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03. May 2022
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Strategic Obsolescence Management Starts During Design-In

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Many companies tend to neglect the issue of obsolescence. But this could cost them dearly, and this trend is continuing. Electronic parts and other components are being developed at an ever-increasing speed. New functions are being added as both performance and speed have increased. In order to be included in the design of new end products, many manufacturers often choose to invest in the development of new components rather than spending time and money on the production of already established products. If components for established products are discontinued, then it often requires a huge effort to repair or produce these products – if it is even possible at all - because subsequent products are often not compatible. This situation is escalating. Last year, more than 150,000 components were discontinued. For many high-tech developments, the service life of components and end products are drifting further and further apart. Nowadays many components have a service life cycle of just one or two years.

That is why when a new product is being developed, it is essential to take into account the life-cycle of the components being used. Obsolescence management should start right from the design-in, including any possible alternative components or supply sources. Not considering this aspect during layout could be very risky. If the available stock runs out, the components need to be found on the open market or from a second source at short notice. However, very often a complete redesign is the only option. This, in turn, requires new agreements, approvals and EMC tests. The problem here is not only the extra expense but also the issue of “time to market”.

Obsolescence can never be completely prevented, but there are several measures and strategies to deal with it in order to avoid worst case scenarios. These include, among other things, the right choice of suppliers, appropriate and sufficient stock, and the foresight to plan in a second source.

1. Second Source

If components with an available second source were selected during design-in, a discontinuation would initially hold no great risks. Some tools or database providers on the market do advertise to be able to display the availability. The real life cycles, however, can only be reproduced inadequately here. For this reason, we clearly recommend approaching the manufacturer of the respective components directly. But of course it is much more of a problem if a second source was not included right from the design-in. Then the frantic and risky search on the free market begins, or an alternative has to be found.

2. Storage/Warehousing

Even if a second source is available in case of discontinuation, it makes sense to plan for sufficient stock in good time – especially if the components or modules are intended for use in long-term products. Increasingly, storing the complete electronic module is the only way to ensure the availability of the applications over a longer period.

Sounds simple and logical. However, the storage concept needs to be appropriate for the module components being stored. The aging of components during normal storage can affect their functionality and processability within just a few years. For example, diffusion processes damage connectors and the internal structures of semiconductor chips. Humidity and oxygen cause oxidation, which may result in whisker formation, or too low temperatures may cause tin pest. The list is endless. By the way, storage in a nitrogen atmosphere does not delay aging completely since, among all the aging processes, it only reduces oxidation – and does not even provide 100% protection from that.

Some procedures are indeed able to prevent the aging process for decades, and some service providers specialize in those. For example, components, but especially electronic modules, can be stored at low temperatures in a special chemical atmosphere. But this storage type is quite expensive and only makes sense if the components and electronics to be stored are of corresponding value. Furthermore, electric current needs to be applied regularly to the finished applications to prevent mainly electrolytic capacitors from losing capacity and durability during storage. It is obviously time-consuming and expensive to provide this constant care for the stored electronics and products. So, this kind of obsolescence management is seldom applied for components.

What Other Options Are There To Prevent Obsolescence?

At the end of the day, these considerations call for a sensible obsolescence management system that is well integrated in business processes. For such projects to truly work they require support and need to incorporate all departments – from development through to purchasing, from product management to maintenance. Luckily more and more companies are recognizing the importance of a functional obsolescence management, which the increase in members of the industry association COGD e.V., the Component Obsolescence Group Deutschland, shows. Würth Elektronik has also been a member of this association since the end of 2011. In addition to many other active workgroups, the COGD e. V. supports the creation of a standard in order that all relevant data in the value chain can be collected and processed in a largely automated and digitalized way. Let’s be honest, manual checking, validation and further processing of all product changes, PCNs (Product Change Notifications) and discontinuations (PTNs or PDNs), is very time-consuming and risky. That is why the COGD developed the smartPCN format. By including the smartPCN format in the VDMA standard 24903 and the subsequent amendment of the smartPCN content to match the revised VDMA standard 24903, the association has worked to create a standard that is already widely accepted, at least in Germany. But it is also attracting increasing international support. Provided all manufacturers and suppliers commit to sending standardized messages, and companies commit to creating structures for recording and processing PCNs automatically. The most important requirements for turning the smartPCN format into an internationally recognized standard will have been fulfilled.

For more information on our service regarding smartPCN and obsolescence, click here.

Tips for strategic foresight

If you don’t want to be left in the lurch because important components have been discontinued, or because they can’t be used in their modified form or function, the following is important:

  • Check components for their current product life cycle status right from the design-in
  • Carry out regular searches and check availability or ask the manufacturer to confirm availability
  • If necessary, have a second source ready or
  • Keep sufficient stock, and ensure the quality of the components and/or modules
  • In the best-case scenario, use smartPCN format compatible tools to be able to respond faster to product changes or discontinuations

Create Problem Awareness

Most importantly, create an awareness of obsolescence risks and make young engineers also understand why obsolescence management is important. Innovation is promoted everywhere, but the downside to this celebrated innovation has a name too: obsolescence. And its risks have to be managed. Here’s my opinion: this topic should definitely be included in the curriculum at universities and technology institutes. In addition, networking is important and the COGD e. V. offers a great opportunity here – not only as a source of information, but also as an information platform.

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