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Fiber Optic Services And Products
EYE ON FIBER
Volume 2, Issue 2
June 2003
Part 1: Five
Factors Determine the Lowest Cost Fiber Connector Installation Method
Executive Summary
There is no one simple answer to the total installed connector
cost question. Instead, consideration
of the five main factors that determine total installed connector cost reveals
multiple installation methods may be suitable- even in a single facility.
Introduction
Twenty-one years ago, I installed my first fiber optic
connector. Since that time, I have
installed or supervised the installation of more than 33,000 connectors of more
than 14 types by at least seven methods.
Based on that experience and on recent research Pearson Technologies is
conducting, I have come to the conclusion that many designers and installers
are choosing the wrong method.
This statement is not solely my opinion-it is supported by the
conversations with many designers and installers throughout North America.
The reason for these errors is that many designers and installers
are not considering all five factors that determine total installed cost. Achieving the lowest total installed
cost is the goal of the decision making process. In developing software for costing fiber optic
installations, I have observed that five factors, connector cost, installation
rate, installation yield, total loaded labor rate, and labor utilization, can,
and do, result in different choices of installation method in different
situations.
Characteristics of the Five Connector Installation Methods
There are five connector installation methods which dominate the
fiber optic connector market (Table 1): epoxy, or pot and polish; Hot Melt
adhesive, an method exclusive to 3M fiber connectors; quick cure adhesives,
also known as anaerobic adhesives; crimp and polish, which require no adhesive;
and cleave and leave, which require no adhesive and no polishing. Each of these methods has advantages
and disadvantages, in reliability, in cost, in ease of installation, and in
amount of training required by the installer. In this article, we shall focus on those advantages and
disadvantages that influence the total installed cost.
Connector cost and installation rate are directly related: as the
cost increases, so does the installation rate. Connector cost ranges from 1x to roughly 6x depending on the
method of installation. This relationship between rate and cost implies that
the higher the total loaded labor rate, the more likely you will justify
spending more on the connector to achieve a reduced labor cost per connector
(Table 1).
Unfortunately, this conclusion does not included consideration of
yield, which I define as number of connectors that meet power loss
specification divided by number of connectors installed. As the installation
rate rises, there are three consequences: the yield tends to be lower, the
amount of training needed increases, and the discipline required of the
installer increases. In addition,
the converse seems to be true: as the installation rate falls, the difficulty
becomes less, and the yield increases.
For every organization, the labor rate tends to be fixed. However, the labor utilization can vary
widely, depending on the nature of the installation. I define the utilization as the amount of time spent specifically
in connector installation divided by the total time required for the connector
installation. The utilization depends on both the method of installation and
the number of connectors installed at each location.
The extremes are the epoxy method and the cleave-and-leave
method: the epoxy method requires the most set up and clean up time; the cleave
and leave method, the least.
In addition, utilization is dependent on the number of connectors
to be installed at each location and on the distance, or travel time, between
locations. For example, a vertical
riser fiber backbone cable may have 48 connectors for each of ten floors. In this example, there are 480 connectors
at one location, usually the basement, and 48 connectors at each of ten
locations. The labor utilization
for the basement will be high, since the installer must perform one set up and
one clean up for 480 connectors.
The utilization will be reduced for each of the ten floors, since
the installer must perform one set up and one clean up for each group of 48
connectors. If the network is a
fiber to the desk network with 4, 6 or 8 connectors at each location, the
utilization will be further reduced, since the installer must perform one set
up and one clean up for each group of four to eight connectors.
The labor utilization will be reduced as the distance, and travel
time, between locations increases.
The labor utilization for the installation of a vertical riser fiber
backbone cable will be higher than the same cable system installed between ten
buildings as a campus backbone.
The full analysis of these five factors indicates that there is
no single solution that provides the lowest total installed cost for all
networks, even in a single facility.
For example, the labor rate, labor utilization, connector yield and
connector cost may favor one method for the basement of a vertical riser
backbone but a different method for the wall outlets of the horizontal cables
of a fiber to the desk backbone.
This conclusion, different fiber optic connector installation
methods for different locations in the same facility, has two consequences:
increased training requirements and a slightly increased tool cost. However, for an organization that is
continually installing fiber optic connectors, the increased training and tool
costs become unimportant after it installs the first few hundred connectors.
|
Method |
$/ connector |
Connectors/hour |
% yield |
Description |
Favored situation |
|
Epoxy |
low |
low |
high |
Inject and cure epoxy; crimp; polish end |
Low labor rate; large number of
connectors per location |
|
Quick cure Adhesive |
low |
medium |
Medium to high |
Inject adhesive; crimp and polish end |
Low to medium labor rate; highly trained
installers |
|
Hot Melt adhesive |
medium |
medium |
high |
Preheat connector; polish end |
Low to medium labor rate; highly trained
installers |
|
Polish, no adhesive |
medium |
medium |
Medium to high |
Crimp fiber; polish end |
Low to medium labor rate; highly trained
installers |
|
Cleave and leave |
high |
high |
Medium to Medium high |
Cleave fiber; crimp fiber; no polish |
Very high labor rate; highly trained
installers; few connectors per location |
Table 1: Characteristics
of the Five Main Fiber Optic Connector Installation Methods
Conclusions
The question is: Which is the best fiber optic connector
installation method? The simple answer is: it depends. The more complicated, but realistic,
answer is: it depends on how the specifics of the installation influence the
five factors. In this time of
business difficulty, good decision-making is critical. Good decision-making requires
determination and analysis of these five factors.
Note: Hot Melt is a trademark of the 3M Corporation.
Part 2: Connector Installation
Cost Model: A Strategy for Profitability
Executive Summary
In this document, we present a fiber optic connector installed
cost calculation model. This model
is a decision making tool for installers and manufacturers of fiber optic
connectors. This model enables installers to determine the installation method
and product that results in the lowest total installed cost. From this cost, installers can maximize
their profitability. This model helps manufacturers define the cost at which
their products and installation methods will be cost competitive and
profitable. This model is based on our 21 years of work with more than 33,000
fiber optic connectors, on data shared by professional installers and on our
unbiased view of the connector installation process.
Section 1: Overview of The Model
In the previous part of this issue, we presented a qualitative
look at choosing a connector installation method. In this part, we present a quantitative picture.
Introduction. For the
last 21 years, we have worked with connectors, in field installations, in
creating test leads and troubleshooting cables for our training programs, and
in training more than 5000 people with more than 33,000 fiber optic
connectors. We have worked with
all the major installation methods and most of the connector types.
Recently, we began a project of evaluation of the cleave and
leave (C&L)connectors. We
began this project to resolve the large divergence between the large number of
C&L connectors being sold and the consistently bad reports we received from
the field.
While this project is not yet complete, we have been pleased with
the initial results from testing of C&L connectors from three manufacturers. As we planned this project, we were
thinking ahead to what we should do when this evaluation project is
complete. We wanted to be able to
make recommendations, but did not know when to recommend the C&L connectors
because of their premium prices. What would happen if our project showed good
results? Should we recommend the C&L connectors to our clients and
trainees? Finally, under what conditions should we recommend this method?
In order to answer these questions, we needed to define the
conditions under which the C&L connectors would provide the lowest total
installed cost. To define those conditions, we needed a cost model.
During our work, we have performed installations for clients, we
have performed oversight consulting on network design, and trained personnel in
network design, for private clients, and, presently, for BICSI. During this work, we created of a
series of spreadsheets for cost calculation. However, these spreadsheets did not do exactly what we
wanted: to numerically define conditions so that we could choose the
installation method with the lowest total installed cost. We had a number of
pieces, but not all the pieces. Thus began our effort that led to this model.
This model allows the user to create a multi-dimensional cloud, within
which one connector installation method will have the lowest total installed
cost. This cloud is defined by
ranges of values for each of the seven key cost factors.
The Model Assumptions and Seven Key Cost Factors. The objective of the model is to create a numerical
description of the cost factors of any connector installation. Since installation conditions vary
widely, we had to develop a flexible description. This description includes
seven key cost factors:
total loaded labor rate, in dollars per hour;
installation rate, in connectors per hour,
time utilization, in %;
a model for calculating time utilization;
connector cost;
consumable costs; and
process yield, in %.
Total Loaded Labor Rate.
The total loaded labor rate can vary widely. We set up the model with a range from $20 to $80 /hour.
$35/hour represents a consensus for non unionized locations, such as Washington
DC and south and central New Jersey. $60- $70/hour represents unionized rates for locations
such as New York City, when the installers work directly for the organization
that owns the installed network.
$80/hour represents the rate for an outside installation firm in a
highly unionized environment.
Installation Rates. The installation
rates, in connectors per hour, are based on our experience and that of
professional installers who have shared their experiences with us. Some will argue with these rates. However, the focus of this model is not
on the rates, but on the total installed costs. Changing the rates may change the relationships between the
epoxy, quick cure and hot melt adhesive methods. However, because of the premium price of the cleave and
leave products, changing the cleave and leave rates may not significantly
change the relationships between the cleave and leave cost and the costs of the
other three methods.
These rates assume that the cable has been prepared to expose the
tight buffer tubes. Alternatively,
the furcation or break out kit is installed onto a loose tube cable, which
condition is the same as that of the tight tube cable with exposed tight buffer
tubes. We have included no time
for end preparation of the cable or for installing the terminated cable into
the enclosure. This time will be
independent of the connector installation method and is of no concern. In
short, the connector installation rate includes the time to strip the buffer
tube and primary coating, clean the fiber and install the connector.
With the exception of the cleave and leave method, the
installation rates for singlemode connectors are lower than those for multimode
connectors, since the singlemode connectors are polished for low reflectance.
Such polishing requires increased time.
Time Utilization. The
labor cost is increased to include the effects of time spent on activities
other than the actual installation of the connector. We make this modification with the term time
utilization. Such activities include breaks, travel time from location to
location, set up, clean up, and packing of equipment at each location. No
consideration is included for lock out time, which would result from inability
to gain access to the location for installation. However, lock out time could
be added to one of the five utilization factors.
Time Utilization Model. Time
utilization is the ratio of time spent in installation to the total time spent
to accomplish the installation. The time utilization model includes five
factors:
a fixed time per
eight hour shift for planned breaks;
a fixed time per
eight hour shift for unplanned breaks; unplanned loss of time is common in
field installation.
a time factor for
travel to each installation location;
a time factor for all
activities prior to and after the connector installation time;
the number of
connectors to be installed at a location; and
the connector
installation rate.
This model has great flexibility, in that each of these five
factors can be changed to values appropriate for almost any installation
situation. For example, the time
factor for travel to the installation location can be small, medium or
large. A small travel time factor
is appropriate for an FTTD installation; a medium, for a vertical riser
installation; or large, for installation of a campus back bone network. This
flexibility allows the user to input almost any set of conditions by modifying
one of these five factors.
The basic model assumes that the time utilization will be the
same for all methods. However,
this assumption is not true. See
Section 3 for discussion of this subject.
For simplicity, we have assumed the same time utilization for
multimode and singlemode connectors.
With the exception of the cleave and leave connectors, this assumption
is not valid, since singlemode connectors have lower installation rates than do
multimode. Here, our working
assumption is that singlemode connectors need be low reflectance, less than
–50 dB. If low reflectance is not a concern, then the same installation
rates can be assumed for multimode and singlemode connectors.
Connector Cost. The
prices are realistic prices, biased neither high nor low. We have estimated these prices as
being typical, or median, prices. Again, some will argue with these prices.
However, the focus of this model is not on the prices, but on the total
installed cost. Modification of
the prices may provide a price range within which one or more methods in
favored as lowest cost.
Since this is a cost model, we need not assume a connector style,
or type. However, the prices we used were for the SC connector.
Feedback on a preliminary version of this cost model indicted
that our connector prices were not representative of typical prices throughout
the market. We believe that
comment to be valid and have increased the prices to incorporate that comment.
Connector manufacturers may choose an alternative use of this
model: perform the reverse calculation. What should the price for any connector
be to result in a competitive total installed cost?
Consumable Costs. The
model includes the cost factors for consumables, such as epoxy, polishing film,
syringes, batteries for inspection microscopes, etc.. While these costs are estimates, they will not influence the
total installed cost significantly.
Process Yield. In the
basic model, we assume the same process
yield for all installation methods.
However, we believe that the yield will be different for the different
methods and different situations.
In general, we believe that installers with lower skill levels and
reduced training will experience significantly reduced yields for the quick
cure adhesive and C&L methods than for epoxy and hot melt adhesive
methods. Therefore, one implicit
assumption of this model is of highly trained installation personnel. However, with the appropriate yield
value, this model can be adjusted to represent less well trained and relatively
inexperienced personnel.
Connector Installation Methods. We present a model of the total installed cost of connectors by the
four major methods: epoxy and polish, Hot MeltŪ adhesive, quick cure adhesive,
and cleave and leave. Cleave and
leave is our term for connectors that require neither adhesive nor polishing.
The connector installation method changes three factors in the model: connector
cost, installation rate, and time utilization.
Section 2: Analysis of The Results of the Basic Model
The basic model (Table 3) provides an indication of the typical results. A simple, but slightly inaccurate, comparison of the differences between material costs and labor costs in Table 1 involves comparing lines 23 and 29: for a higher cost connector to be cost effective, an increase in material cost, line 23, must be more than offset by a reduction in labor cost, line 27. This comparison shows that the cleave and leave process cannot reduce the labor cost enough to justify its increased cost. For example, a decrease of $3.28 in labor cost is possible (cell F27-C27) but the increase if material cost is $8.61(cell F23-C23). If the cost of the cleave and leave connector drops to $8 (cell H10), the C&L method has the second lowest total installed cost at labor rates above $50/hour.
Table 3:
Basic Model
|
Base Total |
|
|
|
|
|
|
|
|
|
|
Loaded
Labor rate |
|
$/hr |
|
|
|
|
|
|
|
|
connector type |
|
SC |
Multimode |
|
|
|
|
|
|
|
installation method |
|
epoxy |
Hot MeltŪ |
cleave & |
cleave |
cleave & |
|
|
|
|
|
|
|
|
quick cure |
leave |
&
leave |
leave |
|
|
|
fiber type |
|
|
|
|
|
what if |
what if |
|
|
|
Connector Pricing Source, |
|
|
|
|
|
|
|
|
|
|
Manufacturer/Distributor |
|
|
|
|
|
|
|
|
|
|
cost item |
|
|
|
|
|
|
|
|
|
|
connector |
|
3.00 |
5.50 |
3.00 |
12.00 |
10.00 |
8.00 |
|
|
|
epoxy/adhesive |
|
0.20 |
0.00 |
0.10 |
0.00 |
0.00 |
0.00 |
|
|
|
syringe |
|
0.01 |
0.00 |
0.03 |
0.00 |
0.00 |
|||