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12 The Official Daily Tag 4 – Freitag 18 November 2022 Obsolescence Management ❚ Completely without strategic obsolescence management? There’s no getting around it in the future How can production continue in the face of crises? “In any case nothing will work without strategic obsolescence management ” Dr Wolfgang Heinbach and Axel Wagner of COGD are convinced in an interview with Markt Technik Markt Technik Geopolitical upheavals the consequences of COVID-19 deglobalization – every day brings new risks and challenges Do manufacturing companies in Europe and especially in Germany have to completely reorganize their supply chains for the future? Dr Wolfgang Heinbach Completely reorganizing is often not possible there are usually a number of good economic and political reasons for this But at the very least Ibelieve that an intensive rethink of the current strategy is more than overdue from the point of view of obsolescence Although many companies were able to increase sales and earnings in 2021 and the first six months of this year in some cases even significantly despite the scarcity of resources in many areas does not mean that all these companies have their supply chain problems fully under control Ifear that the last three years are just a taste of what can happen when many potential disruptors impact global supply chains – in the worst case simultaneously In your opinion what could be even worse in terms of supply security in the future than is already the case for many companies? Heinbach The question should rather be whether in view of the many political and economic uncertainties there is currently anything at all that might not deteriorate even further over the coming months and years It would be beyond the scope of this interview to list all the critical points For example we at COGD have been observing with concern for some time that more and more chip manufacturers are moving their aging parts to EOL end of life status earlier in order to better meet changing market priorities Where the journey is headed becomes clear when evaluating the current change notices Whereas before COVID-19 the proportion of discontinuations was still 2 to 3 percent we are now averaging between 6 and 8 percent If this trend continues it does not bode well for manufacturers of durable goods in particular Because some of the components affected are sometimes difficult or impossible to replace it is possible that even for some products that have been relatively readily available up to now demand will increase dramatically again as a result of discontinuation which in turn can lead to significant supply bottlenecks even before the actual obsolescence occurs Material purchasers therefore have nothing to laugh about at the moment and Iassume that this will continue for some time to come Itherefore suspect that in just a few years hardly any industrial company will be able to do without strategic obsolescence management Why exactly is strategic obsolescence management so important for industrial companies especially in these times which are difficult in many respects? Axel Wagner Because in view of the large number of potential negative influencing factors today it is usually decided in the evaluation phase of a new product how well or poorly any risks can be managed over the entire life cycle of the device Efficient obsolescence management definitely starts at the designin stage If plastics mechanical components or electronic parts are used in this early phase that may no longer be available shortly after completion of the assembly development or may no longer be used due to regulatory requirements this can sometimes have massive financial consequences for the company concerned Such a scenario can only be largely ruled out by intelligent material and component preselection based on continuously updated data regarding all suppliers under consideration Such a procedure is initially associated with a certain amount of additional work However practical experience shows that this like all other proven preventive measures to protect against obsolescence is well worth it especially when considering total cost of ownership Therefore the decisive factor for the success of comprehensive strategic obsolescence management is the greatest possible automation of all the processes required for this for example by using the smartPCN standard That almost sounds like implementing strategic obsolescence management could be the perfect solution for addressing all current and future supply chain challenges Heinbach Iwould be happy of course if it were that simple But unfortunately it is not Strategic obsolescence management is not something static but a continuous dynamic process designed to help minimize obsolescence risks throughout the life cycle of a device or system How well this works in practice with the appropriate commitment always depends on the individual case but the past three years have shown that member companies of the COGD who invested in wellfunctioning obsolescence management at an early stage have generally been hit much less hard by the current crises than competitors who had hoped until the end for a quick return to fully functioning international supply chains In order to remain viable in the long term under what are presumably increasingly difficult procurement conditions forwardlooking consideration and planning are therefore required more than ever The COGD is a German association but obsolescence management must be global What can the COGD do for its member companies at the international level? Wagner Among other things the COGD Component Obsolescence Group Deutschland is a member of the International Institute of Obsolescence Management II-OM With five international chapters and a total of around 500 member companies the IIOM is by far the world’s largest organization in the field of obsolescence management The past three years in particular have shown that a wellfunctioning international networking of all those affected is of enormous importance in the very complex issue of obsolescence This became particularly clear in May of this year at the threeday international IIOM conference in Munich at which the U S Department of Defense among others provided comprehensive insights into its obsolescence strategy When an institution of this size is willing to share its extremely extensive expertise in obsolescence management built up over many decades with other companies concerned the entire obsolescence management community naturally benefits from it including members of the COGD If Iunderstand you correctly the implementation of successful obsolescence management is based on the one hand on the IEC 62402 2019 standard and on the other hand to a large extent on the best practice principle learning and copying from the best in the industry Wagner Ifirmly believe that that a continuous direct and indirect exchange of experience with other companies concerned can greatly benefit the implementation and above all the optimization of one’s own obsolescence management This approach is recommended simply because experience shows that many mistakes can be avoided during the evaluation phase which could otherwise cost the company dearly later on In the case of the U S Department of Defense by the way there is even a publicly available guidebook of best practices for implementing a robust “Diminishing Manufacturing Sources and Material Shortages” abbreviation DMSMS program the standardization document SD-22 published in its latest edition in May 2022 on the basis of IEC 62402 This Department of Defense document shows the five process steps of the management system with the systematics of preparing identifying assessing analyzing and implementing It also provides supporting details and examples of DMSMS activities regarding systems engineering technical reviews independent logistics assess-Dr Wolfgang Heinbach “Strategic obsolescence management is not something static but a continuous dynamic process designed to help minimize obsolescence risks throughout the life cycle of a device or system ” Axel Wagner “With obsolescence management many mistakes can be avoided during the evaluation phase which could otherwise cost the company dearly later on ”