Counterfeit Components: A Method to Identify and Manage Risk for the Government Contracted Manufacturers and Challenged Small Businesses

Abstract

Counterfeit electronic components have been infiltrating the electronics supply chain and as a result many manufacturer restrict their purchased to authorized distributors or original component manufacturers Military manufactures also require authorized distributors and original component manufacturer (OCMs), but need to support older systems that use obsolete parts or resold parts forcing them to purchase parts from other sources. Most small disadvantaged suppliers are not authorized distributors or OCMs and have difficulty selling material to military manufacturers. In addition, military manufacturers have obligations to use disadvantaged suppliers, but do not want the risk associated with non authorized dealers.

This research paper develops a method to identify risk associated with small disadvantaged suppliers and gives both the manufacturer and the supplier a risk assessment to grade suppliers. With this information a military manufacturer can evaluate each supplier and quantify risk associated with that supplier and compare it to other suppliers. The evaluated supplier has a list of fault modes that can be prioritized and used to improve its position against other suppliers. The result is that each company is examined in nine categories and a numeric risk level associated with each category are established and documented. Both the manufacturer and the supplier have a quantifiable record to communicate with each other.