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Suppliers, component makers and customers need to work together if they are to effectively manage obsolescence

More components specified for long design cycle assembly are being made obsolete or fast heading towards end of life, even before the assembly goes into production. This means the management of obsolescence is becoming an issue for markets beyond the traditional high reliability sectors, such as medical, military, aerospace and industrial.

More components specified for long design cycle assembly are being made obsolete or fast heading towards end of life, even before the assembly goes into production. This means the management of obsolescence is becoming an issue for markets beyond the traditional high reliability sectors, such as medical, military, aerospace and industrial.

In traditional markets, such as commercial avionics, the awareness of obsolescence has increased over the past five years and there have been improvements both in up-front design decisions as well as in the methodology of managing obsolescence. There is also a greater awareness of the need for traceability, with more customers asking for Certificates of Conformity or Conformance with each shipment.

Eric Checkoway, general manager of Converge – a unit of Arrow Electronics specialising in obsolescence – says: "The lifecycle of components has generally decreased, causing a rise in incidents of obsolescence. OEMs and contract manufacturers have to manage their inventories more closely, including their end of life (EOL) purchasing programmes. However, we're increasingly seeing cases where not enough buffer stock is available to avoid shortages of obsolete products."

"While obsolescence is now an issue for a growing number of companies, not much has changed for defence contractors," suggests Dan Deisz, director of design and technology, at Rochester Electronics. "The annual budget cycle for defence, coupled with extremely long deployment timelines and qualification cycles, ensures that first systems will still contain many obsolescence issues. Defence contractors have tried to avoid up front costs to the point of requiring yet-to-be-budgeted refresh/redesign which ensures a never ending cycle of obsolescence issues."

As more industries address obsolescence there's a growing understanding amongst them of the need to have obsolescence management plans in place to cover both the life of manufacturing and the use of equipment to remain competitive. Budget cutbacks, however, mean fewer companies have the budget to fund dedicated obsolescence managers.

"For some companies, raising the issue of obsolescence management is like swearing!" says Mark Shanley, international business manager, Astute Electronics. "Staff cut backs mean that companies are increasingly relying on lifecycle databases, but the problem is that these provide static data which can become dated very quickly.

"Astute works alongside IHS to capture the EOL or Parts Change Notices (PCN) alerts, then proactively identify all the stock which we believe to be of good quality and from reliable sources in the market. We then give an indication on each component so designers and purchasers can see what is available and what is likely to be problematic."

Defence budget cuts have encouraged companies to turn to COTS parts – which have a much shorter life cycle than full military-grade components, so they need replacing more often. Yet, according to Shanley, very little thought is given to this at the design stage and this is, in turn, being exacerbated by equipment having to remain in service for a lot longer than would previously have been expected.

The shrinking of the supply chain is also causing problems when it comes to managing obsolescence.

"Mergers and acquisitions have resulted in a shrinking of the supply chain, with smaller specialist suppliers being bought up by the major distributors and many component manufacturers have also been bought by larger competitors.

"Looking at semiconductors, many manufacturers are not producing military grade components. So it's really no surprise to see the most commonly counterfeited components being industrial grade devices being passed off as military spec," suggests Shanley.

If obsolescence is to be managed effectively, then it is vital that a clear transparent partnership between suppliers, component makers and customers is set up.

Shanley warns that narrowing of supply chains and the mergers and acquisitions of the original component manufacturers (OCM) will continue to cause problems for legacy builds, along with the effects of conflict minerals and the effect of raw material suppliers.

"Probably the greatest challenge, for distributors and manufacturers is to learn to leave their egos at the door and to work collaboratively," he warns.

Most companies and distributors will argue that it is important to have face-to-face conversations and also perhaps to include the after-market manufacturers in discussions.

"Slowly, requests for longer product support are emerging, building a bridge between customers, the original component manufacturer and long term support providers, with the assurance that obsolescence will not be an issue for as long as a component is needed. This is a win for the OCM because it gives assurance that designing in one of its components is not a short term performance and capability decision. It is, in fact, a long term strategic decision that will allow designers the freedom to develop the latest products, as opposed to figuring out redesigns for products that are still in production," suggests George Karalias, director of marketing and communications at Rochester Electronics.

Design engineers need to understand the shorter lifecycles involved to and choose manufacturers not on price, but on the capabilities they offer to the high reliability market, argues Shanley. "For example, Linear Technology is a very good example of a company which very rarely makes any product obsolete and is committed to longer product lifecycles, even if there is an added cost. This outweighs the redesign costs for sophisticated military equipment."

Deisz believes designers need the time and the budget to effectively stay ahead of obsolescence.

"If designers continually get pushed to get a product out the door in weeks/months at today's lowest cost, we will continue to see increasing obsolescence issues. Total lifecycle costs should influence technology decisions and improve obsolescence mitigation when taken into account up front, but are very often trumped by that first customer timeline and up-front costs."

Regulations, initiatives and directives including RoHS, REACH, ITAR, the NDAA from the USA and E-Waste all impact obsolescence. Specialist distributors should be partnered with to ensure that quality, rather than price, is the default process to mitigate the risks.

Environmental legislation such as REACH and ROHS has had a significant impact on obsolescence and defence authorities are starting to include contractual clauses covering counterfeit materiel, including US (DOD NDAA) and UK (MOD Def Stan 05-135).

"These contractual clauses will make equipment manufacturers and suppliers liable for any counterfeit equipment or counterfeit materiel found. They are also starting to introduce assessments for measuring and determining counterfeit mitigation and avoidance all the way through their equipment supply chain. Once firmly established, this type of assessment is likely to be extended to other industries," believes Peter Marston, business development and technical consultant, at Rochester Electronics.

Going forward, it is vital that in order to remain competitive purchasers, manufacturers and users fully understand the cost of obsolescence. Personnel who understand the obsolescence situation and solutions within their organisations are going to be vital.

COG's restructuring and the establishment of the International Institute for Obsolescence Management (IIOM) has recognised that need and is setting up suitable training programmes.

As Shanley concludes: "We all have a moral obligation and responsibility to find a solution, through working together, that can reduce the risk of obsolescence and counterfeit parts for safety critical applications."

Author
Neil Tyler

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