DCA/EPTAC Lead-Free Seminar Series 2005

DCA and EPTAC are continuing our highly successful and acclaimed "Lead-Free" seminar series in 2005 around the US. Occurring monthly in different parts of the country, the series is backed by the combined muscle of CMP Media (Publishers of Electronics Supply & Manufacturing and EE Times), TTI (the global leader in passives and interconnect distribution), and UP Media (Publishers of Circuits Assembly and Printed Circuit Design & Manufacture).

We realize there are many seminars being given out there. Most, if not all, are being given by companies that want to sell you something and offer you a narrow perspective on the topics of RoHS and WEEE (if they even cover both).

We offer the broadest, most comprehensive seminar on what your company (not just your engineering department, and not just your manufacturing department) has to do TODAY as well as in the future to comply with coming material restriction and product take-back and recycling legislation and requirements. We provide an unbiased, independent, objective overview of all the technical and business issues that impact Electronics OEMs. The part numbering and part-level compliance issues are important, no doubt. But an understanding of the impact on your company's legal risks, warranty and contracts (with both suppliers and customers), design for environment and recycling, take-back, spares, product reliability, supplier selection and management, component selection and management, board and system assembly and rework, software systems, and financial systems is something you'll only get at the DCA/EPTAC "Deadline to Lead-Free" seminar.

The remaining schedule is:

Dallas, TX: May 10, 2005 - Includes a component manufacturer roundtable!

Houston, TX: May 12, 2005

Chicago, IL: May 19, 2005

Boston, MA: May 25, 2005 (Our March seminar sold out!)

Detroit, MI: June 16, 2005

We will be announcing a follow-on series of seminars soon. Stay tuned! In the meantime, see below for other events.

WEEE: The Moving Target

If you haven't begun to address WEEE yet, then you have little time left before you are risking legal penalties. Here are two key things you must do in the short term:

Register in Each Affected EU Country (and in some cases, each Region) by 12 August 2005
Mark products with the WEEE symbol that are put on the market as of 13 August 2005.
Obtain EN 50419:2005, "Marking of electrical and electronic equipment in accordance with Article 11(2) of Directive 2002/96/EC (WEEE)", for a precise definition of the requirements.

Note that the UK has postponed implementation of WEEE, except for the marking requirements.

For products you ship to OEM customers, your customers may be asking you to contractually cover the costs of recycling your portion of their end-user product. Likewise, if you incorporate OEM products in your systems, you may want to address this with your suppliers.

This comes from the WEEE Guidance document on the DTI Website. Bookmark it!

Germany has posted it's draft WEEE Legislation here. An interesting twist is that design for reuse is seemingly required: "Producers should not prevent [electrical and electronic equipment's] reuse through specific design features or manufacturing processes, unless such specific design features are required by law or the specific design features or manufacturing processes present overriding advantages, for example with regard to the protection of human health and the environment or safety requirements."

Ireland has also published it's draft legislation. Visit the Department of the Environment, Heritage and Local Government for more information.

Partner Spotlight: Symphony Consulting

Symphony Consulting and Design Chain Associates have partnered to deliver an end-to-end, one-stop shop, RoHS solution that addresses both the design chain and supply chain issues.

Although July 2006 is more than a year away, the aggregate lead-times and the planning time associated with this transition leaves little to no cushion. The end result of delayed planning or poor execution will increase the risk of bad publicity and lost revenues.

Bijan Dastmalchi, principal of Symphony, recommends that you Develop an inventory strategy to facilitate the transition. We all know how difficult it can be to plan just the right amount of inventory when a product becomes obsolete and a replacement product takes its place. Under-plan and you risk revenue shipment; over-plan and you end up with excess inventory. The same concept applies in RoHS only on a much larger scale.

The transition to RoHS compliant components and processes has the makings of a supply chain "perfect storm". Anyone that has had to manage a tricky product transition knows the precarious balance needed to make everything stop and start smoothly. Now imagine thousands of companies, with thousands of components suppliers, working through multiple contract manufacturers and distributors all trying to make the transition in the next year.

At the product level, you need to make sure that you have a clearly defined transition roadmap based on where you products are in their lifecycle relative to the July 2006 deadline. At the component level, you must define how much of the older, non-compliant parts you need to ensure continuity of supply until your transition or obsolescence date arrives. In parallel, you must also define the quantity of the compliant, or "lead-free", parts that you must secure for your future production requirements. Keep in mind that other OEMs - particularly the larger ones - are racing to secure the limited inventory of the existing parts as well reserving capacity of the lead-free parts as they roll off of the manufacturing line. And then there is the issue of spare parts, for which you must retain records to ensure that your non-compliant spares are shipped only to support product shipped before the July 2006 deadline.

If you are facing these inventory challenges and need expert assistance, contact Bijan.

Material Declaration: How much is too much?

You'd think we were asking the world of our component suppliers. "What's your part made of?" seems to be a very difficult question to answer in many cases. Some suppliers can provide exhaustive detail, some deliver fairly generic information, still others limit it specifically to RoHS materials, some are only willing to say "yes" or "no", and an unfortunate few are completely incapable of answering the question (run from these suppliers NOW!).

But what's really needed, and why? We believe there are two answers to that question.

First, and at this point in time foremost, is the requirements of your own corporate supply chain due diligence. Understanding just how much your suppliers and their suppliers understand the requirements of RoHS and other environmental requirements is paramount at this point in time. OEMs are in the process of making sure their supply chains will enable them to be compliant by July 1, 2006. So requests for material composition and material declarations of compliance at this time are really to support the need to create a compliant supply chain. Suppliers unable or unwilling to share this information with their customers risk losing them.

Second, and of significantly less importance today but of critical importance as of July 1, 2006, is supporting documentation for legal inquiries. There is no RoHS compliance certificate required at customs, or required for selling product in the EU after 7/1/06; by "putting product on the market" after that date, companies are self-declaring compliance. But should you get targeted (possibly through the actions of a disgruntled employee, a competitor, or an NGO), a possible legal defense is explaining why you believe your product to be compliant. That includes, we believe, significant supporting evidence.

But even so, do you need complete material declarations for that event? We don't believe so. The laws of the EU only restrict six substances; they effectively don't care about the rest. This is where a significant disconnect lies in the battle between what customers want today, and what quite a few component suppliers are willing to deliver.

Both OEMs and their supply chains should realize and understand that this is not the end of material information requirements, or of restrictions on certain hazardous substances. Proposed directives exist that we believe will require more extensive disclosure of material composition in certain applications, and for additional applications of due diligence (i.e., product definition and design) in the future. A compromise on delivering adequate material composition information to support all forms of due diligence, and protection of intellectual property, is required.

More on this, and considerations in managing it all (hint: don't leap in to long-term contracts!), in future newsletters.

More Upcoming Events

Design for the Environment: One Hour Webinar, April 27, 2005 - 1:00pm EDT/10:00am PDT
Michael Kirschner from DCA and Richard Paul from Omnify Software present what you need to know about RoHS and WEEE, the impact on your business, and what to look for in PLM software that can support legal and engineering requirements.

EDS 2005, May 4 2005 - Las Vegas, NV
Michael Kirschner discusses Beyond RoHS - How to Create Competitive Advantage. If you thought that RoHS was the end of Green Compliance, think again. Hot on the heels of the EU’s directive on the restrictions on the use of certain hazardous substances (RoHS) are a series of other green directives in the works in the EU as well as a host of legislative, regulatory, and company policies emerging around the world, including in the US. All of them will have an impact on your business. Come and learn how your company, your suppliers and your customers can turn a regulatory headache into a green competitive strategy. Presentation by Michael Kirschner, President of Design Chain Associates, plus discussion and Q&A with a panel of your peers.

2005 Expandable Users Conference, May 24 2005 - San Diego, CA
Michael Kirschner discusses Prepare To Be Regulated! Lead-Free, Recycling, and Competitive Advantage.

The European Union has been leading the world-wide drive for the electronics industry to become more environmentally friendly. Through directives like Restriction of Hazardous Substances (RoHS) and Waste Electrical and Electronic Equipment (WEEE) we are being asked (or told) to design product differently and to manage the entire product lifecycle from an environmentally conscious perspective.

Supplier and component selection is no longer just a supply chain issue; it now becomes a potential legal and market issue as well. How does this impact product design? What are the data management issues? What can you do to make sure your products comply? How can your company turn this into a competitive advantage? Michael Kirschner of consultancy Design Chain Associates walks you thought the challenges and opportunities.

DCA In The News

April 1, 2005: The Next Big Design Challenge. Electronics Supply & Manufacturing Magazine. [D]esigning for the environment will become a major issue as countries set strict recycling and reuse standards and limit the use of harmful materials. Companies that get ahead of the curve will have a competitive advantage.

March 10, 2005: Electronics, unleaded: Environment: New European rules will force electronics firms to eliminate toxic substances and take back and recycle their products. The Economist.

March 1, 2005: Making progress: A new ESM survey finds industry awareness of-and preparedness for-environmental legislation is on the rise. Electronics Supply & Manufacturing Magazine. Update of the July 2004 survey.

February 27, 2005: Component compliance: Manufacturers start phasing out solder containing lead. San Francisco Chronicle, page E-1. "People in the industry are talking about a cost of 1 to 3 percent of revenue" in compliance costs ...

February, 2005: Executive's Guide to Compliance with RoHS. Start Magazine. Article by DCA; available in print only.

Contact and Feedback

We value your feedback and insights on the topics in this newsletter and others. You can contact us toll-free at the number below, or simply reply to this email.

Best Regards,
Michael Kirschner

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Design Chain Associates LLC

www.DesignChainAssociates.com