Managing End-of-Life (EOL) transitions of components or products is a challenging business discipline. Some OEMs provide advance notice of product EOL dates, which can alert your company to trigger a transition process. However, sometimes external factors – including technology shortages or supply chain constraints – can shorten or negatively impact transition time.
Addressing the Three Biggest EOL Risks
To address risks, your company should proactively identify and prepare for the three biggest product EOL risks, which include:
- Operational Disruption often results from the staff’s lack of time to support the research, procurement and testing of alternate solutions. In complex industries, the testing and validation of a new component often involves multiple internal and external stakeholders and can take months, often pulling resources from other key projects.
- Financial Loss can occur from an inability to ship product or provide a service. This is a major concern, particularly in regulated industries, where even a minor component change can halt an entire system, and have significant balance sheet implications.
- Customer Loyalty is always tested when a significant product delay or outage occurs. There is often little tolerance from customers, who expect technology to function without disruption, and customer loss is a tangible risk.
Mitigating the “Big 3” Product EOL Risks: Your Change Management Plan
The most effective course of action your company can follow to avoid the “Big 3” EOL risks is to proactively plan for them. The initial step in this process is to ensure proactive notification of upcoming EOL dates. It’s essential to maintain a view of product lifecycle roadmaps; to understand exactly what is in each Bill of Materials (BOM) for each finished product; and to automatically receive notifications at the product, component and accessory levels. As an EOL date approaches, a transition process can be triggered, and a Change Management Plan created.
Your Change Management Plan should address how the component or product change could impact or disrupt the business. It should also include the estimated timeline, and information about replacement options. Often the EOL product or component will have a direct replacement or next-generation option. If a direct replacement is not available, satisfactory options will need to be researched, and supply chain risk and availability for those options will need to be analyzed. Depending on industry regulations and the differences with the replacement product, a re-validation process might be required.
As part of its change management plan, your company should also consider making a last time buy of available stock for an EOL component or product. This can be an effective strategy to bridge the transition and prevent potential business interruption. Last time buys often involved warehousing of the inventory and potential price increases of the component due to limited supply.
How Dynamic Can Help with EOL Risk Management
Managing the “Big 3” EOL risks across multiple products and platforms is a labor-intensive undertaking that requires proactive planning and process management. As an initial step in evaluating EOL risk exposure, Dynamic has created the EOL PrepSM Self-Diagnostic. This tool consists of ten questions that can help your company identify and prioritize specific vulnerabilities and opportunities related to its EOL risks; to understand the complete range of EOL best practices it should follow; and to create a tailored action plan designed to reduce its EOL-related risks.
Dynamic’s EOL PrepSM Self-Diagnostic is available on a complimentary basis to industry professionals upon request, by clicking here. Dynamic provides a broad range of services related to product lifecycle management, including EOL risk management, and is prepared to answer any questions you may have.