In today’s fast-paced technological landscape, staying ahead of the curve is essential for businesses to remain competitive. Component obsolescence should never be addressed as an afterthought, but rather as a proactive consideration.
A few questions for any plan:
- Does the project plan need to include anticipated product refresh or redesign during its life? Are resources allocated to support these plans? These events are not one-time actions; instead, they necessitate consistent and regular evaluations
- How will the business account for the capital locked up in long-term component sourcing? For many long-term projects, the sums of money tied up in last-time-buy stock represent a significant financial investment
- How will component obsolescence impact after-sales service commitments? Often forgotten are the costs of servicing a long and uncertain after-market tail
- What effect would a shortened equipment life have on your customers and end-users? Prematurely ending the life of equipment or cutting short the service life can have costly consequences, including reputational damage
Anticipating unknowns in the market and future sales
While component lifecycles are trackable, EOL predictability is not infallible. Most predictions rely on algorithms. However, unpredictable ‘events’ have the power to surpass mathematical calculations.
Component obsolescence and the subsequent request for ‘Last-Time-Buys’ instigate a requirement for customers to predict their future equipment sales. However, these forecasts often prove to be unreliable due to unforeseen market changes.
By sharing the Bill of Materials (BOM) or critical parts lists for long-term programs with their component supplier, customers can gain a comprehensive understanding of project risks.
Authorised aftermarket distributors and manufacturers, such as Rochester Electronics, provide a risk-free long-term source for semiconductors.
Additionally, partnering with a licensed semiconductor manufacturer can mitigate the risks of component EOL. A licensed manufacturer can produce devices no longer supplied by the OCM. When a component is discontinued, the remaining tested wafer and die, the assembly processes, and the original test IP, are transferred to the licensed manufacturer by the OCM. This means that previously discontinued components are still available newly manufactured, and 100% in compliance with the original specifications.
This article originally appeared in the November issue of Procurement Pro.
