Component Obsolescence Drives Legacy Maintenance Costs

Whenever a design team puts a board into production, everyone seems surprised when obsolete components appear in the BOM. This is totally understandable; design teams don’t have time to scan through every line of their BOM, and not all companies can afford the latest and greatest supply chain data platforms. Over time, obsolescence problems add up, to the point where an entire system becomes legacy and will require significant maintenance to keep operational.

OEMs supply many products that require long operational lifetimes, and these products eventually become legacy systems for which the OEM may be responsible for maintenance. Legacy systems in aerospace, industrial systems, military equipment, and certain parts of the automotive sector are just a few examples where obsolescence can creep into the cost structure for a product. Being aware of the potential problems can help companies determine a plan of action that supports maintenance without excessive overhead.

Parts Obsolescence and Maintenance Costs

Every electronic product eventually becomes a legacy product due to a combination of component obsolescence, product-level obsolescence, wear and tear, and inability to compete with newer products. Simpler devices and consumer products simply get phased out and thrown away; there is no financial incentive for the vendor to support maintenance on these products because users will just purchase replacements. Complex systems with many PCBAs, subsystems, and custom components can’t just be thrown away and replaced.

For these more complex systems, vendors have some level of responsibility to support long-term maintenance, even when the system’s lifetime gives it legacy status. In terms of the supply of electronic components and subsystems, the term “maintenance” can include production and stocking of spare parts or boards, or it can include regular service and maintenance provided by a technician.

A complete list of risk factors and support levels are shown below. All these dimensions of support for legacy systems have some cost element, which is difficult to generalize.

These legacy maintenance requirements are well-known in areas like industrial systems, where production assets may need to have lifetimes lasting multiple decades. Systems could require upgrades, replacement parts (including electronic components and circuit boards), servicing by a technician, or significant maintenance and replacement.

Parts Obsolescence is the Biggest Risk

When we look through the above table, it should be clear that the biggest driver of maintenance needs (and costs) is component obsolescence as this creates component obsolescence and the need for redesigns. Obsolescence occurs in two forms in legacy systems:

1. Product or assembly level obsolescence, where a new product is introduced that is incompatible with a legacy product
2. Parts obsolescence, where important parts in a product go obsolete or EOL, and there are no suitable replacements

Most often, obsolescence starts with components, which can force the redesign of a product that will make the earlier version obsolete. Individual components can go obsolete or EOL with little warning, and a company supporting legacy systems may not get any notification until they try to source parts for a new build. When customers suddenly find they need a replacement product to keep their systems in service, they are in for a rude awakening when the vendor stops supporting their system.

In terms of costs, long-term product maintenance needs could reach 25% of total product overhead. This is one reason vendors may be hesitant to maintain designs for legacy systems. Whenever parts for a legacy system go EOL or obsolete, the design requires maintenance with the old parts swapped out of the assembly. This could involve changing part numbers in the BOM, or it may require extensive design changes in the PCB layout.

Accurate Parts Data Supports Legacy Systems

Although it is a headache to implement a long-term support program, companies have a responsibility to support legacy systems wherever possible. This level of support varies, ranging from embedded application support to replacement boards or sub-components in the system. Some of the cost control measures companies can implement in their service offerings include:

• Clearly-defined service contracts and supply commitments
• Usage of components with many replacements
• A long-term procurement plan that aids product support

To ensure a long-term procurement plan can be put into place, accurate parts data is needed. There are 3rd party services that can help provide this data, including inventory forecasts and lifecycle information across the electronics supply chain. With some of these 3rd party tools and an acknowledgement of legacy system maintenance needs, companies can develop cost-effective strategies for implementing these maintenance plans for their long-term customers.

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