This month, Verical.Connect and EPS have taken a very close and important look at the cornerstones of quality and anti-counterfeiting strategies in the semiconductor and electronics supply chain. Sourcing and procurement have grown, expanded, and decidedly matured in terms of business operations/processes as well as the role that these departments play in the corporation. Quality assurance is part and parcel of achieving strategic goals and market leadership position, hence sourcing best-in-class electronics parts is front and center.
Traceability is certainly seen as a lynchpin in quality assessment standards today, but it is not always as simple to execute, as Barb Jorgensen recently discussed for Verical Connect. Unique marking of parts continues to pose a variety of problems, as recently reported by Russ Arensman, and has not been as successful due to these problems. Provenance, or the full life-cycle ownership history of a part, is critical in ensuring quality. Knowing not just the origin, but also the path from the manufacturer through to your loading dock speaks of the ability to control quality, ensure proper storage and handling. Counterfeiting is not alone in the quality problems facing the industry; sub-standard parts pose real problems.
So how can companies best ensure the quality of the parts they are sourcing? Sourcing from authorized (franchised) suppliers continues to be a first-line strategy employed by business, and mandated by NDAA and DFARS rulings for contracting with the U.S. government, particularly with the Department of Defense (DoD). However, sometimes that is not possible such as for obsolete (EOL) parts that are not always available through these channels. Traceability requirements do vary depending on the type of part and who is sourcing. The tightest (and arguably “gold”) standard is sourcing for the U.S. government military and aerospace electronic parts and subassemblies. The goal of these very detailed provenance data are to ensure not only the origin of the parts but also to ensure the parts meet or exceed quality standards and have not been degraded under transfers.
As discussed earlier this month pertaining to NDAA and DFARS rulings, the requirements for DoD contracts demand first sourcing through authorized channels, when facing EOL sourcing situations and parts no longer available, then it is permissible to source from a strictly defined set of other trusted suppliers, as discussed earlier this week.
As we conclude September’s review of the latest issues in counterfeit mitigation and related best practices, the tightening requirement by DoD underscore that who one sources from is a frontline, proven strategy. The importance of defining who such “trusted suppliers” is among the impetus behind the latest round of DFARS definition tweaks, as we saw with the 9/21/15 proposed ruling. The new, tighter definition for “trusted suppliers” are proposed as follows:
Trusted supplier means—
(1) The original manufacturer of a part;
(2) An authorized dealer for the part;
(3) A supplier that obtains the part exclusively from the original component manufacturer of the part or an authorized dealer; or
(4) A supplier that a contractor or subcontractor has identified as a trustworthy supplier, using DoD-adopted counterfeit prevention industry standards and processes, including testing (see https://assist.dla.mil).
Given the increase in demands on sourcing, not just in terms of counterfeit mitigation but also in business strategy requirements, how are today’s critical sourcing and procurement departments to ensure that all of the best-in-class standards, processes and procedures are followed by their sourcing partners? Beyond time-consuming due diligence and on-site auditing, sourcing from on-line, authorized marketplaces, such as Verical.com, provide just this type of security. Authenticity of parts coupled with reliable availability, pricing, and warrantee ensures the confidence and quality needed when procuring electronics globally in real-time.