FCI OEN is one of the leading manufacturers and suppliers of connectors and cable assemblies in India. It is a 100 per cent subsidiary of FCI, which is headquartered in Singapore, and has a strong presence in the Indian telecom and industrial sectors. Rajesh Arakkal, GM, FCI India, shares the company’s journey so far and discuss its growth plans in conversation with Gunjan Piplani of Electronics Bazaar
EB: Being a leading name in the components industry, how is FCI OEN positioned in the Indian connectors’ market?
The Indian connectors market is highly diversified, and each player in the industry has its own domain and market leadership in its focus areas. FCI is the second largest connector company in India, and we have a strong presence across the telecom, industrial and instrumentation segments. We have consistently maintained a growth rate of 20 per cent to 30 per cent for the last couple of years. As far as FCI OEN is concerned, we have a major share in the telecom and industrial segments.
EB: What is your view on the growth prospects for the connectors and cables industry and also for the application industries (like industrial and telecom)?
The connectors and cable assembly market is predominantly dependent on emerging end use applications. The high speed data transfer technologies in telecom are a major milestone for the industry. We are moving swiftly from 2G and 3G to 4G. FCI OEN is very much a part of these advancements. Our highly sophisticated connectors like ExaMAX(R) and AirMax(R), as well as our optic connectors and cable assemblies, play a key role in the rapid evolution of the telecom domain. Industrial connector business will see a major growth in future through technologies like Internet of Things (IoT), energy automation etc. We are a step ahead with our customised solutions for all these applications.
With goverment initiatives like ‘Make in India’ campaign and incentives for electronics industries, we will see major brands in telecom, power, automation, energy management moving to India to start manufacturing units. This will bring tremendous growth opportunities in industrial connectors in future.
EB: What is the unique selling proposition of FCI OEN?
FCI OEN has one of the largest integrated connector manufacturing facilty in India. Our in-house design and engineering division, with its cutting-edge technologies, helps us to offer sophisticated customised solutions for various emerging applications in the telecom and industrial segments. FCI OEN’s quality is well known among the industries, and without compromising on our high quality standards, we offer competitive prices and deliver our products within shorter lead times. This is achieved by involving our employees through various lean and value engineering initiatives.
The journey and the milestones
EB: So far, how has the journey been for your company?
FCI OEN has witnessed several challenges throughout its journey. However, we considered every challenge as an opportunity to improve, and have adapted very quickly. There have been difficult times when the telecom industry was stagnant and the government’s policies were uncertain. But we planned our strategies very cautiously to divesify our product portfolios with industrial customised solutions. As a result we achived more than 20 per cent year-on-year growth in the past few years.
EB: What hurdles did you cross in order to establish your business in India?
We started the business in 1981, and have had our share of ups and downs as a part of the connector and components industry.
One of the major hindrances faced by the connector industry is the five per cent duty levied on the copper content for imported phosphor bronze (PB), which is the major raw material in connector manufacturing. In India, we do not have suppliers who offer a high quality or have the capacity to supply PB. On the other hand, if we import the PB terminals stamped and plated outside India, there is no duty. This is a major anomaly in policy, which hinders the manufacture of connectors and other components in India.
EB: Have there been any failures and what lessons did you learn from the experience?
We went through tough times during the 2G telecom crash in 2010-2011. Most of our business involved telecom customers. After that experience, we moved from standard to customised connectors and now we manufacture customised connectors using our strong engineering capabilities.
EB: What are the achievements of your company? Could you please share what certification the production units hold?
We received the ‘Business Excellence Award’ in 2014 from ELCINA-EFY. We also won the State Quality Circle Award from CII for 2013. Schneider selected us as its best supplier for electronic components during 2014 for cost, quality and delivery performance. We were also ranked among the top three connector companies in India by this very magazine, Electronics Bazaar.
In terms of certification, our plants at Kochi and Bengaluru are ISO 14001 and ISO 9001 certified. The Kochi plant is also ISO TS16949 certified.
EB: What are the strengths of your company?
We have an experience of 30 years and an army of highly skilled employees. We offer superior quality and shorter leadtime, strong engineeering capabilities. With our integrated manufacturing units, we are able to add value to our customer by developing customised and localised products. This helps our customers to reduce imports and engance local content to stay competitive in Indian market.
Business strategy
EB: What sustainability strategy do you apply for your connector business?
We have long term and short term business strategies to sustain and grow our business. We develop products looking at the future trends in the electronics applications like 4G, LTE and beyond, then internet of Things (IoT), LED lighting, instrumentations, automation solutions etc. We apply operational excellence like lean and value enigneering, and people empowerment to sustain our profitability and competitivness.
EB: How do you plan to stay ahead of your competitors?
Our strong customer service and application engineering capability, 30 years of experience, integrated manufacturing under one roof, experienced staff with operational excellence and quality culture as their DNA—all add up to make us the preferred choice. Moreover, with our lean and value engineering practices, we offer the most competitive pricing in the industry.
EB: Can you tell us something about your operating principles?
Our operating principle is ‘Double the good; halve the bad with double speed.’ We strictly follow lean concepts across our operations.
EB: Is there any government initiative that has proved beneficial to your business?
The steps taken by the government to improve domestic manufacturing and to curb the import of various telecom equipment are definitely a welcome sign for Indian manufacturers.
Electronics manufacturing clusters (EMCs), the modified special incentive package scheme (MSIPS), preferential market access (PMA) policies, etc, are certainly a boost for domestic manufacturing. These initiatives will help Indian companies to become more competitive. Also, the ‘Make in India’ initiative announced by Prime Minister Modi will help enhance R&D and product innovations to build a world class electronics manufacturing ecosystem in India.
EB: What are your views or suggestions for your supply chain partners in the electronics industry?
The presence of qualified suppliers is a boon for any industry. We source the raw materials for connectors from both domestic and international players. But for certain raw materials, domestic availability is less. These raw materials should be made available locally or the high import duty on these products needs to be reduced. We have partnered with both domestic and global distributors for a pan-India reach. We are able to meet our customers’ demands within a shorter lead time in any part of India, thanks to our distribution partners and wide sales network.
Infrastructure
EB: What type of infrastructure does FCI OEN have?
We have an integrated manufacturing facility of more than 18,000sqm in Kochi with 31 stamping presses, 30 moulding machines, 14 strands of plating lines that can plate gold and palladium with the highest efficiency, 18 automatic assembly machines, etc.
Our cable assembly and fibre optics facility at Bengaluru is spread across 3000sqm and is also an integrated facility for cable assembly operations. All our machines comply with global standards and are from Bruderer, Fanuc, etc.
EB: What expansion plans do you have?
We are currently expanding our production lines and facilities in Kochi. Understanding the need of the hour, we are investing in technology, people, machines and products. Our Bengaluru facility is also running at full capacity, and we are analysing various expansion possibilities to cater to the increasing demands from our customers.
BOX 1
FCI OEN at a glance
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Incorporated on June 2, 1981
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In 1984, the company commenced its commercial operations
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The company has represented FCI in India since 1985 with 1700 employees
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Produces rack and panel connectors, terminal connectors, flat cable connectors, circular connectors, PCB connectors, heavy duty connectors, IC sockets, etc
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Every financial year, FCI OEN spends two per cent of its average net profit made during the three preceding financial years on corporate social responsibility (CSR) initiatives and projects
BOX 2
The domains FCI OEN serves
Communications:
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Switching / routing / access / transmission
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Wireless base stations / radios and antennas
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Wireless technology premises equipment
Industrial and instrumentation:
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Business and retail equipment
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Industrial control equipment
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Instrumentation and medical
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Power and energy equipment
