Business continuity is more important to OEMs than ever, but the supply chain industry has long been unequipped to provide it to the level today’s large-scale manufacturers require. Until now.
What is the first industry you think of when you think of vaults? Banks. When it comes to protecting a customer’s monetary equity, banks spare no expense in implementing security systems that make the tech in Mission Impossible look outdated.
Some of these implementations can be expensive, but they are necessary as banking intuitions react to what their customers want — continuity. In other words, when customers put their assets into the bank, they want unequivocal proof those assets will stay there, untouched and unaltered, for as long as they see fit.
Manufacturers are no different. When the decision is made to produce a product with an extended lifecycle, they are willing to take every precaution to ensure that lifecycle is attainable.
Those precautions start with the acquisition and proper care of the critical components necessary to create the product. It’s a simple idea, but unfortunately for manufacturers, the average lifecycle of a critical component is less than half the lifecycle of the product they support. This necessitates a last time buy.
When it comes to last time buys, it’s not a matter of if you need to make one, but when. Virtually all companies at some point are forced to complete at least one last time buy for whatever critical component is approaching obsolescence. Should they fail to make the order before the last time buy date (an increasingly common occurrence for companies without a proper supply chain infrastructure), they might even have to turn to third-party vendors — and pay the exponential markups third-party vendors are known to sticker on discontinued components.
But regardless of how manufacturers acquire the necessary inventory, they then must face the challenge of storing it properly, securely, and safely.
This is a far more complex issue than simply leaving the inventory in an onsite warehouse. These are just a few of the questions that may go through a logistic manager’s mind when making a decision on how to deal with LTB inventory:
• Do we have the capabilities to store and distribute this inventory on our own? And if not, who does?
• Can our profit margin afford to store this inventory on our own?
• Does this LTB require highly-specialized care? If so, are we equipped to provide it?
• Are our storage capabilities prepared to handle any and all unforeseen catastrophes — warehouse fire, natural disasters, political uprising — that may affect our assets?• Can we trust our storage capabilities enough to give us five, seven, or, if needed, even ten years of guaranteed business continuity?
Historically, if an OEM answers no to any of these questions, there is a good chance they will turn to a supply chain partner to store their last time buy inventory.
But here’s the thing: as the storage needs of electronic components, semiconductors, and peripheral products become more stringent and complex, many of these partners have refused to offer new services to meet them and reduce the risks that come with a last time buy inventory purchase.
For example, in an effort to lower production costs (as well as protect their IPs), many OEMs are now turning to the use of application-specific integrated circuits (ASICs), which can be custom manufactured to fulfill a very specific, unique role for a single product. Unlike an assembled component such as a microprocessor or random access memory chip, ASICs can be stored (or “banked”) in basic die and wafer form. Having a critical component in such a basic form can help manufacturers avoid upfront packaging, assembly, and testing costs – but in return, die banking requires storage in highly regulated, climate-controlled conditions until the raw die (in wafer form) is cut into individual die.
Investing in the necessary equipment for die banking is an expense many OEMs simply cannot afford, but the supply chain industry has been oddly slow in adapting their business model to cater to these needs.
These are precisely the kinds of needs EDX’s Custom Storage & Fulfillment Solutions, our latest offering, hope to fill in the supply chain industry — and it all starts with our vault.
For some types last time buy inventory, such as inventory that’s readily available in the open market or is only needed for a short-term lifecycle, there is nothing wrong with standard ambient storage. But what about critical components that are irreplaceable, that, if lost, could force the OEM to redesign their product or, even more costly, discontinue the product altogether?For particularly scarce electronic components, semiconductors, or peripheral products, there’s no such thing as having too much security in the name of business continuity. When there are millions of dollars of downstream revenue on the line, it is absolutely essential that the business strategy created for a product is carried out to the very end.
Our vault is the answer to these concerns. Crafted from state-of-the-art spun ceramic panels and rated as “best in class” for component and raw material storage, this weather-proof, natural disaster-proof, fire-proof behemoth is more than equipped to ensure up to ten years of business continuity.
It’s easy to consider it overkill, but after 26 years in the supply chain industry, we have learned that our customers cannot put a price on long-term business continuity — especially when it depends on sensitive, irreplaceable critical components.
Here are a few of our vault’s key features:
• Fire Rated Class 350 Certification. Our vault has been tested to withstand temperatures well above 2,000 degrees Fahrenheit for over five hours.
• Superior to Concrete Construction. In the case of a fire, a concrete vault will fill with steam as a result of the breakdown of the cement bond. As a result, the atmosphere inside the vault would reach 212 degrees Fahrenheit and 100 percent humidity.
• Zone IV Seismic Rated. With a unique structural steel design, our vault offers three times the strength of a normal building.
• Clean Agent Fire Suppression System. Moisture, as any manufacturer knows well, is the enemy of component integrity. Extinguishing fires with automated sprinkler systems would effectively put out a fire, but at the cost of destroying irreplaceable last time buy inventory. Instead, when our vault detects a fire, it will automatically trigger a chemical suppression system that protects electronic components.
• Magnetic Field Protection. The vault walls and ceiling are enhanced with magnetic shielding to protect against magnetic interference, which can include anything from a common power surge to a lightning strike.
• ECD Dry Cabinets. Die banking requires careful monitoring of the storage area’s humidity levels. Contained within our vault, our ECD SmartDRY™ Cabinets are capable of storing ASICs, die, wafers, and raw materials at a relative humidity as low as 0.5 percent. Comparable nitrogen-based dry cabinets are only capable of achieving 6-10 percent relative humidity.
• 1,100 lb. Vault Door.
State and local governments around the world trust this vault design to protect irreplaceable records, server rooms, and computer equipment, and we’re proud to bring this innovative storage solution to the supply chain industry.
Premium business continuity should not be considered an added expense or burden, but a benefit to those who trust their assets to a supply chain partner like EDX. We owe all of our success to our customers, and as we continue to be a leader within our industry, we plan on offering more supply chain solutions — and more value — to them for years to come.