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Forget machine learning, AI, Industry 4.0. Obsolescence is coming fast and in a fury. That should be your focus.

image credit: Universal pictures.
Willian Santos's picture
International Sales Manager ABI Electronics

For twenty years I have been working with small and large international organisations alike enhancing processes related to the test, maintenance, and management of critical electronic assets. My...

  • Member since 2021
  • 4 items added with 2,168 views
  • Feb 16, 2021

The world entered a new era of accelerated transformation in the last 18 months that will continue to evolve and press forward for years to come. Most businesses are playing catch up trying to make sense of a new timeline where the 10 years that had been set aside for careful planning and implementation of what was coming up next no longer exists. The next is happening now and, regardless of your industry or seniority, the status-quo shifted and you better face it. 

Back in 2019, I was invited to attend a pompous meeting in London at the Brazilian Embassy along with selected leading names from the oil and energy to get an update on what was going to happen in the following decade. I could soon spot all the buzz words coming up on PowerPoint slides from the different companies presenting: decommissioning, decarbonization, zero emissions, transition to green energy. Throughout the morning and most of the afternoon, we heard most of these changes would kick in between 2030-35. And I recall a Shell executive pointing out that the business had explicitly concluded that the current income streams were needed to provide the capital required for the transition to take place in due course.

Whomever you talk to in the energy industry in 2021 would tell you to forget about that timeline. Change has come and the transition is happening much faster than anticipated with big businesses scrambling to find the capital to fund all that is required. 

I could go all day talking about how the pandemic and the impact it had on market demand and consumer behavior messed up with the timeline of transport, automotive, defense, manufacturing, and so on. For instance, carrier planes that were due to be retired in 2017 are now required to remain in service at least until 2029. Projects in wind power involving upgrades of wind farms have been scrapped and new installations have drawn huge competition from up and coming brands with operators tending to favor smaller turbines – for being efficient and cheaper to run – and choosing to buy from multiple suppliers instead of just one company. 

Machine learning, AI, industry 4.0 knock at the door. Still, the biggest change yet to be fully appreciated by business leaders is how electronics effectively became the brain of every industrial asset and infrastructure equipment in operation in recent years and how to deal with breakdowns and obsolescence. For instance, I lost count of the many rail connections that I have working in operations and maintenance who struggle with their CME – Chief Mechanical Engineer – who like the role suggests is usually a mechanical-biased individual who may have a less than ideal approach when it comes to the handling of electronic failures. And you guessed it right, less ideal means neither green nor cheap solution as illustrated in this video.

Many decision-makers only realize the problem at hand when it is too late.

"We did not anticipate that the equipment would become obsolete so quickly!"
"Spare circuit boards started to take weeks then months to arrive. Then we were told that they would no longer be supplied. We were quoted 7-figure prices to upgrade our assembly line".

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By deferring the responsibility to the original equipment supplier and other 3rd parties you are bound to be caught off guard soon or later. And the risk exposure from insisting on this strategy is about to get exponentially higher; there is a widespread component shortage increasing lead time and technology providers are dropping support for many products in order to remain viable. Last month, a wind turbine multinational in the U.S recently had to ship a bunch of expensive controller cards used in inverters and speed governing systems to their workshop in Brazil for repair as new replacement cards are not due back in stock for another 6 months. Good job that the local team had an electronic diagnostic equipment BoardMaster from ABI in the shop ready to help the technicians locate the fault and repair the cards which happened in record time.

Poor decision-making when it comes to setting maintenance and repair strategies are often linked to “fake news” and myths such as:

  • A repaired electronic card (PCB/PCBA) will never be as good as a new one.
  • The manufacturer told us that special software was required to troubleshoot the card.
  • Troubleshooting down to the component level is impossible or would take too long.
  • Dedicated test and repair equipment is prohibitively expensive. 

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The mentality here needs to change and fast. The longer you take to embrace the new strategies for in-house fault analysis, maintenance, and obsolescence planning of your key electronic circuits and assets the more expensive it will get to keep them going. Hundreds of leading organizations have found in recent years that the belief in these myths was hindering their results and compromising the operation. From GE Renewable to Collins Aerospace where the latter reduced troubleshooting times on avionics circuit cards from 50 hours to 10 minutes. Then there is LEGO in Mexico where controller cards from 600+ plastic molding machines worth tens of thousands of dollars each have been mapped and are now repaired in-house. In the U.S, an army engineer saved a mobile shelter unit worth 10 million dollars from being decommissioned by repairing its HVAC circuit board that was deemed “unrepairable” by the OEM. In the rail arena, companies like ALSTOM, CAF, Bombardier, and operators like Irish Rail, SFMTA, TCDD and so many others have discovered the benefits of investing in the right tool and skill development program to shield the business against parts shortage and accelerated obsolescence. 

What do you think? How is your business gearing up to face the new challenges in a post-COVID world? 

Matt Chester's picture
Matt Chester on Feb 16, 2021

Thanks for sharing, Willian. What do you think is the best example of this trend on the grid or with utilities, perhaps? What should leaders of these organizations be looking for? 

Willian Santos's picture
Willian Santos on Feb 16, 2021

I think the wind turbine company example above is quite telling. The idea that the equipment supplier will not let you down considering all the industry is going through should be scrapped and fast. Most technical equipment suppliers 1) do not design and make the electronic circuits themselves 2) are not interested in providing long-term economical and reliable repairs. Becoming master of your own destiny is of particular importance now given the uncertain times. GE Renewable is a great example. From having zero capability to do maintenance and repair of inverters and other technologies, in the last 2 years, the company set up 6 labs with engineers trained and equipped to do the job around the world and looking into creating a few more soon. 

Paul Korzeniowski's picture
Paul Korzeniowski on Feb 18, 2021

Interesting points. Yes, new technology does offer utilities the potential to streamline business processes and gain more visibility into their operations. The challenge is -- and always is -- funding. Margins and funding were tight before the pandemic.  They become even tighter after it. What may be needed is a change from traditional financing models to something that fits more with the times, say a Bitcoin like, virtual financing model. Not something that will occur quickly but perhaps something, that will evolve over time?  

Willian Santos's picture
Willian Santos on Feb 22, 2021

That's an interesting idea, Paul! The funding gap has been a hot subject across different industries for decades now. The success stories generally come from businesses that managed to do more with what they had and for longer than their competitors. Investing in positive policies that add healthy years to technological assets is a great way of keeping up with pressures from performance indicators when margins are low. We recently initiated an obsolescence management project involving key electronics-driven controls and automation systems with Entergy in the States that is rendering excellent results. 

Willian Santos's picture
Thank Willian for the Post!
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