Imagine this: you’ve just received a new order for your flagship product – the cornerstone of your business. It’s popular, profitable, and in high demand. You’re ready to move full steam ahead, confident that everything is in place for production to begin.
Then the phone rings.
A key supplier informs you that a critical component has been made obsolete. It’s no longer manufactured and there’s no stock left.
Frustrating, but manageable – right? You reach out to your alternate sources, only to hear the same thing: the part is gone across the board.
As the news moves up the chain, panic sets in. Suddenly, your leadership team looks more like Olympic athletes – jumping to conclusions, running in circles, and sprinting into crisis mode.
Your product – and your revenue – is now at serious risk.
What are your options?
You start evaluating your (very limited) alternatives:
- Divert parts from another production line? That jeopardises another product
- Salvage components from unshipped units? That delays or compromises customer commitments
- Source from the grey market? That opens the door to counterfeit or substandard components
Now you’re stuck with the worst-case scenario: trade-offs, compromises, and risk.
Do you proceed with the grey market?
- Have these suppliers proven reliable in the past?
- Do they follow anti-counterfeit standards?
- Have they implemented certifications such as:
- AS6081 – Counterfeit Electronic Parts: Detection and Mitigation
- CCAP-101 – Counterfeit Component Avoidance Program
- AS6301 – Compliance Verification Criterion Standard for SAE AS6081
- ARP6178 – Fraudulent/ Counterfeit Electronic Parts; Tool for Risk Assessment of Distributors
- Do you regularly audit their processes?
How did we get here – and how could this have been avoided?
Let’s look at what could have been.
The role of proactive obsolescence management
Procurement and purchasing are the visible face of your supply chain. But they cannot work in isolation. To be effective, they must collaborate closely with:
- Engineering
- Product Lifecycle Management (PLM)
- Quality assurance
Together, these teams ensure that:
- Critical components are current and available
- Valid alternatives are identified, qualified, and approved in advance
Understanding obsolescence
The term comes from the Latin obsoletus, meaning “worn out or outdated.”
According to IEC 62402, obsolescence is defined as: “No longer in production by the manufacturer in accordance with the original specification.”
It’s not just obsolete – it’s unavailable by design. This may occur naturally as product lifecycles end – or be forced by regulatory changes that restrict the use of certain materials or substances.
Proactive vs. reactive obsolescence management
Obsolescence shouldn’t be addressed only when a crisis emerges. Management must begin early – in the design phase – and continue through ongoing lifecycle monitoring.
During design:
- Avoid sole-source components where possible
- Be cautious with high-tech, exotic parts (e.g., microprocessors, memory chips, RF components), which are typically more difficult and costly to replace
During production:
Most Original Component Manufacturers (OCMs) publish lifecycle alerts:
- PCNs – Product Change Notices
- NRND – Not Recommended for New Designs
- PDNs – Product Discontinuation Notices
- EoLs – End-of-Life Notices
Yet in 2022, of the >750,000 components discontinued, 30% of these components were pulled without any advance notice.
Given that, how can you forecast what is at risk?
Forecasting tools for component lifecycle
Platforms like Z2Data (my personal go-to), SiliconExpert, and Assent can estimate YTEOL (Years to End of Life) using proprietary algorithms based on historical and market data. These platforms claim over 90% accuracy, giving your teams time to plan:
- Alternative sourcing
- Product redesign
- Lifecycle extension strategies
Regulatory compliance: a growing threat to availability
Legislation is now one of the biggest drivers of obsolescence.
Consider RoHS (Restriction of Hazardous Substances), introduced by the EU in 2006. What began as a list of 6 banned substances has now expanded to 10:
- Lead (Pb)
- Mercury (Hg)
- Cadmium (Cd)
- Hexavalent Chromium (Cr6+)
- PBB
- PBDE
- DEHP
- BBP
- DBP
- DIBP
Is your team actively monitoring for RoHS compliance?
What about:
- REACH – Registration, Evaluation, Authorisation and Restriction of Chemicals
- SVHC – Substances of Very High Concern
- SCIP – Substances Contained in Products
- China RoHS – China’s separate regulatory framework
- TSCA – U.S. Toxic Substances Control Act
- California Proposition 65
These are not optional. Depending on your markets, non-compliance can mean blocked shipments, fines, or worse.
Collaboration is critical
To be successful, obsolescence management must be cross functional.
Purchasing teams are at the front line – but they depend on:
- Engineering to evaluate alternatives
- PLM to track lifecycle status
- Quality to assess substitutes
- Leadership to support proactive investment
Don’t forget your suppliers
Even if your in-house process is robust, ask yourself: do your sub-assembly suppliers have an Obsolescence Management Plan in place? Do you audit their readiness? Because even if your BOM is secure, it doesn’t help if your subcontractors use obsolete, or soon to be obsolete parts in their builds. The outcome is the same: missed deliveries, customer dissatisfaction, and lost revenue.
Obsolescence management is not a one-time fix
This is not a checkbox activity. It’s an ongoing, evolving responsibility. Moving from a reactive posture to a proactive strategy is the only sustainable path forward.
Quality must remain engaged to ensure that suppliers are proactive in ensuring that they continue to monitor their own processes and that of suppliers.
Yet for small and medium-sized businesses, resource constraints can make this challenging.
That’s where CNX Technical and Innovation Group step in – with cost-effective, tailored solutions for proactive obsolescence and compliance monitoring, without the overhead of expensive licenses or inhouse specialists.
Final thoughts
Don’t let obsolescence disrupt your business.
Procurement is a vital part of a larger operational ecosystem.
Without active collaboration from other departments, its effectiveness is significantly diminished.
To mitigate the risks of obsolescence – which can threaten both product integrity and manufacturing capabilities – business leaders must foster strong integration across all relevant teams.
Failing to do so will ultimately impact productivity, profitability, and longterm sustainability.
Plan ahead.
Collaborate across teams.
Engage partners who can keep your supply chain resilient.
For more information of the Z2Data Obsolescence Management Solution, please contact Oliver Hoffmann at: oliver.hoffmann@z2data.com
This article originally appeared in the Sept/Oct issue of Procurement Pro.
Author: John Wombwell CNX Technology and Innovation Group
