October 27, 2023

How Real-Time Market Intelligence is Used to Determine Component Risk

Datalynq Team
An image of Datalynq's market intelligence score

In its continual effort to further digitalize the traditional electronic component supply chain, Sourceability launched Datalynq in 2021 to help OEMs, CMs, and EMS providers traverse the complex global landscape. With its upcoming integration into Cadence’s OrCAD X Platform, Datalynq’s robust market data will continue to help engineers and other supply chain professionals avoid design risks and navigate the elaborate electronic component supply chain.  

Here’s the rub: what makes Datalynq’s market intelligence and analytics different from other market intelligence tools in the electronic components industry?  

The difference between Datalynq and other electronic component supply chain market intelligence tools is that the data used by Datalynq comes right from the horse’s mouth. Real-time inventory, transactional, and other data insights are gathered from one of the largest global marketplaces for electronic components, Sourcengine. This gives Datalynq an unobscured view into current component market trends, technical data, component market standing, active alternate lists, and more.  

In its raw form, this data is immense and generated daily. It would be far too easy to lose sight of significant details that support evidence of ongoing component market trends or the preliminary indications of oncoming disruptions. To help weed out vital insights and present them in easy-to-understand language, Datalynq “scores” components on a 1-to-5 scale in five areas crucial to lowering overall risk. These areas are Design Risk, Market Availability, Multi-Source Availability, Price, and Inventory. Design engineers and other supply chain professionals can act quickly and decisively when put together.  

Design Risk Score

One of the most essential steps in securing a product design is to remove components that might be considered risky. Parts that fall under this category could be inactive, obsolete, or not accessible for various factors. How these components end up in a product design is simple: engineers frequently do not have the same visibility into the electronic component supply chain as procurement professionals or supply chain managers. Most often, engineers are simply choosing a part they know gets the job done effectively and that they have some familiarity with.  

Innovation within technology is happening at an amazingly rapid pace, and, as a result, many components face obsolescence faster. This may mean a component that didn’t pose a risk during one product’s design now could. To help engineers become aware of these risky components, Datalynq leverages Sourcengine’s data to score parts on their “design risks.”

The Design Risk Score gives customers a 50,000-foot perspective on the risks associated with electronic components in their product BOM. The score is derived from real-time supply data, component lead times, and part-life cycle status. Parts are quickly identified and scored for increased awareness and fast decision-making.

Market Availability Score

While the Design Risk Score quickly weeds out the parts that pose the most danger to a well-oiled and secure supply chain, Datalynq further weighs the gathered data to identify possible challenges. The Market Availability Score provides the proverbial cherry on top by identifying parts with lower market availability.  

The scores are dependent on vendor and lead time data. A component with a five-star rating means a part has short lead times with multiple vendors supplying stock. If a product has a score in the middle, the component might have longer than usual lead times with only a few vendors to supply inventory. If the part has a one-star rating, the item is available or might have unfavorable and volatile lead times.

In that case, OEMs, CMs, and EMS providers are better off looking for a more affordable alternative. The Market Availability Score also analyzes historical transactional, which is then presented to the user. Users can see how accessible a part has been to decision-making over time.

Multi-Source Availability

A hidden risk to product design security is that of sole source components. These components can be tricky to uncover in an industry with billions of parts to select. Sole source components may be active and have market availability but will likely become prone to future obsolescence challenges, high prices, longer lead times, and supply chain disruptions. When a sole source component enters obsolescence or is unavailable, OEMs are often forced to redesign if last time buys (LTBs) can’t be made.

Product redesigns can be costly and time-consuming for any manufacturer. Still, for those in high-reliability industries, such as healthcare, aerospace, defense, and automotive, this could mean millions spent on recertification processes and months to years waiting for approval. Preventing unnecessary product redesigns, when possible, by removing sole sources is imperative for any OEM, CM, and EMS provider.

The Multi-Source Availability Score can identify whether an electronic component is:  

  • Transferred (Component production is being relocated)
  • Discontinued (No longer in production)
  • Active (Actively in production)
  • Contact Mfr (Contact manufacturer to determine its accessibility)
  • Active-Unconfirmed (Active at the manufacturing level, but its availability is unconfirmed)
  • NRFND (Not Recommended for new designs)

These rankings include the identification of form-fit-function (FFF) alternates, drop-in replacements (DIR), and FES (function equivalents) alternates that are currently active. The more active alternates on the market, the more resilient your product is against future shortages.  

Price Score

The electronic components market is prone to cyclical bouts of high and low prices influenced by lead time, consumer demand, raw material shortages, and other factors. Pricing data can happen gradually and instantly depending on the market circumstances. It can be challenging for procurement teams to track a part’s price history, especially when they don’t know the exact transactional data.  

Since Datalynq’s information comes from Sourcengine’s e-commerce site, the tool’s Price Score always provides precise and relevant information by displaying the highest and lowest price a component has sold for. Supply chain professionals and procurement teams can easily track pricing changes for any component on their BOM at any time.  

Inventory Trend Score

Last but not least, the vital aspect that Datalynq’s market intelligence can track and provide is electronic component inventory trends. With the rising occurrence of shortages and excess inventory, strategizing for future constraints or consumer spending downturns can help OEMs, CMs, and EMS providers manage inventory more effectively. Likewise, transparency through inventory trends can be a crucial signifier of shifting market climates.  

Through real-time inventory data from over 3,500 factory direct suppliers, authorized distributors, and qualified third parties worldwide from Sourcengine, Datalynq can offer scores based on vendor and in-stock quantities.  

When sorted by vendor, users will be given a chart that indicates how many parts are held by which type of vendor, factory direct, authorized, or qualified third party. Secondary information is sorted onto a column that tracks the availability of a component over the last month. Datalynq’s Inventory Trend Score succinctly delivers the necessary information quickly and concisely.  

When these five scores, Design Risk, Market Availability, Multi-Source Availability, Pricing, and Inventory Trend, are put together, procurement teams, engineers, and other supply chain leaders get a clearer picture of the industry’s landscape. With the information provided by the leading e-commerce site for electronic components, Sourcengine, users know they are receiving accurate insights into the electronic component supply chain. Get ready to make the most of Cadence’s new strategic partnership utilizing Datalynq’s illuminating insights!

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