In its nine (soon to be 10) factories around the world, mobile-phone giant Nokia will churn out approximately 325 million handsets this year alone. That's 10 phones per second, every hour of every day, all year long.
by Andy ReinhardtNokia is one of the world's largest and most sophisticated manufacturers. Though highly automated, the production process still involves significant human intervention, from placing high-value components like digital camera modules by hand, to visually inspecting and testing finished products, to packing phones in boxes.
For strategic reasons, Nokia does virtually all this work itself, rather than farming it out. Why? To ensure control over the process and keep costs down. The formula seems to work. On average, it costs Nokia 69 euros ($87.63) to make a phone, and on average it sells phones for 102 euros ($129.54), leaving a gross margin of nearly 33%, better than its rivals can muster.
In the following slides, see how the workers at Nokia's plant in Salo, Finland, make a phone, from raw materials to finished goods.
Parts pour into Nokia factories by the hundreds of millions every day. The company sources virtually all its components from outside suppliers: everything from memory chips and microprocessors to liquid-crystal displays, keypads, and plastic cases. On arrival at the loading dock, the parts are shuttled off on forklifts and cranes to gigantic storage areas, from which they're later fetched as needed for production.
The first step in making a Nokia phone is to gather up all the needed parts. Most electronic components, from resisters and capacitors to highly-integrated circuits, are delivered by suppliers on reels of tape, protected in circular plastic cases.
At the heart of every Nokia phone is a slender strip of plastic covered with a latticework of basic circuits and settings for the installation of chips and other electronic components. Here, printed circuit boards enter the paste printing machine, which lays down a patterned layer of solder paste, made from a tin-copper-silver alloy. The paste is later melted in an oven to bind electronic components to the board.
Reels of components are loaded onto spindles. From there, they feed into automated "pick-and-place machines" that grab individual parts off the tape and lay them precisely onto the printed circuit boards. Nokia uses mostly "surface mount" components that lie flat on the board.
Circuit boards travel down a belt from one pick-and-place machine to the next, and by the time they reach the end of the line, all the basic components have been installed. After the parts are in place, the boards go to an oven for seven minutes, where the solder paste is melted and the parts become firmly attached.
The first quality test takes place after the basic components have been installed. The boards are advanced automatically on tracks into the "flash and alignment" stage, where basic software is first installed into programmable components.
A robotic arm lifts the board off the track and puts it into a bay. There, the chips on the board are configured with low-level settings, such as what power level the phone will operate on. Then, a series of electronic tests are administered to ensure that the circuit board is perfect, all the parts work, and that they have been correctly installed.
At this stage, the hand work begins. Here, a worker plucks digital camera modules from a reel and installs them with tweezers onto assembled, tested, printed circuit boards. The expensive and fragile liquid-crystal display screens are also added by hand.
A nearby worker performs another essential task by hand: sandwiching the completed printed circuit board between front and back structural frames, later adding the outside covers.
The last step in the production turns a generic phone into one customized to the exacting specifications of mobile-phone users around the world. Each handset is put into a cradle, where it is given a unique serial number, known as its IMEI code.
Then, depending on who the customer is, a unique batch of software code is pumped into the phone. Vodafone will specify one set of menus and features, as well as a Vodafone logo on the opening screen, while Cingular will require a different appearance and capabilities.
Finally, the phone and installed software undergo a battery of diagnostic tests. From this point forward, the IMEI code links each individual phone to its intended customer.
It seems quaint after all the high-tech assembly and testing, but before every Nokia phone goes into a box, it's inspected one last time by an unmatched resource: the human eye. Only a tiny fraction of phones fail this final test. Then, before being packed, the phone is de-ionized to remove dust and electrical charge from the surface.
Phones are packed into retail boxes by hand, with appropriate documentation and accessories, and then logged into a tracking system using a bar-code reader.
Batches of phones headed for the same destination are packed into boxes and stored on palettes. Each palette contains hundreds of customized phones intended for specific mobile operators.
Palettes are loaded into tractor-trailers on the loading dock, and trucks head out to the airport, the port, or overland to deliver Nokia phones to carriers and retailers around the world. Many phones from Salo go to the port in nearby Turku, but some are flown from Helsinki, depending on the urgency of the delivery.
