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The Ten-thousand Foot View on Aerospace & Defense
We know what you are facing
As the industry continues to shift toward a greater amount of supplier content and outsourced manufacturing operations, companies are losing more and more control over their supply chains.
Not only is the supply chain complex, but so too are the products. A&D companies face low-volume, high-mix production, complex BOMs, and long lead times for parts — all of which makes on-time delivery to the customer ever challenging.
As customers push more for performance-based programs, the need for supply chain management coordination between OEMs and suppliers in order to deliver to expectations has never been greater. This is true not just of the civilian market but the defense market.
The diagram below shows just how complex and multi-faceted these relationships have become in the 21st century.
Today's Challenges in Aerospace & Defense
A&D companies are feeling the pressure to streamline manufacturing and business processes in order to decrease unit cost of production. When it comes to reducing inventories and maximizing engineering resources, the stakes have never been higher.
Yet, demand and supply volatility and aggressive order delivery expectations are taking their toll, not to mention the many other supply chain management challenges the A&D industry has to contend with:
- Volatile energy prices
- Spikes in metal prices
- Increasing global competition
- Aging legacy applications designed for a 20th century environment
We Can Help You Mitigate the Risks of Your Multi-Enterprise Supply Chain
To deal with today's increasingly complex supply chains, you need an integrated solution that empowers your staff with planning, monitoring and response capabilities. With the right access to the right information, A&D operations teams can develop better plans faster, as well as make course corrections as soon as there is a potential or actual deviation from the plan.
What if you could…
- Gain deep supply chain visibility across your multi-tier, multi-enterprise supply chain?
- Perform "what-if" scenario simulations on anything, anytime?
- Produce a constrained demand and supply plan that respects key limitations, and identifies the impact on demand and supply commitments?
- Provide all appropriate parties with an accurate and up-to-date understanding of manufacturing commitments and inventory positions throughout the supply network?
- Get visibility on order status when you need it?
- Effectively manage engineering change?
- Learn immediately about unplanned events that could do harm to the business and that require immediate attention?
- Analyze the impact of these events on your customers, your inventory and all of your key performance indicators (KPI)?
- Detail and select the appropriate course of action that maximizes your performance to these metrics?
RapidResponse enables you to do all of that, and it also includes specific functionality for the A&D industry, including:
- Inventory pooling: Parts can be pooled across programs to avoid unnecessary purchases.
- Model-unit effectivity: Each unit on the assembly line can have its own partial BOM so that customizations can be better managed.
- Line-of-balance: Provides a unitized view of demand that identifies the current status of all key assemblies, so master schedulers can quickly review the progress of a specific large-scale contract.
Supply Chain Management in Aerospace & Defense Becomes Mission Critical
In aerospace and defense (A&D), vertical integration is a thing of the past. Outsourcing has fundamentally changed the way A&D manufacturers source materials and manufacture their commercial and military systems. With outsourcing comes a loss of visibility and a greater likelihood of hidden risk.
Coordinating the extended supply chain to successfully meet customer expectations while managing operations performance is the core reason our aerospace and defense customers have adopted Kinaxis™ RapidResponse™.
- “Lockheed Martin Aeronautics chose RapidResponse because it complements its highly complex supply chain infrastructure in dynamically aligning demand and supply.”
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A number of the world's leading A&D manufacturers rely on RapidResponse to turn their supply chain management pains into gains. We have helped A&D customers achieve the following operations performance improvements:
- Reduced excess inventory at one site by $600,000 in first month of use
- Reduced inventory by $52 million in first six months of use
- Shortened time to respond to change from five days to under 24 hours
- Shortened time to perform "what-if" simulations from 160 hours to about 3 minutes (2-3 days for the most complex simulations)
- Reduced product lead time by 35%
- Avoided $4.6 million in inventory purchases (on one project alone) by accurately understanding inventory positions
