The Value of BOM Monitoring in the Production Phase

By Logan Wamsley

There is a misconception that exists in the electronics manufacturing industry that the implementation of BOM monitoring only becomes valuable at a very specific point in an OEM product’s lifecycle — a late point. This could not be further from the truth, and what the one-of-a-kind features of Partstat BOM Monitoring seek to change.

When a critical electronic component or semiconductor experiences a transition toward obsolescence at the behest of the component manufacturer, a sound BOM monitoring system is what informs the OEM that immediate action is needed to avoid significant, and often costly, disruptions. Without such a system in place, it often falls to the OEM and its engineers to determine how to proceed, which usually amounts to little more than trusting the component manufacturer’s notification processes.

Ideally, especially in large-scale manufacturing endeavors, OEMs require at least six months to determine the optimal path forward — whether that’s a last time buy, adopting a comparable alternative, or committing to a full-scale product redesign. The reality, however, is that component manufacturers have historically struggled with providing such a window. Of the millions of electronic components and semiconductors that are obsoleted every year, less than half are accompanied by a Product Change Notification (PCN). Even when a PCN is issued, many come with an immediate last time buy date that the OEM customer cannot reasonably make.

The misconception is that a BOM monitoring strategy alone will be enough for an OEM to circumvent such potential disruptions and give it ample time to pivot its supply chain. While there is inherent value of being notified of the issuance of a PCN, this is an inherently limited view of what a BOM monitoring platform can offer. Not only does this not eliminate the dependency on the issuance on PCNs with reasonable last time buy dates, but it gives the impression that BOM monitoring only holds inherent value in the late stages of a product’s lifecycle.

This needs to change. The true value of BOM monitoring is reached when OEMs accept it as a continuous, ongoing process throughout the entirety of production. Partstat BOM Monitoring reflects this in the use of its complex algorithms capable of analyzing the state of the market for each individual component or semiconductor. By analyzing over 50 billion Big Data points that cover current and historical trends regarding average price, lead times, and inventory quantities, Partstat has the unique ability to predict both obsolescence and allocation issues weeks, or even months, before they occur.

It is important to keep in mind, obsolescence and allocation can be unexpected and premature, occurring sometimes before the component is formally introduced to the market. As the market conditions last year showed, market demand has a powerful effect on the lifecycle of an electronic component. BOM monitoring with predictive capabilities aid the OEM in keeping such sudden market shifts top of mind regardless of how long the electronic component has been in production.

Whether it is 10 years down the line or only a few weeks, continuous BOM Monitoring through Partstat ensures the OEM has the widest window of time possible to determine what is best for its product and its organization.

To learn about how BOM Monitoring is useful for engineers specifically in the design phase, check out this article.