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90 SMT007 MAGAZINE I FEBRUARY 2020 Matties: Are you the founder of the company? Ghalili: I am one of the founders. The company celebrated its 25 th year anniversary last year. Matties: Congratulations. So, the culture is based on your values. Ghalili: That's right. Matties: In China, there's a culture that may not be congruent with what you're discussing. Ghalili: Exactly. Again, when I first went to China, I was a general manager of a joint venture company in China running a ceramic chip capacitor, and I've always thought that we need to bring in different companies that bring value to society; I felt that would be an area to begin with. In those days, many of the foreign companies thought, "How can we bring prod- ucts so that we feel confident that our IPs are protected?" Then, we asked, "How can we bring a foreign company that does not abuse the labor force and use them only for their labor to produce a product?" We were able to marry these two concepts together and bring that force into Dalian. Matties: That's good for the region as a model for others as well. We know during Chinese New Year, most companies lose a large or a percentage of employees, and that's a big prob- lem. As you know, it creates an interruption in fabrication services. Ghalili: Exactly. In a discussion with one of our customers, they mentioned that every time after the New Year, they go through completely retraining their employees at their other contract manufacturing site. However, with us, they have worked with the same employees for the past 10 years, so they can continue build- ing on the past experience. Matties: You described it as an EMS company with a front-end engineering strength. Ghalili: Exactly. We have 40% of our employees on the manufacturing floor, and 60% are on the front-end. We have 30–35 R&D engineers involved in the design development phase. Then, you have our quality, supply chain, and other staff, many of them with engineering degrees. We are heavy in the front-end, going into manufacturing. Matties: In manufacturing, one of the highest costs has been around labor, and we've seen labor prices increase in China, so we see a lot more of the digital factory. How are you responding to the digital factory? Ghalili: Our engineering R&D people are starting to implement some of these digital concepts. Our hope is to grow but not necessarily add labor to the operation. In the past 25 years, we've never had a layoff because of lack of work. We want to continue on the same path and not reduce our labor force as we are grow- ing into the digital environment; instead, we want to use the same labor force and move them up the value chain. They're going to perform these higher-end value produc- tion through the constant training we provide to them. M a t t i e s : Yo u r va l u e s t owa rd educaion easily fit with that philos- ophy. Because you're exactly right that you can grow and retain the people that you have, which is great. What's the greatest chal- lenge in your business?

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