About IHS Inc.
• Founded in 1959: To provide product
catalogues for aerospace engineers
• Today: Leading provider of critical technical
information and insight, decision support tools,
and related services
Security
Product
Lifecycle
Energy
• 55,000 customers in over 100 countries
• ISO9001 company with 3,500 employees
Strong, Growing Products and Financials
Environment
Copyright © 2009 IHS Inc. All Rights Reserved.
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•
•
•
•
January 2009
IPO
Nov 2005
Public, NYSE
IHS
FY09 revenue:
$967M (+ 15%)
EBITDA:
$279M
50% of revenue outside of US
Proliferation of Environmental regulations
Geographic and medical device compliance lists
RoHS v2 Recast
UN Stockholm Convention on Persistent Organic Pollutants
Norway PoHS
China RoHS
Japan
REACH SVHC
Customer RFP Driven (Chemicals and Materials)
IBM, Dell, HP, Cisco…
Kaiser, Premier, Novation, Amerinet …
Thales, Airbus …
Health Canada
Canadian Chemical Management
EU Medical Device Directive
US Code of Federal Regulations; Food and Drug Administration
US California Proposition 65
…
Copyright © 2009 IHS Inc. All Rights Reserved.
January 2009
Here are at least five good reasons to act …
Fears surrounding ‘toxic’ substances used in our products
Deca-BDE?
DEHP?
Cadmium?
Phthalates?
Lead?
Copyright © 2009 IHS Inc. All Rights Reserved.
January 2009
Chemical Management – not optional for the supply
chain.
What are your priorities?
Place enabler in appropriate quadrant for your company
A2
B
A1
Regulations
A1
Tracking and interpretation; alerts
A2
A2
Standards & Lists
A2
A2
Standards for matl. composition
declaration and chemical lists
D1
I
M
P
O
R
T
A
N
C
E
High
B
Content:
Material composition, SVHC,
Compliance, Registration,
Obsolescence, Alternatives
C
System of Record & Analysis C
MDS, part and material
composition mgmt; List reporting;
BOM and risk analysis
D2
E
C
D1
Low
D2
D2
A1
Low
High
URGENCY
Copyright © 2009 IHS Inc. All Rights Reserved.
January 2009
B
Notification: Inbound
Aggregate and manage from
upstream suppliers
D1
Notification: Outbound
Publish to downstream users
D2
E
Green Inventory Optimization E
Duplication across enterprise,
safer and less costly alternatives
F
Verification & Auditing
Physical substance testing,
process and content auditing
F
Who is Impacted?
Impact is cross-functional and global
Global Supply Chain: Impact to continuity of supply; Disruption due to material
obsolescence and availability.
Global Manufacturing: Supply chain disruptions have already impacted material availability,
costs and lead-times for production.
Global EHS: Product stewardship regulations and customer demands continue to proliferate
globally. Lack of systems and information to respond is inefficient and resource intensive.
Global and Local Regulatory: Additional label reviews, change package reviews and
approvals, tech file/design dossier updates and submissions, reviews for PMA and 510(k)
impact. Assessments needed for global impact to registrations.
R&D: Identification of alternate materials and costly, unscheduled product redesign.
Global PSM: Collection of material content data from suppliers. Identifying alternate
suppliers in compliance with global requirements. Increased supplier management.
Global Sales & Marketing: Inability to quickly and accurately respond to customer material
content requests and RFP’s such as Kaiser and Premier.
Global Ethics & Compliance: Adherence to Code of Conduct.,
Copyright © 2009 IHS Inc. All Rights Reserved.
January 2009
2
Priority Declarable Substance List (PDSL)
Aerospace and Defense Standard Substance List
Copyright © 2009 IHS Inc. All Rights Reserved.
January 2009
Make vs. Buy: Calculation Model
Economies of Scale with Industry Standardization
Make: In House
Do it Yourself (Independent)
$
Buy:
Outsource (Third Party Specialist)
Buy: Economies of Scale
Outsource + Industry
Standardization
Copyright © 2009 IHS Inc. All Rights Reserved.
Time
January 2009
e
Impact to Supply Chain
Disruption of Supply Chain: Lessons Learned from RoHS
Chemical Restrictions Impacting Margin:
RoHS Lead Restrictions = 35% to 300%
Increase in Costs for Leaded Parts
Individual Manufacturer Price Book Examples 5/30/2008
3x
3
2.5
2
1.5x
1.35x
1.5
1
0.5
Chemical
Registration
Deadline
0
Mosfet
Tantalum Capacitor
RoHS Compliant Alternative
Op Amp
Traditional Pb Part
Chemical Restrictions Impacting Obsolescence:
SVHC Publication was a significant factor in the
300% increase of End of Life (EOL) documents
for electrical components in 2008
SVHC
Publication
4
Copyright © 2009 IHS Inc. All Rights Reserved.
January 2009
Just how big of a deal is this to medical industry?
It’s a very, VERY big deal!
2009 Fortune 1000:
Top Medical Products & Equipment
Rank Company
1
Medtronic
2
Baxter International
Fortune 1000 rank
196
$ millions
$13,515.00
219
$12,348.00
3
Boston Scientific
320
$8,050.00
4
Becton Dickinson
347
$7,158.50
5
Stryker
375
$6,718.20
6
St. Jude Medical
520
$4,363.30
7
Zimmer Holdings
543
$4,121.10
8
Beckman Coulter
675
$3,098.90
9
C.R. Bard
791
$2,452.10
10
Teleflex
797
$2,420.90
11
Biomet
808
$2,383.30
12
Applied Biosystems
811
$2,361.50
13
Dentsply International
847
$2,193.70
14
Varian Medical Systems
876
$2,104.90
15
Kinetic Concepts
938
$1,877.90
16
Hill-Rom Holdings
942
$1,862.00
17
Bio-Rad Laboratories
977
$1,764.40
18
Invacare
983
$1,755.70
$80,549.40
Copyright © 2009 IHS Inc. All Rights Reserved.
January 2009
Only one of these
companies did not
participating in
today’s webcast.
Redesign Timelines from IHS Medical Webinar
Understand/Scope Timeline and Costs
Redesign or certifying your primary product/line would take?
Less than 1 month
4.5%
1 - 3 months
4.5%
3 - 6 months
8.0%
6 - 12 months
30.7%
12 - 18 months
82%
20.5%
More than 18 months
31.8%
0%
Copyright © 2009 IHS Inc. All Rights Reserved.
5%
10%
15%
January 2009
20%
25%
30%
35%
Impact to Product Design
Unscheduled Product Redesigns – Long Pole in Tent
Example Scenario from a current IHS Project
33%
of OEM’s Parts found to be out of compliance to various regulations
79%
of those parts had a supplier recommended replacement.
21%
of those parts had no supplier recommended replacement
What is your average
timeline for product
redesign and
certification - 6, 12 or
18 months.
What would be the impact if forced to engage in an
unscheduled redesign and certification of 21% of our
non-compliant parts?
5
Copyright © 2009 IHS Inc. All Rights Reserved.
January 2009
Webinar Live Polling:
Solution needs to support Compliance, LC ….
LIVE Audience Poll Question: To introduce a new part or establish material
compliance, which factors play a role in part evaluation? (check all that apply)
Lifecycle Analysis &
68.7%
Supply Continuity
72.9%
Reliability
77.0%
Compliance Status
Material Disclosure &
79.1%
Composition
Technical Fit (e.g. Form,
87.5%
Fit, Function)
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
TECHNICAL FIT:
More important than
compliance itself.
100%
Live Audience Poll: Supply & Demand Chain Executive Webcast "Redesigning Medical Supply Chains" featuring IHS October 15, 2009
Copyright © 2009 IHS Inc. All Rights Reserved.
January 2009
IHS Electronics Database: Provides Lifecycle Visibility
Ignore lifecycle at a great cost and a great risk
Two primary lifecycle methods:
Predictive planning algorithms - commodity analytics
1.
•
Fill data gap
•
Validates supplier responses
Supplier response
2.
•
Typically less than < 50% response
Predictive Characteristics
Sales A
Trends
Memory
Organization
Memory
Density
5
1
Semiconductors and Components:
A Product Lifecycle Point of View
6
New Product
Product Change
End of Life (EOL) or
Introduction (NPI)
Notification (PCN)
Discontinuance (PDN)
LTB Notice
3 Package
2
Supply
Voltage
Maturity
4 Spee
d
Illustrative example of key Technology
Group attribute drivers (SRAM) and Sales
Data
Decline
Growth
LTB
YTEOL
Introduction
Today
Phase-out
Obsolete
Case Study: Medical OEM undertook compliance program investment without full visibility in
part status  Missed 11% of parts obsolete or on LTB after re-design was complete.
Copyright © 2009 IHS Inc. All Rights Reserved.
January 2009
Best Practice: You Need Access to Alternatives
Alternative parts, materials, and supplier evaluation
Copyright © 2009 IHS Inc. All Rights Reserved.
January 2009
IHS is uniquely positioned to address REACH
Information critical to comply, manage risk, optimize performance
• Which regulations apply to me and what they impact?
• Which localized versions, requirements, and legal
obligations?
• How do I identify, compare and select
compliant, lower-risk alternatives?
• Which of my business plans and products are exposed
to risk?
• How do I evaluate, compare and drive
greater business performance?
• How do I establish my supplier,
material, and compliance
requirements?
• How do I optimise a product portfolio to
improve market position?
• How do I aggregate and process
high volumes of complex/disparate
data?
• How do I monitor supply chain
performance and escalate critical
issues?
• How do I declare compliance and material
composition to stakeholders?
• How do I manage changes upstream and
downstream within supply chains?
• How do I maintain supplier, material and
product compliance information?
• How do I verify the receipt or
acknowledgement of documents &
information?
• How do I measure and report the current
state of compliance and risk?
Copyright © 2009 IHS Inc. All Rights Reserved.
• How do I monitor constant regulatory
changes and supply chain realignment?
January 2009
Copyright © 2009 IHS Inc. All Rights Reserved.
January 2009
16
Consistent and Clear Format
Copyright © 2009 IHS Inc. All Rights Reserved.
January 2009
Compliance Data Collection
All Parts (AVL): Electronic, Mechanical, Sub-Assemblies…
Custom
Mechanical
Raw Materials
Assemblies
Adhesives
Fasteners
Plastics
Chemicals
Copyright © 2009 IHS Inc. All Rights Reserved.
Cables
January 2009
Components
IHS’ ISO9001 Process
Over 50M parts,1B attributes employing over 45 logic checks per part
Component Management Tool
ISO 9001
Process
SE Suppliers’ Part
Composition
Data
Existing
Material
and
SDS
Content
Expertise
Aggregate
Classify
Logic Checks
• CAS Numbers
• Substance Names
• Computational
Consistency, etc.
√
Enrich
Standardize
QA
PLM
Material Composition
Database
? # of Article & Preparation
? # suppliers
Copyright © 2009 IHS Inc. All Rights Reserved.
January 2009
Not
optional
Comply Plus
AVX Component
Full Material Disclosure Example (Before IHS Processing)
Copyright © 2009 IHS Inc. All Rights Reserved.
January 2009
After
Copyright © 2009 IHS Inc. All Rights Reserved.
January 2009
Availability FMD in IPC1752 Format
Sample - 1.4M Full Material Disclosure (FMD) Documents
Availability of FMD Data in IPC1752 Format
100%
80%
60%
40%
20%
0%
FMD's provided in IPC1752 format
FMD provided in other formats
Manually normalize data from all formats - XLS, XML, Word, HTML, PDF –
for bulk loading into EMARS
Copyright © 2009 IHS Inc. All Rights Reserved.
January 2009
Optional – IHS Composition Database
ComplyPlus can house CAS level composition data for analysis
Copyright © 2009 IHS Inc. All Rights Reserved.
January 2009
IHS Comply Plus
Compliance Data System of Record and Analysis
Store/manage/access (Parametric Data)
•
•
•
•
SVHC/Hazardous materials
Full material composition
REACH declaration of compliance
Store/manage/access (Documents)
•
•
•
•
•
REACH CoC document
Safety Datasheet (SDS)
Product Datasheet
Full Material Declaration document
Other documents
•
•
Where Used: Find all articles and
preparations containing a specific
substance (such as proposed SVHC)
• What-if scenarios: If the entire SIN
list became SVHC, how would that
affect my supply chain?
Traditional licensed and installed application vs. SaaS
Connection between systems for key data points
Copyright © 2009 IHS Inc. All Rights Reserved.
On part contents against Hazardous
Substances Lists of interest (SVHC15, SIN List, 67/54/EEC, PDSL, etc.)
• By collections of items (electronic
components, specific manufacturer’s
parts, preparations, plastics, paints,
etc.)
Simulate
Access
•
Report
January 2009
IHS Comply Plus
Product and Material Compliance Analysis
Part and Manufacturer
Information
REACH, PDSL and
Other Compliance
Information.
Part Substances,
Weight, Pct.
Contribution (If
Sourced)
Copyright © 2009 IHS Inc. All Rights Reserved.
January 2009
IHS Comply Plus
Product and Material Compliance Analysis and Expanded Part Data
View Composition
Information by % or
Weight
And
Identify % of
Composition with CAS
Material Composition Information Can be Stored,
Aggregated from all Sub-Components,
Compared Against Various Lists and Thresholds,
and Summarized at the Part Level
Indicators and Reports Update Dynamically
Based on Updates Made to Substance Lists
Supports REACH, PDSL, SIN 1.0, Custom Lists,
Many Others
Copyright © 2009 IHS Inc. All Rights Reserved.
January 2009
26
Analysis and Reporting
Copyright © 2009 IHS Inc. All Rights Reserved.
January 2009
Leveraging Core Competencies
Enables OEM to drive differentiation and value
OEM Competency:
• Collecting publicly available data not core competency
• Focus on OEM market and market IP
• Core work starts once data returned - EOL. redesign, supplier selection
Suppliers
• Focus on engineering/supply chain decisions
• Leverage supplier relationship for escalation
Competency:
Part and Material
Compliance and
Composition Info.
• BOM load
and analysis
• Parts
Attributes
• Parts
Reused
• Aggregating technical/composition data core competency
• ISO 9001 certified data collection process
• Data validation with cooperative supplier escalation
• over 50M components, 1B attributes and 10,000 MFR processed
• Third party expertise recognized
by regulatory agencies – UK BERR
January 2009
Copyright © 2009 IHS Inc. All Rights Reserved.