of IPC-A-610. If you make a request in this way, you will be able to communicate smoothly and clearly with the partners.

As a result, Advantest has succeeded in adding to its three existing strengths and gaining a strong advantage in the global marketplace.

1. To be able to provide a one-stop solution for all equipment related to semiconductor testing.
2. Must have high speed range measurement technology.
3. High Reliability.

A new addition is the ability to distinguish between in-house production and external production using EMS. The introduction of IPC has further complemented the company’s original strengths and has enabled to explain the details of its business with overseas partners and clients.

What is the importance of the IPC standardization process in the global market?

Mr.Tsukagoshi: PCB Mounting technologies are becoming increasingly difficult, and unless we establish our own soldering and assembly technologies, we will not be able to manufacture our products around the world and meet global demand. We will continue to utilize IPC to increase the number of excellent engineers we have around the world.

Dr. Mitchell:  IPC wants to break down barriers between countries and create a smaller world through standardization. By getting Japanese companies to understand IPC, we can develop new business in the global marketplace.