Strategies to the Prediction, Mitigation and Management of Product Obsolescence

9.5 MONITORING AND CONTROLLING STAGE

The monitoring and controlling stage is usually called the competition stage and describes problem solving and final control of a project (Olfert, 2008). Applied to comprehensive strategic obsolescence management, this stage is used to define, analyze, and evaluate the costs of obsolescence management, as discussed in the following sections.

9.5.1 Economics of Obsolescence Management Strategies

A decision on the choice of an obsolescence management option should be made based on the life cycle cost impact of initiating and implementing the decision. Information about the immediate piece-part and non-recurring engineering costs is not enough. This section describes some of the factors that play a role in determining the life cycle cost of obsolescence management.

The various affected parties view the costs of part obsolescence differently, and the metrics used to measure the costs vary according to the different interests of the entities involved in the process: the suppliers, customers, and acquisition and regulatory agencies. The cost of managing obsolescence also varies depending on the action taken, from relatively low to very high (see Chapter 7). The process of handling obsolescence can even result in long-term cost savings. The task of the parts selection and management team is to choose solutions that result in the optimal life cycle system cost. The various components to be considered when assessing the cost of obsolescence are introduced ...