Can you accelerate the selection of alternate components?

This blog was written by Chad Jackson, Chief Analyst & CEO at Lifecycle Insights, and comments have been provided throughout by Stephen Chavez, one of our own product marketing managers. Check it out and join the conversation below!

Today’s electronics manufacturers must work on tight schedules to remain competitive. Any delays in product delivery or launch can lead to significant—and sometimes unrecoverable—financial impacts to the company. Late-stage electronic component replacement is a major cause of such delays. When companies are forced to replace a part late in the game, they often act desperately, paying a premium to source an acceptable substitution. But organizations do not have to be held hostage to late-stage spot buys. By implementing a resilient, connected supply chain approach, they carefully consider or altogether avoid disruptions before costs run too high.

Delays due to costly late-stage electronic component replacement

Late-stage component replacement is an increasingly common problem. A full 73% of respondents to Lifecycle Insights’ 2022 Electronics Design for Resilience (EDfR) Study reported they must remove at least one electronic component from each printed circuit board (PCB) design due to supply, lifecycle, or compliance issues. Some stated they need to replace components an astonishing 20 times or more per board project.

These electronic component replacements not only cause significant delays but are incredibly costly. Some of the potential expenses include:

• The time required to locate and approve replacement parts;
• Additional premiums on component costs associated with late-stage spot buys;
• The time and resources associated with PCB design rework and validation when component footprints are different;
• The need to re-collaborate with mechanical engineers and create new deliverables with mechanical computer-aided design (MCAD) tools;
• The PCB fabricator’s ability to pivot in the face of a new design and deliver the updated board when schedules are already at capacity; and
• Postponed product delivery and time to market (TTM) dates.

The necessity of supply chain collaboration

Efficient, cost-effective PCB design depends on the ability to select components at the onset of the project based on real-time supply data for availability, pricing, and performance. When organizations can do so, they avoid delays as well as any unknowns that come with the use of a traditional, linear, sole-source flow for parts. Lifecycle Insights’ EDfR Study found that 76% of organizations have moderate to high difficulty getting notifications when a component is no longer (and often unexpectedly) out of stock. When specified parts are no longer available, and there is no pre-approved alternate, companies must rely on spot buys. These spot buys from component suppliers and PCB manufacturer stock rooms can be extremely costly, impacting profits.

Successful PCB design and verification is a collaborative effort. It is very common for data to be exchanged between electrical computer-aided design (ECAD) and MCAD platforms. When a design component must be replaced with an alternate part, engineers must consider multiple factors. For example, engineers must compare the unavailable part to other models previously used. This will help to ensure the design will meet, for example, the required height for the product assemblies and still pass clearance rules.

PCB fabricators typically have limited capacity—and are locked into adhering to strict schedules to meet all of their customers’ expectations. When electronic component replacement issues arise, the design project will halt until issues are resolved. In a best-case scenario, that production stop is limited to a single component replacement. In the worst case, the entire PCB design will need to be modified. This will involve a board revision, repeating pre-fabrication design for assembly (DFA)/design for manufacturing (DFM) verification checks, and recreating fabrication data files. All of this will delay the fabrication start. That means that everything associated with the product launch will be impacted, including revenue.

More than half (52%) of respondents to Lifecycle Insights’ 2022 EDfR Study reported that their company revenue was impacted by sourcing issues. The costs add up. For example, changes to a pre-scheduled marketing campaign could have a price tag in the millions of dollars.

How automation accelerates alternate component decisions

Supply chain intelligence provides real-time component data to help companies make appropriate selections for alternate parts at the very beginning of a project based on accurate parametric, compliance, pricing, and supply data. Supply chain intelligence also gives companies the ability to perform the analyses necessary to make appropriate pricing and fabrication trade-offs. Then they can ensure that any disruption will have a minimal impact on the product launch schedule.

Organizations can select alternate components based on package data and land pattern dimensions that are within design specifications. This eliminates time-consuming and costly design respins should the preferred component become unavailable.

Having a design flow strategy that supports supply chain intelligence at the point of design can help ensure a more resilient supply chain. When engineers have intelligence that allows them to consider component alternates at the earliest stages and then throughout the design phase, companies are in a better position to meet deadlines. They can be more confident that product delivery will stay on plan and within budget.

Intelligence for more resilient supply chains

Today’s electronic manufacturers are working with an uncertain and volatile supply chain that can negatively impact schedules, costs, and product launch plans. As a result, late-stage component replacement is an increasing problem in PCB design. Robust, real-time supply chain intelligence can help. When companies can implement such intelligence through deployment of a digitally integrated multi-domain supply chain solution, they can mitigate supply disruption from the earliest days of design. This supports better collaboration between manufacturers and suppliers, and also provides key intelligence that will help manufacturing organizations avoid costly and unexpected late-stage respins.