“Our product is service,” says Mark Wolfe, general manager of Phoenix International Corporation of Fargo, N.D. He’s describing the business philosophy that has helped launch one of the most successful electronics systems design and manufacturing firms in the country. What has propelled Phoenix International to the forefront has been constant innovation and expansion of services, which include contract design and manufacturing of electronic hardware and software for OEMs throughout the country.
Three top executives from a leading OEM founded the company in 1987. Currently with facilities in Fargo and Springfield, Ill., the company enjoys a high percentage of repeat business with existing customers while continuing to diversify into new markets. One of the primary engines that has driven Phoenix success is the continued expansion of contract design services. “Our combined facilities have more than 200 engineers in varying areas of expertise,” Wolfe says.
“We typically deal with Fortune 500 companies that have very high expectations of what they want,” he continues. “Our customers generally come to us for access to the broad range of experience and expertise we can provide.” As a part of John Deere’s newly formed Special Technologies Group, Phoenix International is able to expand and enhance its portfolio of hardware and software knowledge. Wolfe continues, “Some customers will ask us to do an entire system design. Other customers have their own internal engineering group and will develop the product on their own, and we may just do the final stages of the project. In either case, we’ll ask customers for up-front reimbursement to cover the Phoenix portion of the costs. That way, we can offer the most attractive unit price because we don’t need to burden the product cost with engineering expenses,” he adds. “We want to complement our customer’s engineering capabilities, not compete with them.”
Exceptional Growth…and Still Growing
“Our background comes from an OEM environment – a strong knowledge base of how electronics and mechanics work together,” Wolfe points out. “We’re not just about designing a single electronic module. We design the entire system to come up with optimum solutions.”
Phoenix International has concentrated on markets that require ruggedized electronic systems. “Almost every circuit board we build goes into a Phoenix-designed enclosure, and ultimately must survive in exposed, extreme environments,” Wolfe explains. “We continue to fine-tuned our ability to design and manufacture ruggedized electronics, which has resulted in exceptional growth, making us an industry leader.”
Examples of current customer markets include diesel engines, on- and off-highway transmissions, mechanized agriculture, heavy construction, industrial welders, on-highway trucks, small engines, skid steer loaders, personnel lifts, diagnostic equipment, material handling and industrial controls. The product base includes a mix of displays, sensors and controls.
Top-line Manufacturing Capabilities
While it excels in giving customers specialized design solutions, Phoenix International also has committed to investing in the best equipment available. Manufacturing capabilities include high speed surface-mount, automated flexible circuit assembly, automated through-hole assembly and robotic equipment which includes conformal coating, soldering, gasketing, and potting machinery. Test equipment, quality assurance, final assembly, up-to-date facilities, product identification, prepping equipment and programmers are also part of the company’s extensive capital investment.
Testing is done according to stringent industry standards, as well as to customer specifications. Testing scenarios include electrical transient, dust chambers, temperature/humidity, electro-static discharge (ESD) and electro-mechanical interference (EMI).
“We provide manufacturing capabilities to our customers that successfully compete with other top electronics manufacturing companies. We annually reinvest in updated manufacturing equipment to upgrade and expand our capabilities,” Wolfe says. “The majority of the time, we’re investing for today as well as for tomorrow. Deere fully supports our ongoing investment for future growth.” Currently experiencing a surge, Phoenix is anticipating continued 30 percent-plus annual growth over the foreseeable future. Roughly 90 percent of the business will involve both designing and producing products for other companies.
“In OEM markets, electronic content of the end products continue to grow. At the same time, electronic manufacturing techniques and equipment are also advancing so rapidly that OEMs are finding they can’t afford to spend resources to do this themselves, and they outsource electronic assembly. These factors are driving 20 percent-plus annual growth in the broad electronic manufacturing services industry.”
While the company primarily does business in North America, 10 percent of its sales are exported to Europe. Combined engineering and manufacturing services will make for an estimated $80 million in sales for 2000. Phoenix International currently employs around 700 people in two locations: three facilities totaling 98,000 square feet in Fargo, and an 86,000-square-foot facility in Springfield.
Not Just a Friend of the OEM
While Phoenix International has worked on honing relationships with industry leaders throughout the United States and Europe, it is also looking for new opportunities on the home front. “We’re currently involved in a cooperative effort with North Dakota State University,” Wolfe says. “The university has just established a technological park and we will be one of their primary tenants. We are building a new 75,000-square-foot facility to house up to 300 technical people, which will also be used as a ‘hands-on’ classroom for college students. It turns into a win-win situation for both parties.”
“We are not just breaking physical ground, we are breaking ground on a whole new enterprise for NDSU to fulfill its mission for this century in economic development,” says Phillip Boudjouk, NDSU vice president for research, creative activities and technological transfer.
Located on 40 acres near the NDSU campus, the park is envisioned as a place where researchers and private industry will combine talents. As the park’s cornerstone tenant, Phoenix International will expand its capabilities while playing an important role in developing new technologies.