Counterfeit parts: Knowing what they are, managing the risks, and how blockchain could change the game.
What is a Counterfeit Part?
A counterfeit part is officially defined by Aerospace Quality Management System standard AS9100:D as ‘any unauthorised copy, imitation, substitute or modified part that is knowingly misrepresented as a specified genuine part of an OEM or authorised manufacturer’.
As well as the product itself, this definition can also apply to any supporting documentation used to demonstrate conformity e.g. a mill test certificate or certificate of conformity.
Unfortunately, this issue has dogged several manufacturing sectors for many years now – with a quick internet search you will find many notable examples, particularly within the steel industry where there have been a number of high profile incidents involving falsified mill test data and stockholders knowingly mispresenting fake product as being authentic. Due to the potential risks to product conformity within the Aerospace, Space or Defence sectors, specific requirements around preventing counterfeit parts were incorporated into the latest revisions of the AS9100 series of standards. Managing the risk of counterfeit products should also be a consideration for ISO9001 certified manufacturers and stockholders in any other sector that depends on the integrity of the material used.
How can Counterfeit Parts be avoided?
The first place to start with avoidance of counterfeit parts would likely be through the source of supply. When selecting a new supplier, whether it be a manufacturer or stockholder, there should be a good level of due diligence performed. Some good starting questions may be:
- Are they an authorised / approved vendor for the product you are looking for?
- Do they hold recognised third party certifications such as ISO9001 (General Industry), AS9100 (Aerospace) or IATF16949 (Automotive)?
- Are you confident in their capability to provide full traceability back to source for all materials?
These are just 3 fundamental areas consider. However, the type of diligence required will likely go beyond this and vary by sector.
I personally think there is also a strong link here to an organisation’s policies on ethical behavior and personal integrity – during investigation into some of the high profile incidents referred to earlier, it has often been found that the underlying cause has been due to a poor organisational culture where delivery has been prioritised over integrity of product.
When evaluating a new supplier it is well worth considering how a supplier educates their employees on matters such as ethical behavior and integrity, and whether a “just culture” is evident in the organisation – where staff can openly report errors and speak up against a violation of procedure.
How can Counterfeit Parts be detected?
Understandably, controlling the source of supply will be your first line of defence against counterfeit parts, but controls specific to the verification of actual product purchased shall also be considered.
This is where the robustness of your goods receiving processes and competence of personnel working in this area will come into play. Before the product is even taken out of it’s packaging, there are questions we can start to ask:
- Does the packaging look genuine?
- Do the accompanying conformity documents look acceptable? Is there any evidence to suggest the use of correction fluid?
- Can it be verified that the results stated on the conformity documents (e.g. mill test report) match your criteria?
That last one is particularly important, and the need to evaluate supplier test reports is actually a requirement of AS9100 clause 8.4.2.
In practical terms, this would likely involve checking supplied test certificates for compliance against the relevant standard or specification that has been requested. For example, in the aerospace world Aerospace Material Standard AMS4150 defines specific requirements for 6061-T6 grade aluminium alloy extrusions and rings – any deviation in the test certificate values against the requirements of the material standard would immediately open up a cause for concern. Especially if you have explicitly stated the aforementioned standard on your purchase order to the provider.
For some parts determined to be high criticality to an end user, the combination of source controls, visual inspection and evaluation of test certificates may not provide sufficient assurance and it will be the responsibility of your organisation to put in place more diligent inspection regimes to check the integrity of material. This may involve sending samples to an accredited third-party laboratory for independent testing.
Another alternative I have seen on my travels as an auditor is the emerging use of handheld x-ray fluorescence (XRF) spectrometry equipment. Recent developments in x-ray spectrometry technology have enabled instant positive material identification using a portable device, rather than a static bench-top unit typically requiring high voltage power supply. For many organisations this will offer a rapid, non-invasive, and economical solution to material verification. However, from a business perspective there would be other considerations that would need to be made such as the costs and resources required for radiation safety licensing and personnel training.
Blockchain: The Future of Counterfeit Parts Prevention
In the future, I believe that blockchain technology has the potential to play a significant role in the war against counterfeit materials. Conformity records could be digitally encrypted at the point of production, and saved into a decentralised blockchain where technical data cannot be altered and all transactions through the supply chain can be verified. This would provide a greater level of transparency in the origin of material, and possibly reduce the need to conduct costly and time-consuming inspection processes. The emergence of blockchain technology is something that I feel should be closely observed by stockholders and the purchasing departments of advanced manufacturing organisations.
Counterfeit products continue to present a risk to many different sectors, and unfortunately documentation alone cannot always guarantee a conforming product – global shortages of certain materials as a knock on affect of the pandemic may continue to compound this issue further. Ultimately, having a well implemented Quality Management System that follows a risk-based approach will help you to implement controls that are appropriate within the context of your product / industry.
You can connect with Andrew Milner on LinkedIn.