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January 2016 • SMT Magazine 69 to counterfeit materials are discovered, usually late in production as a quality issue, there is of- ten no way to track back to when and where they were introduced. This tracking problem has a historical ele- ment. In the early days of electronics manu- facture, the quality of materials was relatively poor while volumes were ramping up with the popularity of electronic technology products. As a result, the quality of products in the mar- ket was low, and reputable manufacturers need- ed extensive incoming inspection regimes for many of the materials they used. The cost of this inspection was high, but the cost of mar- ket-quality issues was higher. However, neither of these high costs could be sustained as compe- tition between electronics product manufactur- ers intensified. As a result, quality assurance was pushed upstream, and companies worked with their materials suppliers to manage quality and provide assurance of supply. Over time, mate- rial-related, market-quality issues were reduced, and with it the need for incoming inspection in the majority of cases. But now because of the increase of coun- terfeit materials in the supply chain, the call is once more being made to set up incoming in- spection regimes. What has been found so far is of real concern. While many batches of ma- terials have no appreciable quality issue, some batches exhibit a failure rate that ranges from a few percent to as high as 10%. On further inspection, some discrepancies can be seen in the materials' appearance. Careful inspection of the materials for colors, fonts, lead geometries, package material and orientation, box materi- als, and labeling can reveal inconsistencies. In some cases, the counterfeit materials are hid- den by mixing them in with genuine materials. In one case, a reel of SMT materials was found where approximately every seventh component on the reel was counterfeit. Reportedly, counter- feit materials are coming from both franchised and grey-market sources. With this amount of counterfeit material, the industry will face a sudden, steady increase in production-quality and, potentially, market- quality issues or a significant increase in the cost of incoming material inspection. Today, however, with the increasing use of electronics in safety-critical operations, such as automo- tive, medical, industrial, aerospace, and mili- tary equipment, the potential results of issues will certainly be far more serious than in the past. The industry will be forced to increase the inspection of more materials, inevitably raising costs. Rather than simply letting history repeat, we must take action now to change the supply- chain environment so that this proliferation of counterfeit materials does not continue. Conclusion After examining our detective scorecard, we can see that it's not practical to try to change the motivation. There will always be elements outside and around the supply chain that may be motivated to compromise standards. The means to enter counterfeits into the supply chain also practically cannot be controlled be- cause of the many potential touch-points where logistics can be compromised. The key issue that can be addressed, then, is the reduction of opportunity. Counterfeit mate- rials proliferate because of the complexity that lies between their detection and the ability to track back to the source. If there was a high like- lihood that the counterfeit could be tracked to the source and corrective action could be taken, the opportunities for successful counterfeiting would fall drastically. The traceability of materi- als spanning from the point of consumption all the way back to the original manufacturer can be an effective tool. If counterfeits can be detected and then traced back without doubt to a specific source, then either the source is the problem or has the responsibility to eliminate the problem. A few busts later, it will become clear that the introduction of counterfeits can no longer be lost in the system and that precise traceability of materials is an effective way to police and dis - suade the majority of attempts. Only then will electronics manufacturing be able to return to a confident and cost-effective supply chain. SMT LOST In THE SySTEM Michael Ford is senior marketing development manager with Men- tor graphics corporation valor division. To read past columns, or to contact the author, click here. THE EssEnTiAl pionEEr's surViVAl GuidE