Ensuring the Value of Quality: Critical measures to successfully combat counterfeit electronics in the supply chain

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labAt Smith, we are fully committed to combating counterfeiting head-on. Learn about how our rigorous SmithSecure inspection programs ensure only the highest quality product passes through our doors to you.

 

 


In this second piece of Smith & Associates' occasional series on anti-counterfeiting in the electronics supply chain, we focus on the actual, realistic steps that should be implemented to ensure the quality and validity of parts.  We offer this piece as a next level drill-down into how our industry's entire supply chain needs to work collaboratively and diligently.  In this article we consider the reality of counterfeit parts in the electronics supply chain and look carefully at the best targets and tools to combat and remove non-conforming and counterfeit parts.

At Smith, we have a long history of extreme diligence to anti-counterfeiting measures and a consistent commitment to what we call our SmithSecure framework. SmithSecure is made up of four distinct, core programs that together ensure the highest level of quality and security for our customers.  From vendor evaluation and stringent sourcing standards (SecureSource); detailed product inspection and testing with database comparison (SecureTest); warehousing and logistics vigilance (SecureService); to a dedication to continual training in the latest standards and practices (SecureTech); Smith understands that every step of the electronic component distribution chain must be scrutinized to ensure the integrity and quality of parts. 

Furthermore, we believe that it is every vendor's responsibility to be diligent about their parts and part handling.  This adherence to quality is why we restrict our sources to a carefully screened set of vendors, and test and verify parts continuously, and primarily in-house, in our state-of-the-art laboratories.  Certified professionals carrying out well-designed and thorough quality programs combined with vigilance and dedication to inspection and testing processes are the most critical tools in anti-counterfeiting measures.

The battleground
Counterfeit goods are an unfortunate problem for every industry, globally.  The discussion and work towards next generation standards to combat counterfeiting continues; most recently, representatives from all of the major chip manufacturing regions met in September 2009 in Munich, Germany (see this overview by EETimes).  As these leaders remind us all, in the semiconductor and electronics industries, no one in the supply chain is exempt from having to be diligent, nor is anyone in our supply chain immune from counterfeit parts entering their supply.  These critical reminders were also underscored by the most recent, major report on counterfeit electronics, performed and published by the U.S. Department of Commerce (January 2010), accessible through this link.

The most common misperception is that counterfeit goods are not part of franchised supply chains; that the problem resides elsewhere in the industry.  Unfortunately, the problem of counterfeiting is not so simple or discerning.  There are no safe havens or immunities; even at well-trusted manufacturers, excess runs on lines have happened (illegally manufactured products); lack of company standards and proper training of personnel introduces opportunities for counterfeiters; lack of and lax standards regarding quarantining suspect parts, testing, return rather than destruction of non-conforming or counterfeit parts, all provide vantage points for counterfeiters to enter product into ALL chains (cf., the DOC report and/or this summary presentation of the DOC report from SEMICON West 2010; reports by the US Customs and Border Protection; SEMI.org statements which continue to underscore the susceptibility to the entire chain; and leading OEMs such as this July 2010 presentation by Intel and their appeal for overt anti-counterfeiting collaboration and Fujitsu; among other industry voices (e.g., this MarketWatch Quarterly report from 1Q10 for a full list of references)).

While we all share in the risks of receiving counterfeit product, we also all need to share in the vigilance required to rid our supply chains of both non-conforming and counterfeit parts.  Once identified, minimally through industry standardized testing and verification processes, non-conforming and counterfeit parts must be properly reported so that their origin is unveiled and therewith removed, and then these parts must be destroyed so that they do not return to the supply chain.

Unfortunately, not everyone in the electronics supply chain is equally diligent in quality assurance measures for training personnel in the critical tools of screening, testing and reliably reporting and destroying non-conforming or counterfeit parts.  Such loopholes are among the most common means by which counterfeit and non-conforming parts enter into and remain in the electronics supply chain, as identified by the DOC and numerous other agencies (cf. a full list of references at the end of this anti-counterfeiting article from MarketWatch Quarterly (MWQ) Vol. 4, No.1).

The tools of combat
For such a critical problem, the most effective solutions to ensuring quality parts are not solely technological.  As the above list of resources and our earlier MWQ article underscore, were all nodes along the supply chain to be diligent in their sourcing (i.e., ensuring that their vendors are implementing stringent quality control and testing measures); were they all to perform their own testing and monitoring of parts (i.e., incoming, warehoused, and outgoing); and finally, were they all to report problems and require certifications of destruction for non-conforming and counterfeit parts, we could dramatically reduce the level of counterfeiting in our industry.  In the following section, we will provide an example of how these simple steps, combined with sophisticated anti-counterfeiting technology, can be used to ensure top quality product and dramatically reduce or eliminate counterfeit product in the semiconductor supply chain.

Beyond the training, inspection, testing, reporting and destruction steps, there are sophisticated tools used by manufacturers and distributors to ensure that the product being passed through the supply chain is, indeed, up to par and original.  Brand markings and trademark imprints have long been a standard throughout all industries, but since these markings can also be copied or counterfeited, the markings have become increasingly sophisticated.  Different types of etching techniques have evolved over the years, and while counterfeiters have been able to copy these, there are a number of ways to quickly detect invalid, counterfeit markings through relatively simple techniques and solutions applied to the part.

Markings have become more sophisticated and may often include radio frequency identification (RFID) tags (cf., here, here, here, and here for more detailed information about RFID), 3-D markings, and holographic tags (cf. this MIT version for an example), and other types of tamper-proof labels and markings.  Intel's recent presentation at SEMICON West 2010 provides an excellent review of how some of these latest labeling techniques are being used in combination.  This multiple marking/tagging makes counterfeiting significantly more difficult and requires the proper (and expensive) equipment to read and verify these tags.  Another good example of multiple tagging systems is found in UL's extensive measures against anti-counterfeiting.  Because of the sensitivity of not providing too much information around how these different tagging systems are manufactured, affixed, read, and employed within the industry, specific data regarding their performance is unavailable.  It seems safe to assume that the more recent tagging systems, such as the ones used by Intel, UL and many others, are very successful in deterring counterfeiting because of the complexity of the tag and the use of multiple, complex coding and reading methods.

RFID deserves more attention though.  This is an extremely popular and useful technology employed in all types of public domain, electronic situations (e.g., tagging, tracking, remote paying, among other events).  It is also a very successful logistics tracking device that is used to add a security level to goods in transit and in warehouses.  While there are numerous uses and advantages to RFID tagging, at Smith we believe that this tool is best utilized as a supplemental tracking measure because of a range of deficits and opportunities for counterfeiting that can occur in spite of RFID tagging.  This is not a comment on all industries, all RFID tagging systems, or programs.  Rather, because of the nature and the type of counterfeiting and non-conforming part introductions into the semiconductor supply chain, we believe that using RFID in conjunction with more sophisticated, hands-on monitoring is the best means to ensure and verify the quality of electronics components.

SmithSecure: An example of a successful anti-counterfeit program
In the first article of this occasional MWQ series, we surveyed the counterfeiting problem and considered issues around standards, particularly.  Herein, we will more closely examine the SmithSecure framework as an example of a method for combating counterfeiting. 

SmithSecure is a framework for ensuring the quality, rigor and diligence that are hallmarks of Smith's industry leading business processes.  The four programs comprising SmithSecure are based on our 25+ years of experience in the semiconductor industry's open market:

  • SecureSource establishes standards and practices for Smith's purchasing, sales, and operations teams, to ensure the highest quality products, every time;
  • SecureTest authenticates by using Smith's in-house labs with the most advanced equipment to verify the authenticity and full-functionality of components;
  • SecureService assures customers the best possible experience, from the handling and delivery of product to long-term inventory solutions;
  • SecureTech, with its focus on continual training, guarantees that everyone on the Smith team is fluent in the latest standards and practices, and allows us to offer our market expertise to customers.

We constantly and vigilantly revise all aspects of our program and implement the latest techniques, standards and equipment to ensure that only the highest quality product is accepted and provided to our customers.  In fact, to many of our existing customers, you will recognize the evolution of SmithSecure out of our long-standing QualityFirst program; the benefit is in the details.

Beyond having a corporate-wide, well-supported quality program, perhaps the most important step, even more so than the establishment of our sophisticated labs supported by rich databases, is training.  At Smith, we call this program SecureTech.  It is critical to the health of the supply chain that those people involved with the testing and part verification processes be well-trained in industry standards.  Without well trained professionals, the ability to successfully implement anti-counterfeiting programs and the identification and removal of non-conforming parts is significantly diluted, if not made unreliable, at best.  Having certified inspectors means that you are ensuring quality in the examination of parts and therewith ensuring the reliability and validity of product in the supply chain (within or outside of your own facility).

Keeping abreast of the evolving standards issued for the industry is a necessity.  These standards include, but are not limited to the following:

 
Smith has long adopted and rigorously implemented ISO, ANSI/ESD and IDEA standards in our facilities and in-house testing laboratories.  We also require that our SmithTest professionals be trained and achieve IDEA-STD-3000 certification.  Before product even enters our facilities, there is a pre-step that is central to our SmithSource program: vendor screening.  The careful and thorough screening of vendors from whom parts are sourced is imperative in quality assurance programs.  Smith has a very strict and multi-tiered screening protocol by which we evaluate and rate vendors.  Furthermore, our vendors are regularly reviewed and re-evaluated in order to maintain their status on our approved vendor list (AVL).

Once product arrives at Smith, it undergoes a 13-step inspection process, spanning SecureTest and SecureService performed in-house:

inspection-process

From RFID tag verification, visual inspection, comparison of documentation (e.g., POs, SOs, etc.) with actual package and product arrivals, to the digital imaging, cataloguing and related quality control (QC) measures, Smith implements a very thorough process when accepting new product.  Should any boxes and/or parts be suspect in any way, they are immediately quarantined and sent to undergo our most stringent level of testing.  In this manner, we begin from the moment product arrives at our 'doorstep' to ensure that only quality products enter into our part of the supply chain. 

After arrival and initial inspection, cataloguing and QC, newly arrived product moves on to our professionally trained Receiving Team, part of the SecureTest and SecureService programs.  At this point, the process involves referencing our numerous, historical digital databases and conducting comparative analyses with visual inspections, in addition to product reference checking with the SecureSource team, the Sales Representative and others who were involved in the procurement process.  These steps further ensure the quality of the product and introduce additional safeguards against counterfeit items entering into the system by keeping a strict control of all product.

Presently, Smith has a number of specialty, high-tech, anti-counterfeiting, in-house testing laboratories, which are the technological backbone to our SecureTest program. We are proud of our investments in these new in-house equipment additions as they not only provide additional services and value to our customers, but also help us to conduct the most thorough, in-house, quality control measures in the electronics supply chain.  Among our new in-house equipment additions are the following:

  • Jet Etch Decapsulation: This machine allows for verification of die size, manufacturers logos, die part numbers, and detects signs of bond pad corrosion/purple plague. Decapsulation machines give us the ability to take a close look at the die to ensure authenticity of the component.
  • Inspex X90-X130 X-ray: This high resolution x-ray machine allows us to look inside the components to verify that lead frames and bond wires are present and connected to the die.
  • JIZ Rack-40 DOD Wipe: This machine permanently wipes information on hard drives to the standard of the Department of Defense (DoD). It can wipe 40 drives at the same time.  When a data wipe is successfully completed, a certificate is issued confirming the drive has been wiped to DOD standards.
  • Luxo Scopes: Upgraded microscopes that amplify the outer surface of the component. With this magnified view, we are able to detect signs of counterfeiting such as remarking, blacktopping, sanding, oxidation, and/orre-tinting.
  • Datapaq Oven: Used for in-house baking.
  • Expansion of our resources for in-house solderability testing.

At Smith, we ensure that non-conforming and counterfeit product is immediately quarantined, undergoes strict testing, and is then reported; additionally, we require certificates of destruction.  We take these steps to ensure that non-conforming and counterfeit parts are permanently removed from the industry's supply chain. 

While our inspection process is lengthy and detailed, Smith is also known for our ability to meet high quality standards with agility and aggressive turn-around times for our customers.  Our secret is simple: because we have the sophisticated equipment, certified inspectors, and rich historical and current databases on parts in-house, we are able to complete all four programs in our rigorous SmithSecure framework in a relatively short time frame.  We have invested in our personnel and equipment because we believe that quality is a priority and that combating non-conforming and counterfeit parts in the semiconductor supply chain is not only within everyone's capability, but is also everyone's duty.

Counterfeiting itself is unlikely to disappear from our industry.  At Smith we believe that while counterfeiting may be an age-old problem, we are fully capable of combating it head-on and ensuring that our customers only receive the highest quality product.  We welcome you to visit our facilities and learn more about the work we have been doing for years to maintain our diligence to ensuring the highest level of quality and service while successfully combating counterfeit parts in the electronics and semiconductor supply chain.

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