VP of Manufacturing Kurt Jensen sees opportunities for contract manufacturing electronic products that are at once complex and in limited volumes.
After spinning out of the Utah State University’s Centers of Excellence program in the mid-1990s, VPI Technology wasted no time making a mark: The company designed a market-first CMOS imager for Lego’s Mindstorms series as a startup.
“The opportunity came up and we cut our teeth on it,” says Jensen. “We were the first company to integrate a CMOS imager into a commercial product, so we became experts in that field, so that was a launching board in that area.”
VPI Technology subsequently focused on product development and design for its first 20 years. “When I came on, we had just started dabbling in manufacturing,” says Jensen, who joined VPI in 2007. “Since then, I have taken manufacturing international as well as built out our domestic.”
About 30 of the company’s 100 employees now work in manufacturing one of four VPI divisions along with engineering, certification labs, and a radiation detection equipment brand in D-Tect Systems.
The company also has more than 40 engineers on staff and Jensen describes a nice synergy with manufacturing employees: “A few of our employees are aspiring engineers, and this helps them get their hands dirty before they start their degree.”
In Draper, VPI manufactures D-Tect products while also working with contract manufacturing clients in medical, avionics, automotive, security systems, and other areas. The company can handle orders of up to about 5,000 annual units in-house at a company-owned 25,000-square-foot facility, but it can move higher-volume orders to partners in the Philippines.
“In our domestic manufacturing facility, we really specialize in complex assemblies in lower-volume runs,” says Jensen. “It’s a cradle-to-grave, one-stop, box-build, turnkey facility.”
Contract partners often require “tuning, calibration, and extensive testing on the back end,” he adds. “We have an electrical embedded systems background from our engineering side, and those disciplines carry over to our manufacturing.”
VPI also manufactures control panels and “oddball things” for other clients, including a ski-curing machine for a local snowsports manufacturer
“There is a fair amount of manual labor in the things that we do, and most of our products, dollar-wise, would be considered high rent,” says Jensen. “There’s always a few a year that are very complex. We can do some systems that are like 500 [units] but take us a year to build because of the complexity of the system. Some of these are very advanced security systems.”
That results in a “sweet spot” with projects that are notably complex and low-volume for VPI’s domestic manufacturing arm. “We have the ability to expand and scale,” says Jensen. “It’s just about the demand of the market. We can do a prototype of something in a commercial space, but we want to get that out to higher-volume production as quickly as possible. It’ll save money for the client and it’ll get turned around quicker, because internationally, I have a staff of thousands.”
Helping clients with design for manufacturability is another focal point at VPI. “A lot of times a startup will come up to me and say, ‘We’re going to make millions of these,’ or ‘This is going to change the world.’ I say, ‘Send me your files,’ and they basically give me a napkin,” says Jensen. “Most people that design a product really don’t have manufacturing in mind, but my team gets in there very early in the development phase.”
The company’s engineering acumen helps avoid pitfalls well in advance. “We architect from the ground up what the critical requirements to manufacturing are, not just passing an engineering sniff test,” he explains. “On our engineering side, any given engineer is touching three to five projects a year in the design, and we’re migrating that into production in one form or another.”
Jensen credits VPI’s team for making that transition seamless. “We have really, really good technicians, so things that require a broad range of knowledge that isn’t just turning screws, slapping something together, and assembly line-type flow,” he says. “We do small-cell flows and single-cell assemblies and buildups.”
Documentation is also hardwired into VPI’s business model, allowing clients to move projects to other contract partners if needed. “We pride ourselves on not holding our clients hostage,” says Jensen. “We want to keep our clients because we’re good, not because we have coercive power over them.
VPI has consistently seen a steady trajectory over its nearly three decades in business. “We are very conservative in our growth,” says Jensen, citing a typical annual uptick of 10 to 15 percent. “We feel like the turtle, but we keep a good cadence. I think that’s a good description of it, and that’s true of all of our divisions.”
Challenges: “Definitely supply chain on the electronics side,” says Jensen, noting that some components have a 60-week backlog as of late 2022. “That’s been super challenging. I don’t think that’s different from anyone else.
“Finding the right clientele” is another challenge for VPI’s domestic manufacturing operation, he adds. “The opportunities we get typically are generally not complex enough.”
Opportunities: Jensen says ISO 13485 certification would bring in more work from the medical device industry. “We’re not medical-certified, but we’re about to go into that process,” he says. “I do believe that will open up a lot of doors for us.”
Needs: “As you look at manufacturing, one of the questions is: How vertically do we integrate — and across which disciplines?” says Jensen, pointing to CNC tools for metalworking as a top consideration. “That’s one of the things we’re always evaluating, just because I don’t like to bring in things that we don’t have line of sight for projects on. Just adding a capability isn’t very smart unless you have some context.”