Counterfeit components are becoming more sophisticated. Over the last few years, counterfeiters were given a golden opportunity to slip their ill-begotten wares into the electronic component supply chain during the height of the global semiconductor shortage. How much counterfeiters cost original equipment manufacturers (OEMs), contract manufacturers (CMs), electronic manufacturing service (EMS) providers, and others is still unknown. It’s likely to be in the billions.
While component obsolescence and supply chain disruptions are significant threats to the electronic component industry, the danger that suspect counterfeits pose reigns supreme. Over the last decade, there have been several instances of major counterfeit occurrences in the United States. This shows that even domestic markets can be prone to counterfeits. Traditional methods of counterfeit avoidance, such as purchasing from suppliers outside of China, are hardly acceptable approaches to mitigation. Counterfeits can appear anywhere nowadays.
The Electronic Resellers Association International (ERAI) said that 66.9% of parts reported to the organization in 2019 that were deemed counterfeit came from companies outside of China. The Defense Advanced Research Projects Agency (DARPA) has estimated counterfeits cost the electronics industry $170 billion. The Semiconductor Industry Association (SIA) estimated counterfeits cost the semiconductor industry $7.5 billion.
Aside from revenue loss, counterfeits pose significant threats to life and national security. Should a component fail to perform to its purported specifications, its failure could be anything from a minor inconvenience or the collapse of critical life-supporting equipment. Keeping non-conforming parts out of the electronic component supply chain is a united effort by all industry members. Steps must be taken to prevent your company from falling victim to counterfeits and protect your clients from becoming victims as well.
The best way to ensure safety against nonconforming, suspect counterfeit, or counterfeit parts is through certification, if your organization distributes parts, and purchasing from suppliers with the appropriate certifications if your organization procures them. When purchasing components, be on the lookout for four key certifications every distributor should possess.
The International Organization for Standardization (ISO) is an organization that develops international standards and guidelines through the consensus of global subject matter experts and stakeholders. ISO guidelines and requirements are used for products, processes, services, and systems to help guarantee quality, safety, and efficiency through structure and flexibility. Established in 1947, ISO has published over 20,000 international standards that cover almost every industry sector, from manufacturing to healthcare.
This includes creating standards for electronic component quality management systems (QMS).
ISO 9001:2015 is a standard that established the criteria for a quality management system to ensure products and services consistently meet customer and applicable statutory and regulatory requirements. This is the international standard for organizations and the most well-known certification. Over one million companies and organizations in 189 countries are certified to ISO 9001:2015. Organizations certified with ISO 9001:2015 state that the guidelines set forth by the standard aid them in process organization, efficiency, and future improvement.
Based on plan-do-check-act methodology, the process-oriented approach in ISO 9001:2015 calls for process documentation and reviewing structure, responsibilities, and procedures to maintain excellent quality management. ISO 9001:2015, or the 2015 revision, placed further emphasis on risk-based thinking to enhance process approaches in a company’s QMS.
Critical to establishing a robust QMS, companies that lack ISO 9001:2015 should be approached with extra scrutiny. Since it is an international standard, buying from a supplier without it is unadvised.
Also established by ISO, ISO 14001:2015 covers and specifies the requirements for an environmental management system that organizations can use to enhance environmental performance. ISO 14001:2015 helps companies manage their environmental responsibilities systematically and is meant to provide value for the environment, the organization, and other interested parties. These requirements help push for further sustainability.
ISO 14001:2015 benefits organizations by aiding a company in improving environmental performance, fulfilling compliance obligations, and achieving environmental objectives. This certification applies to “any organization, regardless of size, type, and nature, and to the environmental aspects of its activities, products, and services that the organization determines it can either control or influence considering a life cycle perspective.”
Unlike ISO 9001:2015, ISO 14001:2015 can be used in whole or in part to improve a company’s environmental management systematically. Organizations can base their environmental rules and regulations on ISO 14001:2015’s different sections and still positively move in a more sustainable direction without implementing all requirements. However, this does not mean companies that only incorporate portions of ISO 14001:2015’s requirements can achieve complete conformity.
To claim true conformity to ISO 14001:2015 standards, an organization must implement all requirements listed within its guidelines. There can be no exclusions.
While ISO 14001:2015 is not a make-it-or-break-it certification should an organization not comply with total conformity, it is a critical standard as the industry further embraces sustainability. Currently, the semiconductor industry continues to push for decarbonization and sustainable manufacturing across all processes. Possessing ISO 14001:2015 proves that a manufacturer is doing all they can to ensure the quality of the components they distribute and their processes.
ISO 9001:2015 is a certification that forms the foundation a company should utilize to ensure quality, while ANSI/ESD-S20.20-2021 helps protect components and those who handle them. The ANSI/ESD-S20.20 certification covers the requirements to design, establish, implement, and maintain an Electrostatic Discharge (ESD) Control Program. This is to protect “electrical or electronic parts assemblies and equipment susceptible to damage by electrostatic discharge greater than or equal to 100 volts Human Body Model (HBM), 200 volts Charged Device Model (CDM), and 35 volts on isolated conductors.”
Unlike ISO 9001:2015, this certification is more specific as it requires distributors and other electronic part suppliers to have controls to protect equipment prone to electrostatic discharge, technicians working on such equipment, grounded areas, and other measures. Each one of these protection methods or controls must be held to ANSI/ESD-S20.20 certification standards.
The American National Standards Institute (ANSI) developed this multi-industry standard to reduce damage through proper ESD control, replacing the previously used certification MIL-STD 1686. Most major industries, telecommunication, automotive, and medical devices, prefer ANSI’s certification. The National Quality Assurance (NQA) global certification body states, “the telecommunication industry standard TL9000 references S20.20 as a best practice for meeting ESD control needs.”
While this certification does not weed out counterfeits the same way ISO 9001:2015, it helps prevent the deterioration of electronic components, leading to future nonconformance. This continues to ensure the quality of electronic components.
One of the most essential certifications a distributor or electronic component supplier can possess is the Society of Automotive Engineers' (SAE) Aerospace Standard (AS) 6081, more commonly known as AS6081:2012. SAE AS6081Counterfeit Electronic Parts: Avoidance, Detection, Mitigation and Disposition for Distributors is “the SAE aerospace standard that presents standardized practices to identify reliable sources to procure electrical, electronic, and electromechanical (EEE) parts, assess and mitigate the risk of distributing suspect counterfeit or counterfeit EEE parts, control suspect counterfeit or counterfeit EEE parts, and report incidents of suspect counterfeit and counterfeit EEE parts.”
AS6081’s counterfeit mitigation process ensures that OEMs, CMs, and EMS providers in high-reliability industries are purchasing from distributors that comply with the rules and regulations that safeguard companies from suspect counterfeit parts. AS6081:2012 requires certified distributors to report and control substandard parts for the prevention of future recurrences of counterfeit components.
SAE AS6081 can be broken down into four key sections:
Recently, the certification was revised to improve the language within the original 2012 release. This revision, AS6081A or AS6081 Appendix A, addresses new challenges and the industry’s evolution by broadening its application to include more organizations that procure and distribute electronic components by distinguishing independent distributors, brokers, and others previously excluded.
More significantly, the expanded scope of AS6081A now “strengthens risk assessment, improves reporting requirements, optimizes supply chain traceability, enhances testing methods, updates training modules, and develops cybersecurity aspects—all to promote avoidance, detection, and mitigation of counterfeit electronic components.”
Organizations with AS6081:2012 certification possess some of the most robust quality management systems to comply with high-reliability market guidelines. While AS6081 is not a certification required for consumer markets, seeing a distributor do whatever they can to prioritize quality in any aspect ensures counterfeit risk when procuring parts is low. A further action that can safeguard buyers against counterfeits is if a distributor is a member of an organization that actively tests new methods to protect against sophisticated fakes.
The ERAI is a global information services organization that “monitors, investigates, and reports issues affecting the global electronics supply chain.” This, of course, includes counterfeits.
Furthermore, ERAI provides exclusive services and in-depth information that “enable its members to perform industry-specific risk mitigation on suspect counterfeit, high-risk, and non-conforming parts and identify problematic suppliers and customers.” The list of ERAI members is vast, including aerospace, defense, medical, nuclear, and commercial organizations. Reports from ERAI members have helped create the world’s largest database of suspect and nonconforming electronic parts to help industries research, track, identify, purchase, and sell materials.
Using these tools, OEMS, CMs, EMS providers, and others can better mitigate risks within their procurement processes, especially during supply chain disruptions, end-of-life (EOL) notices, or component obsolescence. The ERAI counties to partner with other leaders within different industries to improve counterfeit detection and mitigation techniques, a task Sourceability is all too glad to contribute to.
As a member of the ERAI, Sourceability continues to improve upon existing detection, avoidance, and mitigation techniques to lower the risk of counterfeit components. Certified in all of the above standards, Sourceability works ceaselessly to remove the risk of nonconforming or counterfeit parts from the electronic component supply chain. Keeping up to date with the latest certifications to ensure quality is of the utmost importance for any electronic component distributor, especially post-global shortage.
Want to learn more about our certifications and documentation? You can contact Sourceability’s industry experts any time for more information; just reach out here.