The Component Obsolescence Group (COG) was formed in 1997 to promote the awareness of obsolescence risk and the establishment of processes and tools to manage the risk during the lifecycle of long-life support industries such as aerospace and defence.
COG members comprise the whole supply chain: from end users to original equipment manufacturers, CEMs, component distributors and agents, as well as specialist aftermarket suppliers who can source and obtain components that are no longer available from the original sources.
Many companies now have dedicated cells operating obsolescence prediction tools, writing obsolescence management plans as well as resolving real obsolescence issues.
There are essentially two ways to manage obsolescence instances: reactive and proactive. In the reactive scenario we pick up each issue at it happens and fund any resolution at that point.
Proactive management encourages the early identification of obsolescence issues and investment to limit instances and apply long-term support principles. Proactive obsolescence management requires capable staff, integrated tools and dedicated support of the whole business as well as good relationships with all levels of the supplier chain. Applied correctly, proactive management can encourage the consideration of technology upgrades, the generation of spares provision and logistics support.
Over the last thirteen years since COG was formed, the instances of all inclusive through-life support contracts have grown considerably. These contracts require a through-life strategy that starts at design concept, continues through the design and manufacturing cycles as well as the removal of equipment from service and finally disposal. The defence industry has led the way with these types of contracts and the UK MoD has been influential in leading this development, both within its own organisation and through its association with COG and other trade bodies.
It's difficult to assess risk in these instances and the share of risk between the end user and system designer has to be reviewed in each case.
With today's economic climate, there may be a view that we should curtail this investment as it incurs a cost to the business with a difficult to quantify return on that investment. We also need to remember that to downgrade or disband this level of management is firstly a contractual obligation in many cases and will be costly to bring back to its former level when finances improve.
There is an opposing view that if you operate an opportunistic reactive strategy and rely on crisis-led requests for funding, they will be even more difficult to fund given the current financial constraints.
Any decision on strategy should be based on a ‘risk consequence' model which fits the overall business. The investment in proactive management may take years to come to fruition, but the benefit for your business and reputation will enable you to retain existing contracts - and win new ones too.
The 7th COG International Conference on Obsolescence will be held in York in June 2011 and is titled: ‘The Economics of Obsolescence'. The conference and workshop will include around 30 presentations from industry professionals on all aspects of obsolescence management and its impact on their businesses.
Membership of COG enables you to network with over 200 companies primarily in the UK and Germany, but also in ten other countries worldwide including the USA. Our workshop and quarterly meetings enable you to keep your awareness of obsolescence matters current and relevant.
This is no time to downsize the management of obsolescence - particularly as obsolescence instances are expected to grow in the coming years as suppliers rationalise less profitable products, as well as the uncertainty concerning the impact of new environmental legislation that is being considered that will prevent some materials and processes being used in the manufacture of parts.
www.cog.org.uk
