Highlights, Insights, and Market Opportunities for the Construction Industry in 2023

2023 is just around the corner, and builders are contending with an uncertain economic forecast in the year ahead. But for all the unanswered questions, 2023 construction industry trend lines are rapidly becoming more clearly defined.

At Pivot International, we are a global, one-source leader in product design, engineering, manufacturing, and supply chain management. Our extensive suite of digital technologies and world-class DFM talent delivers smart construction solutions to help companies capture value from the latest industry development and trends using the latest IoT applications. In this piece, we’ll explore insights drawn from the CBRE’s 2023 US Construction Costs Trends Report to help industry players prepare for the opportunities and challenges that lie ahead.

Market Outlook

• Due to inflation, the war in Ukraine, and a host of other adverse factors, we can expect to see a 14.1 percent year-over-year increase in US construction costs through the end of 2022 with a 2%-4% stabilization expected in early 2023, returning us to historical averages.
• As of this writing, headlines have declared a significant easing of select supply chain stress points. But headlines also reflect choke points and other looming risks, including labor strikes, a shrinking talent pool, an aging workforce, component shortages, and extended lead times.
• Construction demands are expected to hold steady and strong for the near term, though economic uncertainty remains about a possible recession. However, pent-up demand for new construction, historically low housing stocks, and government infrastructure initiatives should help to offset a downturn and boost total construction costs.
• Demand for multi-family housing remains especially strong. The National Multifamily Housing Council estimates a need for 4.3 million new units between now and 2035 to ease the pressure — the shortage of housing is driving up rent, with asking prices rising 12.6% year-over-year through July.
• Smart technologies are shaping the industry landscape, and contractors, engineering firms, and other stakeholders across the value chain are deploying IoT construction solutions to capture value.

Opportunities and Trends

Sustainability

Green initiatives are garnering increasing government support. Between policy changes and government incentives, the construction industry is investing more heavily in green design and energy-saving technology. Integrating modularization and prefabrication (especially using additive manufacturing techniques) into design and build processes drives sustainability and helps firms more easily scale.

The Architecture, Engineering, and Construction (AEC) industry is coming together to devise new methods of reducing construction’s environmental impacts. One of their initiatives includes a concerted effort to recruit greater industry support for committing to using more sustainable building materials. Another initiative involves the widespread use of passive climate control like the HVAC sensor control network our teams at Pivot created that measures indoor temperature and maintains it to preset parameters.

Manufacturing

For commercial buildings, offsite construction is becoming more and more common thanks to prefabrication and modular construction. This trend is driving greater demand for tracking technologies that continuously monitor assets and equipment performance. Smart construction solutions are changing the way that construction managers mind their sites. By attaching IoT sensors to cranes, backhoes, dozers, boom lifts, and articulated trucks, managers receive live data and enjoy high levels of site visibility — even from many miles away. One example of Pivot’s smart construction solutions is this custom control panel created by our subsidiary, MCC Electronics. It features LED indicators and switches with a vinyl overlay and joystick controllers for easy operation in a platform or extended bucket. It was created with the benefit of DFM (Design For Manufacture), a Pivot specialty that seamlessly integrates and optimizes design, engineering, and manufacturing phases of NPD to drive cost savings through scalable production.

Multi-family Housing

There is enormous opportunity in the multi-family housing market, which shows signs of being the most significant growth opportunity segment. Companies that launch building products must develop their product lines with an eye to investor-focused construction. This means rejecting viable use case solutions in favor of optimal use cases, which requires a complex understanding of the end-to-end NPD process and broader ecosystem in which the product will be deployed. When you work with a one-source partner like Pivot International, you’re working with a company whose reputation and strength lie in integrating and optimizing every aspect of the product development process.

Supply chain

With supply chain challenges expected to persist in some fashion for the foreseeable future, industry leaders will remain dependent on supply chain experts who offer out-of-the-box solutions. At Pivot, we bring more than fifty years of experience in seeing clients successfully through economic, climatic, geopolitical, and pandemic-driven disruption. During the last two years, our 320,000 square feet of tri-continental manufacturing capability (including options in the American Midwest) has helped to buffer our clients from some of the worst supply chain shocks. In addition to providing alternative supply chain solutions through our global network, we have successfully hacked a significant percentage of supply chain challenges using engineering workarounds. (Proof that procurement isn’t always the answer to breaking through roadblocks.)

Looking to Scale With a Smart Construction Solution?

Pivot delivers a proven track record of IoT construction solutions to help companies capture value from developing trends and opportunities. If you’d like to learn more about our collaborative approach to doing business and how we can help you scale with the launch of a winning product, contact us today for a no-cost consultation.

The War in Ukraine, America’s Industrial Base, and the Future of Cyber Security — What Companies Need to Know

The war in Ukraine has sparked new debates about the cyber security of America’s industrial base. Few people are more qualified to weigh in on the subject than Josh Steinman, Senior Cyber Policymaker under the Trump administration and now head of Galvanick, a startup revolutionizing the security of industrial control systems. This topic is highly relevant to our clients and us at Pivot International. As a global manufacturer, product development, and supply chain firm with extensive investment in the latest digital technologies, we are committed to delivering the highest possible levels of data security for our clients. We do this with a business model built on integrative coordination and oversight, which ensures seamless alignment across our tri-continental facilities.

In this piece, we’ll provide an executive summary of some of Steinman’s latest thinking to help American companies in the industrial sector better grasp the evolving cybersecurity landscape and what it may mean for their businesses and the broader industrial base.

Hollywood vs. Reality

When discussing cybersecurity, it’s important to separate the Hollywood version of cyber attacks from real life. Prior to the war in Ukraine, many people had movie-like conceptions of what a cyber attack would look like, picturing DEFCON 1 scenarios like a total blackout of the nation’s power grids and missile defense system. But in reality, cyber warfare looks much more like the cyber attacks currently bombarding Ukraine’s industrial infrastructure. It’s worth noting that long before the armed conflict, Russia had been attacking Ukrainian power grids for years. In 2015, a hit on these grids that Wired magazine called “cunning and unprecedented” was unsuccessful since the majority of Ukrainian grids remained analog and relied on manual operation. Ukraine has since digitized many more of its grids, increasing its vulnerability to successful attacks.

The Risk-to-Benefit Costs of Digitization are Concerningly Unclear

Over the last three decades, many public and private US entities invested extensively in digitization. (Converting previously manual processes to digitally automated ones.) As it pertains to America’s fully digitized power grids, Steinman opines that government officials, policymakers, private enterprises, and everyday citizens must sufficiently wrestle with the serious risks accompanying full-scale digitization. Steinman asserts that our thinking has been clouded by models such as McKinsey’s 5 nines of uptime optimization culture. (“5 nines uptime” refers to the practice of keeping a system fully operational 99.999% of the time — an average of fewer than 6 minutes of downtime per year.) These models, Steinman says, fuel economic growth in the short term but — in the bigger picture — leave the US alarmingly exposed by trading predictable downtimes for unpredictable downtimes.

Steinman contends that by looking at digitization from an overly narrow perspective that is more concerned with short-term ROI than long-term hazards, we are laying the groundwork for Black Swan events that can have catastrophic effects on industrial assets and the broader society. Scenarios of this type are not without precedent. Globalization is a prime example of how the decisions driven by financialization and financial optimization have had strategic, long-term impacts on US populations, destroying once prosperous cities and bifurcating the middle class. But unlike traditional outsourcing, the quest for full-scale digitization poses more serious risks than any seen before.

Effective Policy Changes are Unlikely

The efforts of leaders who are cognizant of the security risks of digitization and seek to lead policy changes that better protect America’s industrial base are largely unsuccessful. This is due partly to the financial incentives discussed above. Still, Steinman says the more significant challenge is that we are trying to solve digital-age challenges using industrial-era structures that characterize the workings of Washington. In other words, while government agencies are well-equipped to solve what the managerial literature refers to as technical challenges, they are structurally incapable of successfully tackling higher-order adaptive challenges for which technical solutions are no match. (Cyber challenges fall into the latter category.)

Defending America’s Industrial Base

Given the long view, cyber security is barely out of its infancy. To date, no umbrella technology has pulled together disparate data streams of industrial infrastructure and then correlated them to identify suspicious cyber activity. Instead, most of the great cyber security companies that already exist deal only with single data streams. For example, these companies can alert clients about a firewall hit by an IP address previously associated with a Russian GRU. But what they can’t do is register a threat of this type and triangulate it with activity in a company’s work orders, change management system, and actual endpoints. If there were, companies and other entities could immediately recognize suspicious activity and better mobilize to protect industrial infrastructures. Steinman believes that multi-data stream monitoring and analytics represent the future of cyber security. This, he says, is America’s best defense for protecting its industrial base, and it’s where he’s putting all his energy.

How Companies in the Industrial Sector Can Protect Themselves

While Steinman plans to lead the charge toward protecting America’s industrial base from cyber-attacks, manufacturers need to redouble their efforts to defend themselves using these four data security best practices:

• Be wary of phishing — bad actors’ preferred form of cyber attack. This means looking for emails or popups requesting credit card numbers or security credentials. (Use apps to protect yourself since they are far less vulnerable to compromise.)
• Align users, tech stacks, and facilities under integrative IT infrastructure.
• Ensure the policy measure are uniformly enforced. Integrative IT will only matter if policy measures fall through the cracks.
• Judiciously invest in digital transformation with a focus on cloud-native proxy-based architecture. Inspect every user across all traffic to reduce threats in SSL traffic. Quarantine suspicious activity to prevent malware installation and store it for further analysis.

Looking for Trusted Manufacturing Partner?

With over 50 years of proven experience, and 320,000 square feet of scalable manufacturing capability across three continents (including three domestic options in the American Midwest), we are a trusted production partner to companies worldwide. If you’d like to learn more about our services, how we protect your data, and how we can help you launch a successful product, contact us today!

Digital Trends Rewriting the Playbook for the Sports and Entertainment Market

The sports and entertainment market is undergoing significant change spurred on by the global pandemic, accelerating trends in digital adoption, and shifting cultural attitudes and behaviors. These changes include infusions of capital from new sources, a post-pandemic resurgence of spectator and participatory sports, balancing the books for college athletes, and a greater reliance on emerging and connected technologies. Together, these changes have the potential to redistribute power within the sports and entertainment market and create new pathways for unprecedented growth.

At Pivot International, we are a US-based global leader in helping companies capture value from emerging trends in sports and entertainment. With end-to-end services that span proof-of-concept, design and engineering, scalable manufacture, and distribution, we provide a secure, seamless, integrative development process and advanced product solutions for your innovation.    

Sports and Entertainment Opportunity Segments

By surveying the sports and entertainment market landscape to better track and understand emerging changes and trends, businesses can more easily engineer new opportunities for capturing value from segments that include: 

• Spectator and participatory sports organizations and leagues
• Sports players and fan
• Fitness and recreational centers
• Fitness enthusiasts
• Gamers, hobbyists, and other everyday consumers

Sports and Entertainment by the Numbers

The sports market can be divided into two overarching categories: participatory sports and spectator sports. Market reports and growth forecasts indicate that while participatory sports accounted for the largest segment at 72.1% of total growth in 2020, spectator sports are predicted to be the fastest growing segment at a CAGR of 11.1%, representing a gain of $136.7 billion of global annual sales by 2025.

The fitness and recreational centers market is the largest sub-segment of the participatory sports market, accounting for 39.9% of the total in 2020, with an expected CAGR of 10.9% between 2020-2025.

The entertainment market comprises a wide array of segments, with gaming representing a functional cross-over with sports. This sector is set to grow by USD 125.65 billion, progressing at a CAGR of 12% from 2020 to 2025. 

Related to the gaming segment is the radio-controlled (RC) market that includes RC hobbyist vehicles. This market is expected to reach US$ 1761.3 million by the end of 2027, with a CAGR of 3.1% between 2021-2027.

Digitalization — The Top Trend in Sports and Entertainment 

Digitalization continues to exert strong adaptive pressures on the sports and entertainment landscape. Sensors, IoT, augmented reality (AR), virtual reality (VR), data capture, and analytics are playing increasingly prominent roles in applications for these markets. 

Thanks to the low-latency benefits of 5G, these digital, wireless, and cellular applications are picking up speed and rewriting the playbook for the sports and entertainment market. Applications include training, simulations, broadcasting, in-venue experiences, viewer-customization, and more. In short, companies are mobilizing to launch products that give customers the best of both physical and digital worlds while translating the energy and excitement of in-person events to digital experiences.  

At Pivot, we deliver advanced AR, VR, sensor, and IoT expertise and deploy a diverse suite of digital product solutions, including Wi-fi 6, 5G, Bluetooth, LoRa, NB-IoT, Cat-M1, and more. These technologies are integral to the many sports and entertainment innovations we’ve developed, including fitness monitors, a contactless game controller, an indoor sports camera, and many other successful products. 

Seizing Adjacent Opportunites

As companies seek to capitalize on digital evolution in the sports and entertainment space, they’ll need to wrestle with questions of utility vs. entertainment value. They’ll also need to examine how these technologies and their application stand to open adjacent market opportunities.

For example, Castle Creations, one of Pivot’s nine subsidiaries, first began doing business 25 years ago in the RC hobby sector. But as Castle developed its reputation for creating high-performance motors that rivaled those found in almost any other sector, it saw — and seized — the opportunity to become the go-to partner for industrial and commercial applications. Today, Castle has distinguished itself as the leading aftermarket specialist in low-weight, high-power, configurable ESC solutions, DC brushless motors, customized firmware, and high-performance fuel systems. 

Looking to Launch a Successful Innovation?

If your company is gearing up to launch a new sports or entertainment innovation, Pivot brings 50 years of proven experience, in-house DFM (Design For Manufacture), and 320,000 square feet of manufacturing space (including options in the American Midwest). We will work closely with your team to understand your business objectives and make your product vision a winning reality. If you’d like to learn more about how we can support your business, contact us today. 

The New Sales Ecosystem: How to Unlock the Potential of Your Partner Relationships

When it comes to partner relationships, company leaders tend to turn their attention to “sexier” topics (like how digital adoption can drive operational efficiencies, for example) or regard the subject as the province of traditional reseller relationships. This is a mistake. For centuries, sales partnerships have been the crux of commerce. And over the coming decade, the reinvention of these alliances will prove as indispensable to business growth as digital adoption.

At Pivot International, we are a global one-source leader who believes that looking at partnership relationships through an ecological lens is critical to the success of companies’ go-to-market strategies. Pivot’s partnerships — internal and external — are central to its 50 years of experience in helping companies deliver successful innovations. With DFM expertise that spans fourteen industries, six markets, and three continents, our investment in partner ecosystems is as integral to our clients’ success as our own.

Unlocking the Power and Potential of Partner Relationships

To unlock the power and potential of partner relationships, companies can benefit from surveying and assessing the value of their partner ecosystem using the following five steps.

Start Fresh

The terms of engagement for sales have never undergone such rapid evolution. Companies must be willing and able to innovate their approach to operational design, talent acquisition, and digital engagement. Step back and take a fresh look at your business model and organizational practices to determine the degree to which they allow you to capitalize on partner relationships. Reevaluate your near-term targets in the context of this new perspective and identify opportunities for strategic shifts.

Go big, or go home

One of the reasons the subject of partner relationships can seem unnecessarily staid is that many leaders aren’t thinking big enough and associate them strictly with traditional channels. But non-traditional channels like social media (and social media influencers), crowdsourcing, event marketing, and other unconventional approaches are playing an increasingly important role in many markets. And remember, when expanding your reach through digital channels, the whole point is to enrich rather than replace human interaction.

Map interrelationships

Undervaluing the critical importance of partner relationships often has a lot to do with failing to understand the connections between your company’s and your competitors’ relationships with various partners. It can be an incredibly productive exercise to map these relationships, question implicit assumptions about them, and understand their long-term implications. Clearly define metrics for what constitutes a successful partner relationship.

Match to market

Albert Einstein was famous for saying that all living things are intelligent in their own way. This insight is summed up in the quote often attributed to him: “If you judge a fish by its ability to ride a bicycle, you’ll think it’s stupid.” The point here is when things aren’t seen in their proper context, it’s easy to overlook or dismiss their value. To properly assess your partner relationships, match them to the economic framework most appropriate to maximizing their value.

Don’t Discriminate

The “customer first” approach to doing business begs the question of the health of the broader ecosystem in which both your customer and company operate. When companies get too focused on the customer at the expense of their partner relationships, both suffer. In other words, don’t discriminate too sharply between your customer and partnership investments since each play a critical role in supporting the other. This means providing your partners with the same attention, investment, transparency, and access you provide to your customers.

A Shared Path to Success

Sales leaders are standing at a crossroads where they face the path of obsolescence or the path of unprecedented opportunity. Those who take the latter will forge a shared path to success for sales teams, customers, partners, and shareholders. At Pivot, this win-win approach is part and parcel of our one-source business model and company culture. If you’d like to learn more about how we will work closely with your team to help you deliver a successful innovation to market, contact us today.

Beware the Costs of Confusing Technical and Adaptive Challenges

According to world-renowned leadership expert Ron Heifetz, the chief obstacle to successful innovation is companies’ lack of clarity about the difference between technical and adaptive challenges. And when developing a new product, he says, knowing the difference from the earliest point in the process is essential.  

At Pivot International, we are a one-source global leader in helping companies design, develop, manufacture, and distribute innovative, award-winning products. We bring a half-century of experience in solving complex adaptive challenges with expertise across fourteen industries and six markets. Through advanced supply chain solutions, in-house DFM, innovative engineering hacks, extensive domestic and global manufacturing options, or the application of the latest digital technologies, we are a premier partner to companies worldwide.  

Why is it so important to work with a partner experienced in differentiating technical from adaptive challenges? Because the latter can never be successfully solved with the former. When adaptive challenges are mistaken for technical ones, failure is the inevitable result.     

Technical vs. Adaptive Challenges

When companies set out to solve a problem that can be easily defined, has a clear solution, and can be linearly executed, they’re dealing with a technical challenge. But when they attempt to tackle a problem that is difficult to identify, lacks a concrete solution, and involves complexities of execution, they’re facing an adaptive challenge. 

Technical and adaptive challenges exhibit other key differences: 

• Are limited to single variables vs. being systemic in nature 
• Solutions are “plug and play” vs. requiring a series of controlled “fail forwards”
• Can be solved by an outside authority and implemented by edict vs. requiring stakeholder collaboration and concerted effort between all parties

When working with corporate leaders, Heifetz often uses a medical example to illustrate the difference between these challenges. 

Discovering that you need open-heart surgery, Heifetz explains, is a technical challenge. The problem can be clearly defined, solved by an outside authority (a cardiac surgeon), and executed in a reasonably straightforward, predetermined manner. 

On the other hand, recovering from open-heart surgery is an adaptive challenge. The precise course and timing of your recovery are ultimately uncertain and will require a fundamental change in mindset and experimentation with lifestyle changes. And the burden of making these changes will fall not to an outside authority but to you and those closest to you.

Now that we’ve used these real-life examples as conceptual anchors, let’s look at how they factor into NPD. 

Complex Products = Adaptive Challenges

By definition, the development of simple products falls into the category of a technical challenge. But the development of complex products — especially those intended for medical and industrial markets — represents a mix of technical and adaptive challenges. And to successfully solve them, your partner will need to bring three qualifications. 

A Complex-Systems Approach

Because the adaptive challenges of complex products are systemic, successful NPD requires an approach that looks holistically at the broader process, market landscape, supply chain risks, and more. 

Only a partner with an end-to-end, integrative approach is equipped to successfully tackle this challenge, and DFM plays a critical role in this capacity. Pivot’s DFM expertise takes its seamless one-source model one step further by commencing the design phase with supply chain and manufacturing considerations in mind. This guards against the sunk costs that are all too common with linear approaches and ensures cost-effective, scalable production.  

Iterative Prototyping Expertise 

Adaptive challenges can’t be solved with plug-and-play solutions. Instead, they require processes specifically designed to help stakeholders question assumptions, redefine the problem space, experiment with and test potential solutions, and glean valuable feedback for feed-forward into another round of controlled “fail forwards.” This process is the essence of iterative prototyping, and as any innovation expert will attest, no adaptive challenge can be solved without it. 

At Pivot, iterative prototyping — and a general orientation toward extensive experimentation and discovery — has become a business imperative in the face of escalating supply chain disruption, parts-and-components shortages, and geopolitical strife. For instance, we’ve found that a significant percentage of supply chain shortages can be overcome using this approach.

Often, through a series of experiments, we can reconfigure product design and engineering parameters to accommodate alternative parts and components. This allows NPD to move forward without getting stopped in its tracks with dependency on an item that is currently unavailable or extremely expensive to procure. In times like these, this can make the difference between our customers staying in business or folding under intense market pressures. 

A Commitment to Collaboration

As we explained earlier, technical challenges can be solved by an outside authority. Conversely, adaptive challenges in NPD require stakeholder collaboration and a concerted effort to achieve a successful launch. Moreover, technical changes can be made by edict, whereas adaptive challenges can be implemented only through consensus. 

This is why a commitment to collaboration is central to Pivot’s company ethos. We’ve gone to great lengths to create organizational processes and infrastructure that enable us to work closely and synergistically with our clients throughout the process. This ensures we deeply understand their business objectives, company values, target market, unique challenges, and more.

If you’re gearing up to launch a complex product, you’ll need a partner experienced in successfully solving technical and adaptive challenges alike. If you’d like to learn more about how Pivot can make your product vision a winning reality, contact us today. 

Four Post-Pandemic Trends to Watch: Manufacturing, Machine Learning, Sporting Goods, and Medtech

These days, it can seem as though every other headline or news report has something to do with the global pandemic or its after-effects. With so much COVID-related content flooding the media-sphere, it can sometimes feel like listening to a song stuck on endless repeat. The result? It can be tempting to assume you’ve already heard all the relevant information or to tune out entirely.

While this is perfectly natural, it’s precisely the wrong time to stop paying attention. Why? Because in the wake of something as world-changing as the global pandemic, it takes time for insights to distill and trend lines to form. And it’s precisely these late-breaking insights and trend lines that are most worth waiting for. This article will examine four post-pandemic trends that companies should be paying attention to.

Domestic Manufacturing Has the Potential to Rebalance the Books

Decades of offshoring have wreaked havoc with US supply chain and labor markets. The practice has created massive inequities across sectors and geographies, causing once-prosperous towns to go bust and mid-wage job opportunities to dry up. This, in turn, has contributed to a highly polarized labor market and political landscape that weakens the US economy and global position.

But according to research by McKinsey & Co., domestic manufacturing can play a central role in rebalancing the books by fueling sustainable, inclusive growth, addressing pervasive supply chain issues, and driving global competitiveness. At Pivot International, our 320,000 square feet of global manufacturing capacity (including three locations in the heart of the American Midwest) helps companies and local communities strike a new, more sustainable balance between the benefits of offshoring and domestic manufacturing. With nearly a half-century of experience in supply chain solutions and advanced NPD expertise across fourteen industries and six markets, our teams will work closely with yours to defy disruption and turn your product vision into a profitable reality.

Machine-Intelligence Technologies Can Make an Industry-Leading Difference

Companies in the industrial and manufacturing sectors that leverage machine learning are the clear winners across multiple KPIs. These include efficiency, cost, revenue, responsiveness, customer experience, and environmental impact. The result is that companies that have taken digital evolution seriously are 3-4x more likely to lead the market than those slower to adapt. At Pivot, we deploy the power of Industry X.0, combining state-of-the-art digital technologies to deliver industry-leading outcomes for our clients.

Players in the Sporting Goods Market Needs to Adapt Their Business Models

Companies need to be tracking five trends: digital evolution, an increased emphasis on sustainability, better integration between social media and commerce, the restructuring of distribution channels, and innovative supply chain strategies. While these trends may seem like old news, they’ve become imperative for competing in a post-pandemic market. (Which means that many players in the space will need to adapt their business models.) The success of Digital Concepts Inc., a global leader in the high-end sports and fitness industry (and one of Pivot’s nine subsidiaries), owes much of its success to its ability to foresee the five trends covered here and adapt accordingly.

Healthcare is Coming Home as Delivery Models are Revolutionized

Research indicates that as much as $265 billion worth of care services could shift from clinical settings to home delivery. Research also reveals that Generation Z members face unprecedented behavioral-health challenges, implying the need for new healthcare models and resources for supporting them.

The implications here are that home-delivered healthcare and the medtech that enable it may be a revolutionary answer to the shifting needs of the global populace while creating value across a vast network of stakeholders. Among Pivot’s most celebrated and influential products are the medtech innovations we’ve developed. The Peek Retina, for example, recipient of a European Design Award for Best Design for Humanity, is a smartphone-compatible ophthalmoscope that brings vision care to those in 3rd world countries. And on the behavioral health front, Pivot’s creation of a Patient Prescription Adherence device is helping to end the opioid crisis right here at home.

As we continue to make collective sense of a post-pandemic world and marketplace, new insights will emerge and new trend lines will continue to form. Companies that continue to pay attention, separating signal from noise, will stand a far better chance of successfully competing on the global stage.

If you’re looking for an industry-leading supply chain, NPD, and manufacturing partner, Pivot is the answer. Our in-house DFM expertise, company-owned facilities, flexible manufacturing options, and highly collaborative approach will take your product through a seamless NPD process and successful launch. If you’d like to learn more about how we can support your business, contact us today.

Four Areas You Need to Assess When Vetting a New Supplier

With pandemic-driven supply chain disruption has come new challenges, including component shortages, regulatory changes, skills-gaps, the need for cost-effective alternatives to China-based manufacturing, and more.

Finding a proven supply partner in even the best of times can be daunting. But in the current climate, it can feel for many companies like a game of musical chairs. The good news is that there are more “chairs” than might first be apparent, provided you know what to look for.

Here are four areas you’ll need to assess to help your company find an experienced, cost-effective supplier who can ensure you’re not the one left standing.

Certifications

A reputable supplier will have certifications that ensure they’ve achieved the standards necessary for ensuring strict quality control and regulatory adherence. While standards for consumer products are relatively lax, those for industrial and medical are necessarily highly rigorous.

At Pivot, because our one-source product design, development, and manufacturing expertise spans over six markets and across more than fourteen industries, we bring FDA-registration and multiple ISE and ISO certifications, including ISO 9001:2015, ISO 13485:2016, ISO 80079-34, and IEC 60601-1.

Financial Stability

As many as 50% of all buyers have partnered with a supplier that went out of business, and it seems safe to say that in lieu of the global pandemic, this figure will only rise. One way to gauge financial stability is to determine if your partner is experiencing stable growth, especially in conditions of adversity. If a company can continue to grow in the face of tremendous odds, the chances are that they can help you do the same.

At Pivot, we continue to scale rapidly to serve customers worldwide. Since 2016, we’ve achieved an annual growth rate of 141%. We’ve expanded our talent pool from 136 to nearly 700 and added eight new businesses to our family of companies. In the last few months alone, we’ve been featured on the Inc. 5000, a list of the fastest-growing companies in the country, as well being in the top 1% of the fastest-growing companies in our hometown of Kansas City.

Vulnerability to Geopolitical Risk

Both state-sponsored actions (think, policy and regulatory changes born of trade-tensions with China), as well as “black swan” events like COVID-19, have made companies increasingly aware of the need to assess geopolitical risk when vetting a new supplier.

When evaluating a potential supplier in the context of geopolitical risk, you’ll need to look for three things. First, access to a global sourcing network and manufacturing alternatives to China-based production to surmount supply chain disruption. Second, company-owned facilities to guard against the potentially destabilizing effects of an acquisition or hostile takeover. Three, in-house talent for closing skills-gaps that are being generated by the trend for reshoring or near-shoring.

Agility and Scalability

Many companies are currently facing highly unpredictable demand curves. These curves bring considerable risk as well as significant market opportunities. To seize them, companies need supply chain partners with the agility to rapidly adapt to fluctuating demand and scale production volume accordingly.

Pivot helps companies capitalize on unpredictable demand curves through agile processes, advanced technology (including SMT, AI, 3D printing), and 200,000 square feet of manufacturing across three continents to serve the US, Asia, and European markets.

If you’re looking for a proven supply chain partner, we can help. With nearly 50 years of experience helping companies bring competitive products to market, we deliver the one-source solutions that can help you successfully scale. Contact us today to learn more about how we can help you move profitably forward.

Key Challenges to Building a Resilient Business and How to Overcome Them

Entrepreneurs and enterprise-level executives alike always attempt to build a resilient business that is robust enough to withstand unexpected storms. For example, contingency planning is hardly a novel concept, and many leadership teams of companies large and small engage in this critical activity. But the unprecedented nature and speed, scope, and scale of COVID-19 has brought new urgency to the quest for resilience.

At Pivot International, we bring nearly a half-century of expertise in product design, development, engineering, manufacturing, and supply chain solutions. Throughout our history, we’ve guided our partners through industry changes, economic ups and downs, and multiple waves of disruption. In the face of a global pandemic, we’ve continued to achieve explosive growth and drive our partners’ success across over 14 industries and multiple continents. With this in mind, let’s explore some of the key challenges to building resilience and five steps for creating it in your organization.

Identifying Challenges to Building a Resilient Business

Many leaders are using approaches or bringing assumptions to the table that make it challenging for them to build the resilience they’re seeking. First, we’ll identify four of the most common challenges, and then take a look at how leaders can overcome them.

Overly Concrete Metrics

Companies typically have an excessively concrete approach to measuring resilience. (If they attempt to measure it at all.) In the quest to maximize shareholder value, only easily quantifiable material risks are typically factored in equations of resilience. The failure to conceive of resilience in strictly objective terms holds significant danger.

Short-sightedness

Companies and shareholders tend to fixate on short-term gain at the expense of long-term resilience. Building a resilient business isn’t just about a shift from a short to long-term view. It’s about understanding the relationships between multiple time-horizons and how to optimize for return while remaining agile enough to quickly adapt to rapidly changing scenarios.

Linear, Static Thinking

Company leaders often focus on executing static plans within what is assumed to be a relatively linear and predictable environment. But disruption, by definition, is not linear, stable, clear, or, perhaps above all, predictable. Resilience requires non-linear thinking and an aptitude for working productively with instability and unclear causal relationships (complex systems). To defend against novel threats and act on emerging opportunities, leaders cannot rely on traditional planning and instead must learn in real-time and adapt accordingly.

The Illusion of Independence

Companies tend to view themselves as independent entities rather than interdependent actors that emerge from a larger socio-cultural, techno-economic, and geopolitical ecosystem. The crisis of COVID-19 has served to unmask this illusion, demanding that leaders come to terms with the extent of their dependence on supply chains, customers, and market trends. Resilience, in other words, can never be built in a vacuum.

Overcoming Challenges to Building Resilience: Mining Clarity From Confusion

When the challenges we just explored are not questioned, they prevent businesses from building resilience. But when these assumptions are questioned, they can become sources of guidance for achieving this critical task. In this way, leaders can mine clarity from the very challenges they’re trying to overcome to gain the following insights into new approaches for moving successfully forward.

Identify and Question your Assumption Sets

This is the central competency upon which all resilience depends. Leaders must make the shift from looking through a particular assumption to looking at it. Only in this way can they expose it to questioning and unlock its hidden guidance.

Rethink what resilience means and design new metrics

Resilience cannot be easily quantified, and leaders must look beyond concrete variables when assessing and building it. Understand that resilience has as much to do with a leader’s cognitive-emotional “operating system” and appetite for innovation as it does their ability to quantify objective risks. Design metrics that do equal justice to both.

Play the Long Game

Be unwilling to sacrifice short-term gain for long-term resilience. A fixation on efficiency at the expense of agility and adaptability means your business can succeed only in a fairly predictable market landscape. As many companies have recently learned, it’s not worth the gamble.

Learn to Learn — in Real-Time

As the businessman and futurist, Alvin Toffler said, “The illiterate of the 21st century will not be those who cannot read and write, but those who cannot learn, unlearn, and relearn.” Upgrade your ability to take a complex systems perspective and learn from the unfolding situation itself, rather than assuming you can come to the table with pre-fabricated solutions.

Contend with the Reality of Interdependence

No business is an island, but the insistence on behaving as if this were the case is hazardous to your company’s health. Account for and map the complex network of dynamic interdependencies (the larger ecosystem) that constitutes your business. The sooner you and your team can contend with this reality, the sooner you’ll be able to think adequately about building resilience.

If you’re seeking to build a more resilient business, Pivot International is the partner you’ve been looking for. Our one-source business model helps companies worldwide defy disruption, identify and seize emerging opportunities, and bring innovative products to market. Contact us today for a free consultation to learn more about how a partnership with Pivot can help your company grow in challenging times and scale for a new future.

How to Map and Manage Risk to Safeguard Procurement

Risk is intrinsic to doing business. No part of an organization or phase of product development is ultimately free from threat, and much of a company’s success and long-term market viability depends on its ability to map and manage risk.

At Pivot International, we’ve built safeguards into every phase of the product development process to protect against threats and successfully bring our client’s products to market. Some of the measures we take to manage risk include:

• Utilizing SMT technology to ensure accurate execution of high-volume production 
• Operating company-owned facilities worldwide to ensure complete transparency and oversight
• Leveraging consolidated supply chain systems to withstand climatic, currency, and geopolitical disruptions

Successful risk management requires a host of competencies, including a systemic view of a company’s operations and complex scenario/contingency planning. But common to all threat-reduction efforts are five key strategies that companies can deploy to map and effectively manage risk. Here’s how to implement these strategies to protect your business.

1. Identify

Risk reduction begins with taking account of potential threats to a project. It is helpful to distinguish between risks that are internal to the organization (such as a lack of formal processes or losing a key team member) and risks that are external to it (such as an electronics component shortage or tariff legislation that poses supply chain challenges). At this stage, it’s essential to take a thorough accounting of all risks, however small, and record them in a risk register. Only later in the process may risks that initially seem minor or remote be revealed to be serious threats.

2. Analyze

Once identified, each risk needs to be analyzed along two lines: First, by how likely it is to occur. Second, by the degree of damage it could cause. The first line runs the range of extremely unlikely, probable, imminent, and inevitable. The second line runs the spectrum from negligible, marginal, moderate, significant, critical, and catastrophic.

3. Rate

Use a risk matrix to multiply the likelihood of a threat’s occurrence by the degree of its potential damage to generate an overall risk score. Keep in mind that risk can be conceived of and assessed in more or less granular ways and that risk matrixes can be created to suit your needs. The more simple a project, the fewer risks it will face, and streamlined matrixes are generally sufficient for planning purposes. Complex projects, on the other hand, are inherently more vulnerable and will necessitate complex matrixes for reliably rating risk.

4. Reduce

The whole point of managing risk through identification, analysis, and rating is to provide the raw data necessary for reducing this risk through strategic scenario/contingency planning. It’s imperative to involve all key stakeholders in this phase and to delineate roles and responsibilities in the event the risk becomes a reality.

5. Monitor

The likelihood of a risk occurring and the degree of damage it can cause are ever-changing and should be continually monitored. Today’s security may turn out to be tomorrow’s threat, and risk-assessment measures should be routinely undertaken. No risk register is set in stone, and a comprehensive monitoring plan is essential to ensure it remains up-to-date.

Why Risk Management is Necessary for Procurement

Now that we’ve outlined key strategies for mapping and managing risk, let’s consider specific risks that arise in procurement and how to mitigate them.

Risk management should be an essential part of any procurement strategy. While strategic sourcing and buying help to mitigate many high-profile issues, there’s a significant risk of experiencing unexpected price hikes from suppliers under long-term contracts in both direct and indirect sourcing.

A PESTLE (Political, Economic, Sociological, Technological, Legal, and Environmental) analysis for a specific market or industry can be helpful to run. It serves to highlight risks that could affect an organization from the outside, and in turn, impact pricing or lead to scenarios where suppliers might need to raise prices during the life of a contract.

Mitigating Risk

Regardless of the relationship that companies have with suppliers, price increases can still be challenged, and justification for any increases can be requested. Additionally, in line with the Consumer Price Index, companies can choose to limit price increases. To prevent the percentage from being indiscriminately applied, a transparent cost breakdown should be provided.

At Pivot, we’ve been forging strategic partnerships with businesses of all sizes for nearly 50 years. Our partners trust in our expertise and rely on us to help guide them through all aspects of the product development process, including risk management in procurement. If you’d like to learn more about the winning difference Pivot can make to your business, contact us to set up a free consultation with our team.

Top Products from CES 2020: Choosing the Right EMS Partner

The annual Consumer Electronics Show (CES) is arguably the world’s largest and most popular event for displaying the latest and greatest consumer tech innovations. With thousands of companies exhibiting their products and attendance topping 100,000, tech-industry insiders and consumers alike look to this extravaganza of innovation to identify, predict, and shape emerging trends.

As a leading single-source electronics manufacturing services (EMS) partner with state-of-the-art surface mount technology (SMT), we at Pivot International are behind some of the most innovative trends for the consumer market. Every year we watch with pride as our clients attend CES to showcase the innovations we’ve partnered with them to bring to market.

Top trends and popular products of CES 2020 proved to be those that delivered human-centric care through applications in artificial intelligence, virtual reality, and robotics. Below is a list of our favorites, including a product we played a central role in developing that garnered a prestigious CES Innovation Award.

Jabra Elite Active 75t

Touted as the best-fitting high-performance earbuds, the Jabra Elite Active 75t is designed for an active lifestyle. In addition to providing the best sound quality around, these earbuds are waterproof, sweat-proof, and even come with a customizable equalizer.

4moms mamaRoo Sleep Bassinet

The 4moms mamaRoo sleep bassinet follows the American Academy of Pediatrics’s safe sleep guidelines and has five unique rocking, swaying, or vibrating motions. It also features four white noise options and the ability to set timers on your phone.

Phyn Smart Water Assistant

The Phyn Smart Water Assistant is a self-installed water monitor that goes under a single sink. It provides detailed insights into how each fixture in your home uses water and notifies you if a leak is detected anywhere in your home.

Segway Ninebot T60

Segway’s new kick scooter, the Ninebot T60, is the first truly robotic scooter we’ve seen. It’s intended for use in scooter-share programs and has Segway’s self-balancing tech that can correct for bumps and make the ride more stable. What’s new about this version is the fact that users can summon it with an app. Rideshare companies can even ghost-drive multiple scooters at once to nearby charging stations.

OrCam Hear

A product that could have a transformative impact for people with hearing loss, OrCam Hear is a hearing aid device worn around the neck that uses cameras and onboard machine intelligence to determine which person in a crowded room is speaking to the user. The ability to identify a single voice helps solve a common issue with traditional hearing aids in which users struggle to differentiate a distinct speaking voice from background noise or other conversations.

Zibrio SmartScale

Winner of both a CES Innovation Award and theAARP Pitch Competition Award, the Zibrio SmartScale assesses the fall-risk of seniors and other at-risk users. Developed in partnership with Pivot and Zibrio, Inc., the device offers personalized, clinically-proven recommendations for lifestyle modifications and exercises for improving balance.

Whether it’s comfortable earbuds for those who live active lifestyles or a scale that can prevent fall-related injury or death, these popular products from CES 2020 all share one thing in common: impeccable design.

If you’re looking to create a winning digital device or electronic product, it’s essential to work with an EMS partner that brings:

• Extensive experience in electronics manufacturing
• The ability to work collaboratively with you and your team, whether that means establishing proof-of-concept or iterating your most recent prototype
• Technologically advanced systems, like SMT
• Expertise in regulatory compliance and the ability to guide you through the process
• Solid practices for quality assurance and quality control
• A global supply chain management network 

At Pivot, we have more than 47 years of experience in single-source product design, development, manufacturing, supply chain management, and SMT for hundreds of businesses worldwide. Our electronic engineering and manufacturing technicians adhere to IPC standards, making sure your electronics are dependable, and our international electronic manufacturing services ship products around the world that meet CE, UL, and FCC requirements. Additionally, our RoHS-compliant assembly process is standard with every assembly.

Contact us today!