Proactive Obsolescence Management in Aerospace and Defense Industries

Electronic component obsolescence is a complex issue for any company, but it can be a significant threat to aerospace and defense operations.

Obsolescence is a part of electronic components that can be overlooked and mismanaged. Obsolescence and the greater problem of component unavailability are a typical part of the electronic components industry. Unfortunately, many organizations can be ill-equipped to handle these challenges.

For some industries, such as consumer electronics, obsolescence occurs more frequently. Quick product evolution cycles due to advancing consumer demands contribute to products going into obsolescence faster. Tech giants at the forefront of the consumer electronics market, such as Apple and Google, are collaborating alongside original component manufacturers (OCMs) to explore new avenues of semiconductor performance.  

To use these new chips, such as the highly anticipated 1.6nm by TSMC, engineers may have to redesign existing systems around them. Of course, for a company like Apple that releases a new phone every year, designing a newer model phone is part of its business model. Many consumer electronics, especially in mobile markets, operate similarly.

Consumer electronics don’t have long shelf lives. In 2023, the global average replacement cycle length for a smartphone is 3.6 years, with nearly half of respondents (40.4%) upgrading their phone every 2-3 years. This timespan can get smaller depending on the country. For example, 43.4% of Chinese smartphone users upgrade their phones every 1-2 years.  

Customers upgrade to gain greater functionality, performance, or security offered by newer products. Since consumer electronics manufacturers are working with shorter product lifespans—with most not extending beyond 8 years--the challenges associated with component unavailability from obsolescence are much different than the problems high-reliability industries like aerospace and defense (A&D) face.  

After all, A&D products have a lifespan of decades in comparison to the few years consumer electronics expect.

Obsolescence Impacts Industries Unequally

Electronic component obsolescence is a supply chain threat. It can disrupt entire production lines, lose sales, and incur redesign costs.  

Demand outpaced supply during the global semiconductor shortage following the initial Covid-19 outbreak, leading to production stalls and suspicious procurement contributing to the rise of counterfeit components occurrences. The most notable example of the semiconductor shortage impact was the challenges automakers faced. With many grappling with lots full of unfinished cars waiting for chip stock.  

For consumer electronics industries, when a part becomes obsolete or unavailable, original equipment manufacturers (OEMs), contract manufacturers (CMs), or electronic manufacturing service (EMS) providers must find a form-fit-function (FFF) alternate, drop-in replacement (DIR), or functionally equivalent part and redesign around it if necessary.  

Most companies would prefer not to redesign, but it is a viable option for most consumer electronics manufacturers.

It is more complicated for the aerospace and defense industry.  

There are three main reasons why obsolescence for A&D companies is a far greater risk than it is for consumer electronics companies:

1. Redesign and Recertification

For a product to be approved for aerospace and defense markets, it must first pass some of the most rigorous certification processes. For example, in the United States, components that will be used frequently in aerospace must follow the Federal Aviation Administration’s (FAA) parts manufacturer approval (PMA) standards for design and production.  

This rigorous approval procedure involves application, risk assessment, engineering tests, verification of installation usability, and several other steps to complete the process.  

If a part becomes obsolete and no alternates have PMA classification, aerospace manufacturers must undergo a rigorous recertification process to utilize an alternate part. Likewise, even if an alternate component has PMA classification, design engineers might have to tweak the systems slightly for the component to work appropriately. That, too, requires certification before going back to market.

Redesigning and recertifying products for A&D markets may take years and millions before approval is given. In a report by McKinsey, “it is estimated that nonrecurring costs for the military aircraft segment alone are in the range of $50 - $70 billion… The challenge of nonrecurring engineering costs is growing worse as technology accelerates and supply chains become more interconnected.”

In comparison, consumer electronics manufacturers do not have the same stringent approval processes before going to market.  

2. Reliance on Mature Semiconductors

Mature nodes are often cheap, yield high, and offer sufficient performance for simplistic devices such as power management ICs (PMICs). Due to their age and low production costs, they are relatively inexpensive compared to advanced nodes. Their sufficient performance in PMICs and longer lifespans make them more attractive than advanced semiconductors, mainly due to the often-stringent market approval processes for high-reliability industries.  

Mature components being relatively inexpensive alongside small order sizes have led to a lack of continued support from OCMs. With the ongoing pace of technological innovation, advanced semiconductors are far more cost-effective for OCMs to support. Many OCMs deprioritized mature semiconductors to focus on lucrative lines during the semiconductor shortage. Some of these components will enter instant obsolescence, where there is no availability to make a last-time-buy (LTB).

An LTB is the solution to combat obsolescence for many companies, especially those in A&D.  

With large LTBs, organizations are expected to store stock for an unknown amount of time until a component needs to be replaced. Unfortunately, this is a costly option. OEMs, CMs, and EMS providers will need a warehouse to safely store their LTB stock from electrostatic discharge (ESD), weather, humidity and other factors that can cause component deterioration.  

Advanced semiconductors do not have the same lifespan as mature semiconductors, degrading even before a decade is up. That is far too short for the demanding requirements in A&D and other high-reliability industries.  

3. Loss of Design Knowledge Among Engineers

Many A&D systems were approved decades ago. Some aircraft still in service were first designed in the 1960s. In many cases, the original design knowledge has been lost over time. When a component becomes obsolete and entirely unavailable, current engineering teams may lack insight as to which FFF alternates or DIRs could fulfill the needs of the component now necessary to replace. Similarly, the internal systems could be impossible for teams to determine quick and cost-effective redesigns without the proper knowledge.

The disappearance of system knowledge over the years is not as great as a challenge as it is for consumer electronics companies. It is found explicitly in high-reliability industries where products are meant to last for decades before the entire product line is retired. Furthermore, these redesigns or alternate components must be able to be retrofitted to all products, such as aircraft, in use. That amount of redesign on all products currently in service is not viable.  

It’s one of the main challenges contributing to the A&D industry's overreliance on reactive strategies such as large LTBs. These high-reliability industries should invest in obsolescence management to make proactive choices as early as the design phase to avoid these complex problems or mitigate their worst effects.  

How to Manage Aerospace and Defense

Thankfully, the A&D industry already has a lot of help in establishing proactive management guidelines for obsolescence.  

In the U.S., the Department of Defense (DoD) requires companies to follow regulations set forth by its management process, the DMSMS SD-26. The DMSMS, or Diminishing Manufacturing Sources and Material Shortages, “is a multidisciplinary process to identify issues resulting from obsolescence, loss of manufacturing sources, and material shortages. The DMSMS requires documentation for the potential negative impacts on schedule and readiness by analyzing mitigation strategies and implementing the most cost-effective approach.”

The DMSMS guidelines aim to help organizations “proactively monitor potential availability problems to resolve them before they cause an impact on performance readiness or spending.”

Establishing DMSMS guidelines often increases the chances for low-cost resolutions through the creation of resilient and sustainable designs early in product development. These guidelines can streamline case management processes, which are imperative during obsolescence or component unavailability. Proactively setting up case management can help organizations prepare for the downtime and costs they may incur during unavailability or obsolescence.

A&D OEMs, CMs, and EMS providers should assess designs and identify shortage-prone components to remove them as early as the design phase. This helps make products more resilient against component obsolescence and unavailability. Engineers should replace problematic components such as sole source parts with multi-source available components.  

This can be accomplished with market intelligence tools that collect real-time data on historical transactions, trends, and other market factors to alert engineers to risky components in their bill-of-materials (BOMs). With alerts, engineers can avoid problematic components during development and identify better options for new and existing designs.  

Sourceability Can Help Aerospace and Defense Manufacturers Combat Obsolescence

Electronic components distributor Sourceability has the tools to help organizations combat obsolescence problems. AS6081 certified, Sourceability’s global team of experts can provide aerospace and defense OEMs, CMs, and EMS providers with hard-to-find components.

Additionally, Sourceability’s market intelligence tool, Datalynq, is equipped with comprehensive part data and market availability for components based on real-time information from Sourceability’s premier e-commerce site, Sourcengine. Datalynq uses a 1-to-5 scoring system to rate components’ risks in several areas of concern, including multi-source availability and design. These scores determine a component’s overall risk, helping engineers decide whether to use a part.

Datalynq’s case management documentation tool follows the DMSMS SD-26 guidelines for proactively tracking cost avoidance, generating compliance reports, and creating and managing cases for issues. Once you’ve initiated a case within Datalynq, all your pertinent case information is documented in an audit trail.  

On Datalynq, users can document the expected impact date, the case status, the government case number, and, if necessary, the number of days production will be affected, the impact rate of logistics and repairs, and more. You can also add information for potential resolutions, their cost, a summary of the mitigation plan, and even the confidence of how this mitigation strategy will work.

Furthermore, Datalynq has been integrated into the Cadence OrCAD X platform, helping design engineers remain aware of component risks with timely alerts based on real-time changes. This can make it easy for an organization to pre-emptively remove problematic components or begin a case for obsolescence-risky parts within a product’s design.

If you want to see how easily Datalynq’s case management system can help you with component obsolescence, Sourceability’s experts are here to help. Ready to get started managing obsolescence? Contact our team today.  

Author of article
Kathryn Ackerman
Kathryn Ackerman is a senior copywriter with experience in the electronic components and tech industry. She works alongside Sourcengine's experts and engineers to provide the latest and most accurate updates within the electronic components industry.
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