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AUGUST 2024

Semiconductor Obsolescence

 
web-faq1In the semiconductor industry, obsolescence is a constant challenge that manufacturers face. As technology advances at a rapid pace, older materials and components quickly become outdated and no longer meet the demands of the market. This can lead to shortages in supply and difficulties in sourcing essential parts for semiconductor devices. Different types of obsolescence, such as technological, fit, legal, and form obsolescence, present unique challenges that companies must address to stay competitive. To tackle obsolescence effectively, companies must have a formal obsolescence management plan in place, carefully monitor suppliers, and consider long-term inventory buys.
 
By staying ahead of obsolescence issues, semiconductor manufacturers can ensure their devices meet performance, reliability, and cost objectives while staying competitive in the market.
 
Q:  What is obsolescence?
A:  
  • The process of becoming  outdated and no longer used or available
    • Part is obsolete and not available in market - obsolescence
    • Part shortage and diminished availability –  not obsolescence
    • Shortage of suppliers is not obsolescence
 
Q:  What are the different types of obsolescence? 
A: 
  • Technological Obsolescence:
    • Technology is obsolete and does not allow supply chain to continue
    • Generation change (Moore’s Law)
  • Fit Obsolescence - The device functionality has changed and will not support the project need
  • Legal Obsolescence - IP expiration, non-renewal of IP or manufacturing agreement
  • Form Obsolescence - Example: parts are not available in same package
  • ROI Obsolescence - Cannot produce the device profitably / low volume
 
Q:  What are some best practices to tackle obsolescence? 
A:  
  • A formal obsolescence management plan/org is a must
  • Company’s parts, material and process (PMP) plans need to address obsolescence
  • Plan! Plan! Plan! Planning is key for obsolescence management
  • Have a good parts management database system
  • Consider replacement options/choices
  • Qualification is a key consideration for high reliability applications
  • Careful consideration should be given to the alternate package technology
  • Evaluate and monitor your suppliers for obsolescence
  • Consider long term buy inventory
 

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