SOURCE: Arena Solutions

July 31, 2006 08:00 ET

Survey Finds 83 Percent of Manufacturers at High to Severe Risk of Not Being Able to Track, Document and Report on RoHS Compliance

Arena Solutions Publishes Results of Its Ongoing Restriction of Hazardous Substance (RoHS) Readiness Survey

FOSTER CITY, CA -- (MARKET WIRE) -- July 31, 2006 -- Arena Solutions, the leading provider of on-demand product lifecycle management software for manufacturers of all sizes, today announced the results of its ongoing RoHS Readiness Survey. Launched on April 30, 2006, the Arena RoHS Readiness Survey polled hundreds of manufacturers who were not Arena customers to identify and assess risk based on 16 key capabilities around tracking, documenting and reporting of RoHS compliance. According to the survey, 83 percent of respondents were at severe to high risk of not being able to demonstrate compliance or due diligence for RoHS based on their documentation management capabilities.

While the study found that a majority of respondents had implemented a RoHS transition plan, 69 percent indicated that they did not have a centralized compliance management solution in place that was accessible to employees and suppliers. Having a reliable compliance management system in place is critical to ensuring the company can instantly produce a complete and accurate compliance report, and to facilitate 'design for compliance' for new products. Current regulations require a complete compliance record -- from certificates of compliance to supplier audit reports and component risk evaluation procedures -- to demonstrate due diligence, and that the record be kept for four years after the product has been put on the market. A simple spreadsheet with "check marks" is not sufficient evidence.

The research also indicated that:

--  59 percent of respondents do not have a good understanding of the
    regulations or how to demonstrate compliance and due diligence;
--  60 percent of respondents are not confident that they track all parts
    and materials in their products, have a complete compliance record
    associated, and can verify compliance independently of any regulatory
    requirement;
--  65 percent of respondents would not be able to confidently report
    compliance based on a complete and accurate product compliance record;
--  73 percent of respondents agree that they do not have sufficient
    controls and documentation around change management, compliance
    verification of incoming parts, and a closed-loop process for non-
    conforming materials; and
--  63 percent of respondents recognize that their current solution to
    track compliance will not scale for multiple regulations, and compliance
    for history revisions is not well kept.
    
"Converting products to become RoHS compliant before the July 1st deadline is only half the battle," said Michael Topolovac, CEO of Arena Solutions. "Manufacturers need to be prepared to report and 'live' with compliance, meaning they need to have a robust compliance management solution in place that allows them to track, document, and report compliance as well as demonstrate due diligence when required."

When Arena customers were polled, the RoHS Readiness Survey showed that 80 percent of respondents were at a low or slightly elevated level of risk of not being able to demonstrate compliance or due diligence for RoHS compliance based on documentation capabilities. Based on these findings, the survey concludes that those manufacturers who use Arena PLM are better prepared to manage the EU RoHS directive.

"Arena PLM enables SilverStorm and our global supply chain to share -- in real time -- a single version of the product record which massively simplifies our product design and manufacturing collaboration, and ensures better accountability when designing for compliance," said Jerry Jacobus, director, Quality and Manufacturing Engineering at SilverStorm Technologies. "With Arena PLM we can properly track, document, and report on RoHS compliance, and are confident we will be well prepared for the next wave of regulations."

Arena PLM provides manufacturers with a comprehensive compliance management framework to:

--  streamline collaboration both internally and externally with partners
    on compliance data collection
--  track multiple environmental requirements with compliance status, so
    no single part is overlooked
--  document evidence with a structured audit trail allowing you to
    demonstrate due diligence
--  instantly and accurately report on compliance on any revision of your
    product throughout its lifecycle
--  collaborate downstream with your suppliers and contract manufacturers
    to ensure smooth transition, minimizing scrap and rework
    
The European RoHS Directive, which went into effect on July 1, 2006, stipulates that the following six substances -- lead, cadmium, mercury, hexavalent chromium, PBB (polybrominated biphenyls), and PBDE (polybrominated diphenyl ethers) -- are no longer allowed to be used in products manufactured or sold in the European Union. The EU RoHS regulation is the first environmental regulation with which manufacturers must comply with as the global market transitions to more responsible manufacturing practices. Similar environmental regulations including China RoHS, Korea RoHS and the California directive for RoHS are the next wave in the ongoing stream of new compliance mandates being imposed around the world.

"RoHS is just the tip of the iceberg when it comes to new environmental regulations," said Michael Topolovac, CEO Arena Solutions. "As the world becomes more aware of the environmental hazards of product manufacturing, more regulations will be forthcoming, requiring compliance management to be an inherent part of product development moving forward. Arena PLM was built from the ground up as a scalable framework that enables customers to embrace current regulations and future compliance initiatives as strategic differentiators and more responsibly manufacture products, all without requiring additional hardware or software."

To assess your own compliance risk level, go to www.arenasolutions.com/rohssurvey to access the free survey.

About Arena Solutions

Arena Solutions is the leading provider of on-demand product lifecycle management solutions for manufacturing companies of all sizes. As the only true on-demand, secure Internet-based PLM service, Arena PLM provides a superior alternative to complicated, lengthy and expensive traditional PLM software deployments. Through its award-winning service, Arena enables product manufacturers and global outsourced supply chains to streamline their outsourcing, improve operational efficiencies, and speed time-to-market. Offering the broadest suite of on-demand PLM solutions on the market today -- Arena PLM Workgroup Edition, Arena PLM Professional Edition, and Arena PLM Enterprise Edition -- Arena PLM has been adopted by over 15,000 users across companies at all stages of development.

Arena Solutions' market-changing approach to PLM has received significant recognition in the industry, including Manufacturing Business Technology's Top 40 Emerging Vendors, the 2005 and 2006 Supply & Demand Chain Executive 100, Industry Week's "Technology of the Year - Notable Innovators" and Start Magazine's "Hot" Companies.

Founded in February 2000, Arena Solutions is headquartered in Foster City, California. For more information, please visit the company's website at www.arenasolutions.com.

Arena Solutions, Arena PLM Workgroup Edition, Arena PLM Professional Edition, and Arena PLM Enterprise Edition are trademarks of Arena Solutions, Inc. Other product and company names are the property of their respective holders.

Survey caveats and limitations

The results presented here are based on an ongoing online survey, which began on April 30, 2006. The RoHS Readiness Survey is still active and will run until December 31, 2006. During the time that these statistics were generated, 205 non-Arena customers responded to the online questionnaire. 7% of Arena customers who are currently implementing Arena PLM to meet RoHS compliance responded to the online survey.

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