Electronic Part Obsolescence Explained

 

Electronic part obsolescence is a growing issue for modern electronic products. Learn about obsolescence and how to minimize its impact.

 

Modern electronic products are a mix of electronic parts dependent on a variety of technologies, manufacturing processes, materials, and packaging. Any of these elements may fall out of favor due to things like material regulations or availability of better technologies. This drives demand down, to the point where the part manufacturer stops producing the part—even when there is some lingering demand.

 

This situation occurs frequently for long product manufacturing and support products in industries like medical devices, transportation, aerospace and defense, and industrial automation. Obsolescence is particularly challenging for these high-mix (by part type) / low volume product manufacturers and their customers, who often work with the world’s critical infrastructure—hospitals, light and heavy rail, aircraft and defense systems, and manufacturing lines. Better understanding and effective management of part obsolescence not only helps product manufacturers, but helps all of us who rely on those products in our daily lives.

 

A common type of obsolescence is when an electronic part is no longer made by the original manufacturer. Electronic part obsolescence can have a dramatic impact on the production of an electronic product and its associated revenue. If sufficient inventories aren’t available in the distribution chain or onsite at the product manufacturer, new products can’t be made and existing products in the field can’t be maintained.

 

When part obsolescence occurs without warning and without obsolescence planning, product manufacturers are faced with a difficult problem and often a limited number of options. Product manufacturers can try to find alternative parts, buy the part at marked-up prices from aftermarket distributors, buy parts on the gray market and risk counterfeits, redesign their product without the obsolete part, or perhaps discontinue the product when there is still demand—and lose sales.

 

To minimize these obsolescence situations—or at least minimize their impacts, electronic product manufacturers are proactively building resilience into electronic part supply and using advanced practices to anticipate and manage obsolescence.

 

One common strategy for mitigating the susceptibility of an electronic product to obsolescence is to pre-purchase an adequate inventory of the part to meet the supply needs of the forecasted demand for a product. Though this approach effectively ensures the necessary supply of the electronic parts over the lifetime of an electronic product, it also comes with a high level of risk, can substantially increase the cost of a product, and requires the necessary capital in advance. Part of the risk with this approach is accurately forecasting the demand for a product, though some of this risk is mitigated if excess inventory can be resold.

 

Besides the brute-force inventory buffer approach, there are a variety of other strategies. Some examples include:

1. Identifying alternative part sources upfront—often designing with an internal part number that maps to multiple form/fit/function alternatives
2. Proactively tracking and alerting on manufacturer advanced notices of obsolescence, i.e. End of Life (EOL) notices
3. Tracking inventory in the distribution chain—even if the part is obsolete, it may be available
4. Analyzing inventory and pricing trends in the distribution chain to anticipate availability levels
5. Considering aftermarket sources
6. Using modern predictive methodologies and tools

 

Accuris Electronic Parts Solutions can help with each of the obsolescence management strategies above, with a variety of solutions to meet your needs. Get in touch with us at the bottom of the article to learn more. 

 

The field of practices for accounting for obsolescence during product design, manufacturing, and sustainment is known as Electronic Part Obsolescence Management (EPOM), or Electronic Part Obsolescence Risk Management (EPORM). EPOM/EPORM is a subsection of diminishing manufacturing shortages and material shortages (DMSMS) activities, which is one component of the larger set of strategies and practices comprising Electronic Part Supply Chain Risk Management/Supply Chain Management (SCRM/SCM). The International Electrotechnical Commission (IEC) recently published a new version to their widely adopted IEC 62402 Obsolescence Management standard. This standard provides a solid framework for obsolescence management practices and has been adopted by many of the largest companies in the world.

 

Bridging the gap between the lifecycle of products and the lifecycle of its constituent parts will likely always be a challenge. Using available content, strategies, and tools will help you bridge the gap with the least amount of stress.