|dc.description.abstract||With rapidly changing electronic technology, faster innovation, progressively shorter product life cycles, and market demand increasingly beset with uncertainty, the internationally-renowned big brands have gradually turned to outsourcing for lower value-added and non-core manufacturing, distribution and maintenance, as a means of reducing costs, stimulating consumption, and increasing competitiveness, allowing them to focus on brand marketing, product development and other core competencies. Industrial development up to now has gone through several major reforms, with the production model gradually moving from vertical integration to disintegration. This trend has led to the emergence of the specialist OEM industry, and Taiwan has even been called the “electronic products manufacturing OEM kingdom.”
The biggest difference between EMS (Electronic Manufacturing Services) manufacturers and Taiwan′s earlier OEM (Original Equipment Manufacturer) and ODM (Original Design Manufacturer) manufacturers is that apart from providing customers with proxy production services, EMS manufacturers also actively provide customers with such peripheral services as product design, logistics management, transportation, product maintenance, and materials management. Traditionally, the majority of OEM and ODM companies have played a passive role of providing production services according to customer requirements. As the nature of the service was relatively simple proxy assembly work, many competitors became involved, but they were also relatively easy to replace. EMS vendors, however, are oriented toward providing knowledge and management services, seeking to become a virtual factory for the clients. In addition to brand and marketing businesses, EMS manufacturers can provide a full package of high value-added whip-type services.
In this research, LH Company is chosen as the subject of case study. The study is carried out according to Michael Porter’s Five Forces Model and SWOT analysis to identify the competitive advantages of EMS industry operators, and through (1) analysis of external opportunities and threats, and internal strengths and weaknesses, and (2) formulation of business strategy, exploring in-depth the competitive advantages of EMS companies, and the current status and future development of the electronics industry. The study helps gaining a better understanding of division of labor mode used among the EMS companies. The study found that EMS manufacturers had to improve their existing production process technologies, follow that with adoption of low-cost strategies, and lastly provide customers with final segment sales cooperation, after sales services and suchlike value chain logistic services, in order to bring out diversification, vertical integration, and increased production process capabilities for the EMS industry′s future development. The results of the study can serve as a reference of developing business strategies for the case company as well the other EMS manufacturers.||en_US|