Global economics dictate the shape of global business, pushing industries up and down value chains according to factors such as labour costs, production capacities and tax regimes.
As volume electronics manufacturing has vanished from the UK it has been widely thought that, aside from China, it is the lower-cost states in central and eastern Europe that have taken the business. That does not appear to be the case, however, if the experiences of Hatron, one of Poland’s top three PCB manufacturers is anything to go by. Volume outside Asia Pacific seems to be dead.
“The market is not so very good, mostly due to the Far East,” explains Marcin Hajdzinski, Hatron’s sales manager. “Small batches for Germany is a good business.” Eighty per cent of the company’s production consists of two-sided “medium technology” boards.
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Hatron offers prices around 15 per cent less than in the West
but cannot compete with China and Taiwan on volume |
Hajdzinski reckons Krakow-based Hatron offers prices around 15 per cent less than its competitors in the west, but far higher levels of automation in China and Taiwan mean those areas offer at least as big a saving again, for volume orders. As a result offering small volumes, fast prototyping, and flexibility are key selling points for Hatron.
Nearby in the small town of Sucha Beskidzka is contract electronics manufacturer Fideltronik, like Hatron founded - and still owned - by a lone entrepreneur. Fideltronik started out as two people in a garage 20 years ago, and now employs 750. It grew rapidly after the Iron Curtain came down in 1990, capitalising on a boom in IT by supplying UPS devices to support the migration from mainframes to PCs.
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| Fideltronik works with Philips Lighting taking on work that Philips considers too low volume |
It started contract manufacturing work in 1994, producing cash registers for the Polish market. It now counts UK firm Sevcon, which makes control systems for battery-powered vehicles, among its major contracts, many of which have evolved from supplying the Polish operation of large firms. For example, Fideltronik works with Philips Lighting, having initially been contracted to its Polish arm, and takes on work that Philips considers to be too low volume.
What these companies have in common is being founded by a single entrepreneur and, by modern standards, working in relatively low technology markets. Original design work is minimal.
Down the road in the Silesian town of Bielsko Biala, however, is Evatronix, an intellectual property (IP) developer founded in 1990 by two academics. In the nature of its founding it shares the heritage of the first two firms, but by working in the IP market and emerging from a university it is more akin to many modern western firms.
One of the founders, Dr Wojtek Sakowski, who leads the computer science department at the Silesian University of Technology in Gliwice, was an innovator around VHDL technology, designing a graphical front-end and compiler that was sold to EDA firm Aldec in 1995.
Since then, and especially since it knew it would enter the EU, more money has become available to apparently help foster a technology economy in Poland. For example, the country was part of an EU-funded programme called PHARE that was designed to prepare would-be EU nations for membership.
Under a part of that scheme known as Tempus, intended to improve education in central Europe, Sakowski secured funds to work with other European universities to introduce EDA to Poland. Evatronix now has a ready supply of graduate software engineers already versed in its core business.
So far so good, but there are frustrations. For example, the Electronica trade show is not recognised as important for the Polish electronics industry, so no grants are available for companies to attend. “Official [government] declarations are pro-high tech, and pro-export,” says Sakowski. “But Electronica isn’t on the official list. It is crazy not to have it, when you will have a shoemaker exhibition in Ukraine.”
Sakowski says high tech exports need government stimulation, and some new technology development grants are good and applications successful - for example for a multimedia processor project Evatronix is involved in with the University of Poznan.
There is, however, no significant technology transfer operation at Polish universities. Under communism a series of state-run institutes, used to help different industries tackle problems and to develop new processes and technologies. Sakowski says those institutes might have been used to help transfer technologies out of universities into the commercial world, but it did not happen during the 1990s. Sakowski reckons these organisations, or a similar set up, could help significantly to foster Poland’s technology industries.
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As it stands, it seems Poland’s technology innovators are working hard to pioneer a high-tech industry in the country. Irritations such as development grants for innovation being judged on the same basis, whether the application is for “a new glue for shoes” or an IP core must smart somewhat, but they are a fact of life. In the UK in recent years what exactly constitutes 'R&D', for the purposes of determining the level of tax relief available to a firm, has been the subject of discussion.
Still, you have to start somewhere, and Evatronix is committed to developing higher value IP than its existing 8051, USB and interface and communication controllers. With a well-educated workforce (40 per cent of school leavers go on to university) and five large dedicated technical universities, it seems more likely Poland will join the West in coming years, than fight what the UK has found to be a losing battle competing in volume manufacturing.
www.evatronix.pl
www.fideltronik.com.pl
www.hatron.com