Strategic Proactive Obsolescence Management Model

When there is a demand larger than the corresponding number of components in stock, obsolescence problems may occur for those systems with a life cycle longer than that of one or more of their components, such as automotive, avionics, military application, etc. This paper discusses the electronic component obsolescence problem and presents a formal mathematical strategic proactive obsolescence management model for long life-cycle systems. The model presented in this paper utilizes redesign and last-time-buy (LTB) as two management methods. The LTB cost is estimated by unit cost, demand quantities, buffer, discount rate, and holding cost. Redesign cost is associated with component type and quantities. This model can estimate the minimum management costs for a system with different architectures. It consists of two parts. The first is to generate a graph, which is in the form of an obsolescence management diagram. A segments table containing the data of this diagram is calculated and prepared for optimization at a second step. The second part is to find the minimum cost for system obsolescence management. Mixed integer linear programming is used to calculate the minimum management cost and schedule. The model is open sourced allowing other research groups to freely download and modify it. A display and control system case study is shown to apply this model practically. A reactive manner is presented as a comparison. The result of the strategic proactive management model shows significant cost avoidance compared to the reactive manner.