Trade Wars Are Making Product Design and Engineering Collaboration Risky
The need to protect technological advantages in critical industries, such as the semiconductor industry, is highlighting weak points in the supply chain when it comes to intellectual property (IP) and export control compliance.
Export controls are serious business. Regulations like EAR and ITAR are expanding and enforcement is intensifying. Amongst other industries, the semiconductor industry is seeing new restrictions on how design data is shared—and with whom. How a company responds to export controls also influences how they are perceived by their government. Is the company creating a strategic advantage? Or is it an IP liability? The stakes are high.
And sharing data undoubtedly comes with risk. If a company does not comply with export controls when it comes to data sharing, it faces millions in fines, loss of access to core markets and the chance of handing over technology to a potentially hostile government.
But collaborating across the supply chain and sharing engineering data with essential suppliers is not a choice—it is mission-critical to drive innovation in engineering and maintain competitiveness. Put simply, semiconductor machinery manufacturers have to share data to be able to select and order parts.
These companies will likely have to share more data, more often, as a result of new tariffs, which are putting a strain on the supply chain in terms of costs and availability of parts. Tariffs are increasing costs, and a resulting component shortage is increasing lead times.
With the potential for further tariffs still a possibility, businesses have to be ready for anything while actively controlling risks.
In the face of escalating trade wars and changeable tariffs, let’s consider how engineering teams can protect IP, ensure compliance and build supply chain resilience without compromising on quality or innovation.
The Rising Risks of Traditional Product Design Review Processes
Tackling IP and export control risks first, the reality is that most engineering teams are still relying on tools that were never built for secure collaboration, and this is a big problem.
You can split these tools into three categories:
- Email, PowerPoint and spreadsheet
- File Transfer Protocol (FTP) sites
- Product Lifecycle Management (PLM) systems
All of these methods present challenges for engineering teams.
While PLM is essential for managing part records, it wasn’t designed for collaborative review. Trying to use it that way often leads to markup clutter, serialized feedback and administrative overhead. Unsurprisingly, in a survey of engineering leaders, 71% said that they don’t use PLM at all during new product development.
Most engineering teams routinely conduct reviews outside of PLM, sharing engineering data either via email or via an in-house FTP site. While FTP sites are more secure, they are often slow, and incapable of handling the volume of design review participation and technical complexity required to support advanced product development. Email provides little security and no traceability: Once data has been shared, it is impossible to revoke access or control who else sees that data.
Semiconductor machinery manufacturers collaborate with tens of thousands of suppliers across an estimated 57 countries involved in different stages of the design process. And the reality is, even with IT-approved FTP sites in place, many engineering teams feel forced to circumvent the approved tools (which can be slow), resorting to the less-secure method of email to do their job.
That’s a lot of IP sitting on desktops or in download folders impossible to get back or control. A process inefficiency has now become a regulatory liability.
Sharing Data with Suppliers Is Not Optional
Tariffs create risks by impacting costs, component availability and lead times. To build resilience against these threats, businesses need to bolster their supply chains by ensuring they have alternative sources lined up for critical components and by identifying opportunities to source components from partners less impacted by the tariffs.
On the surface, this looks like a procurement problem, but it is also a massive design review problem. Machinery manufacturers must evaluate prospective suppliers, and suppliers need to see and review product designs to ensure they can meet the specifications required. This means more design data must be shared across the supply chain, which takes us full-circle to the IP and export compliance risks identified above.
Businesses within the semiconductor supply chain cannot afford not to collaborate. Today’s hardware products are built by global teams. Engineers collaborate across time zones and borders. Suppliers span dozens of countries. And technical data moves between them daily.
That reality now comes with unprecedented risk. But unless a company is planning on making every single component in-house—which is impossible for complex machinery—engineering teams need to understand how to design a part so that it meets the constraints of the manufacturing process of a supplier. This requires supplier collaboration and the sharing of engineering data.
Despite this, escalating IP and compliance risks are pushing some companies to exclude suppliers from PLM systems or to restrict the sharing of any engineering data with suppliers altogether. This is despite the fact that in a recent survey conducted by CoLab, 96% of engineering leaders agreed that at least some suppliers should have access to PLM data.
Such restrictions will make engineering teams reluctant to enlist feedback from subject matter experts outside the company, even if their expertise is needed. This lack of collaboration will have a huge impact on a company’s actual ability to source parts, ensure quality, launch new products and drive innovation.
Yet, the same survey revealed that only 17% of engineering leaders thought suppliers should have complete access to PLM systems with their own licenses. There has to be a middle ground that enables the necessary sharing of information to support innovation without exposing companies to unnecessary risk.
The Middle Ground for Managing IP, Compliance and Supply Chain Risk
There is a workable solution—one that guarantees access control, traceability and review integrity, while being easy to use and enabling the collaboration required to build best-in-class products.
A Design Engagement System (DES) starts by solving the issue of access control. Not only do these controls need to be managed at setup, but they also need to be continuously managed to account for team changes. In a 2023 presentation at Siemens Realize Live, an analyst from ASML revealed that its PLM team must change permissions for over 100 users per day (no small task).
Designed to extend and enforce a company’s existing access policies, a DES includes attribute-based access control (ABAC), Active Directory integration, just-in-time (JiT) provisioning, granular roles at every level and downloads disabled by default. This solution delivers enterprise-grade access control, which is automatically enforced at scale.
Once access controls are managed, a DES facilitates secure, scalable, end-to-end design reviews by enabling collaborators to view and explore models in a browser. This means engineering teams and suppliers can view 3D CAD and 2D drawings—as well as use tools like pan, orbit, section, measure and explode—directly in the browser. A file is never downloaded, so it can’t be reshared or stored locally and access can be revoked if required. Using a DES means that engineering teams do not need to email screenshots or use a CAD viewer for markups, either. Instead, comments can be pinned directly onto model geometry so that feedback stays contextual, traceable and centralized.
To eliminate the need to share spreadsheet trackers to ensure feedback is followed through, a DES automatically tracks and manages comments, enabling the engineering team to assign an owner, sort by status, priority or file and track across reviews, suppliers or workspaces—meaning no more feedback will be lost in inboxes.
PLM is still critical for design reviews. A DES is not designed to replace a PLM but instead to capture the steps of design review that happen outside of PLM today while keeping engineering data secure. When integrated with PLM, you can use a DES to share files for review, detect and surface new file revisions, alert reviewers if they are looking at an outdated version, and link feedback to the correct version history.
Adopting and Embracing a Modern Solution
It is imperative that companies in the semiconductor industry build supply chain resilience, protect IP and comply with export controls. But in solving these issues, companies cannot create an engineering problem.
A DES is not just a solution for compliance and supply chain resilience. It solves a lot of problems in the traditional design review process that have other advantages; it is proven to be capable of accelerating design cycles by up to 100%, doubling VA/VE attainment rates, generating cost reductions of 50% and pulling revenue forward by months. But, as with all new technology processes, teams need to be incentivized to use the new system. The solution cannot be something that slows them down or makes their jobs harder as, if this is the case, they simply won’t use it.
For engineering leaders this isn’t just about IP and supply chains, even though these are likely to be high on the list of concerns. In the semiconductor industry, particularly, businesses need to continue to innovate at speed so that they remain a leading technology developer. Ultimately, if the technology you are creating doesn’t offer a strategic advantage, then the sharing of IP becomes insignificant.
To get this right, engineering leaders need to recognize that this is far more than a file sharing issue.
