Supply Chain Integration Challenges in Commercial Aerospace (eBook)

Professor Dr. Johannes Walther is Head of the Institute for Production Management (IPM) and professor of Business Administration with a focus on production management at the Faculty of Economics at Ostfalia University of Applied Sciences. He is the publisher of "Supply Chain Management"(TM) magazine, member of the advisory board of the Volkswagen Group Institute for Procurement (IFB) and the Academic Forum of Volkswagen Group Procurement, as well as lecturer at the Volkswagen Group AutoUni. He studied economics at the University of Hannover. After earning his doctorate degree in 1992 he assumed leading positions in industry, trade and service companies. Born in Hannover in 1959, Johannes is married with two children and currently lives in Hannover, Germany.Klaus Richter is Chief Procurement Officer for Airbus Group & Airbus. Additionally he serves as Chairman of the Board of Airbus Germany and leads the supervisory board of Premium AEROTEC Group. Klaus' professional path within Airbus Group dates back to 2007 when he joined Airbus S.A.S. as Executive Vice President Procurement. Before joining Airbus Group Klaus was Senior Vice President Materials Purchasing for BMW. He started his career with McKinsey & Company where he worked as management consultant for automotive, electronics and aerospace businesses and product development. He graduated from Technical University of Munich, Germany, with a PhD in Mechanical Engineering and spent two years as a researcher and lecturer at the University of California at Berkeley. Born in Munich in 1964, Klaus is married with two children and currently lives in Toulouse, France.

Contents 5
Introduction: Supply Chain Integration Challenges in the Commercial Aviation Industry 7
1 Development of the Aviation Industry Over the Last Decades 7
1.1 Airlines 8
1.2 Aircraft Makers and Suppliers 9
1.3 Motivation for This Book 10
2 Overview of the Book 11
2.1 Product Development 11
2.2 Configuration and Demand 13
2.3 Component Manufacturing 15
2.4 Assembly and Integration 16
2.5 Life Cycle Business Models and Aftermarket 17
2.6 Outlook 19
References 20
Part I: Product Development 22
Aviation´s Future Is as Bright as Its Past 23
1 Putting Aviation´s Place in Transportation History into Perspective 23
2 Market Drivers, a Global Context 25
3 Benefits Beyond People 29
4 Things Passengers and Manufacturers Can Look Forward to 30
References 33
Cabin Densification: SpaceFlex2 and Beyond 34
1 The Issues 34
2 The Solution 35
3 Optimizing the Aircraft 36
4 Passenger Comfort 37
4.1 Seats and IFE 37
4.2 Monuments 38
4.3 Bins, PSE, and Lighting 40
5 Conclusion: The Optimized Cabin 44
Innovation Challenges in the High-Tech, Long-Cycle Jet Engine Business 46
1 Introduction 46
2 Engine Innovations 47
3 Innovation Versus Conventional Wisdom 49
3.1 Geared Engines in Perspective 49
3.2 Fan Drive Gears 51
3.3 Variable-Pitch or Variable Area Nozzle 51
3.4 Large Diameter Nacelles 52
3.5 Fan Blade Construction 53
3.6 Combustors 54
3.7 Turbomachinery 55
3.8 The Whole Versus the Sum of the Parts 56
4 Business Value from Technology Innovation 56
References 58
Open Innovation in the Aviation Sector 60
1 Introduction 60
2 Theoretical Background 61
3 Methodology 67
4 Findings and Analysis 68
4.1 Boeing 68
4.2 Airbus 68
4.3 Open Innovation at Airbus 69
4.4 Open Innovation at Boeing 70
5 Conclusion 72
References 72
Disruptive Innovation Through 3D Printing 75
1 Additive Manufacturing 75
2 Additive Manufacturing in Turbomachinery 78
3 SLM Machine Concepts 79
3.1 High Power Selective Laser Melting 79
3.2 Multi-Scanner Selective Laser Melting 81
3.3 Multi-Spot Selective Laser Melting 82
4 Functional Adapted Component Design 83
4.1 Topology Optimization and SLM 83
4.2 Functional Adapted Lattice Structures and SLM 85
References 87
Part II: Configuration and Demand 90
Fulfil Customer Order Process: Customization of Commercial Aircraft 91
1 Introduction 91
2 Basics on Aircraft Purchase Decisions 92
3 Aircraft Customization Process 94
4 Innovation and Customization 97
5 Aircraft Customization: Different Approaches 98
6 Outlook/Future Collaboration in Customization and Digitalization 103
References 103
End-to-End Demand Management for the Aerospace Industry 105
1 Introduction 106
2 Current Challenges in the Aerospace Supply Chain and Possible Solutions 106
2.1 Hybrid Forecasting Implementation: Increasing Demand Availability by Using Information on Previous Aircraft Configuration 107
2.2 Supply Chain Transparency Creation: Improving Demand Availability by Enhancing Communication 109
2.3 Ordering Strategy Selection: Setting Standards by Harmonizing Logistics and Ordering Solutions 110
3 Practical Examples from Aerospace and Automotive Industries 112
3.1 Case Study: Disaggregation of Demand for a Large Supplier 112
4 Looking Beyond: Benchmark Automotive and Aerospace 115
5 Conclusion 116
6 Porsche Consulting and the Aerospace Industry 116
References 117
Main Differences and Commonalities Between the Aircraft and the Automotive Industry 119
1 Trends and Main Fields of Action for Production and Supply Chain 119
1.1 Improving Energy Efficiency in Drive Concepts 120
1.2 Developing Alternative Electric Drives 120
1.3 Technology and Premium Brand Leadership Because of Large Investments 121
1.4 Extending the Product Portfolio 122
1.5 Extending the System Strategy 122
1.6 Exploiting Emerging Markets Through Allocating Development and Production Capacities 123
1.7 Digitization and Visualization of Product Development and Production 123
1.8 New Business Models 123
2 Solutions in the Automotive Production and Transferability 124
2.1 Multi-Product and Multi-Brands Plants 124
2.2 Line Production and Production Segmentation 125
2.3 Standardization and Modularization 126
2.4 Ramp-Up Management 128
2.5 Change Management 129
2.6 Production and Supply Chain 130
2.7 Continuous Improvement Process 2.0 131
2.8 Digitization and Visualization in Production 132
2.9 Optimization During Assembly 134
3 Summary 136
References 137
Part III: Component Manufacturing 139
Trends in the Commercial Aerospace Industry 140
1 Introduction 141
2 Demand 141
2.1 Commercial Aircraft Demand Is Shifting Rapidly to Emerging Markets 142
2.2 Aerospace Is Less Exposed than Other Industries to the Need for Market Proximity 143
2.3 Demand for Aftermarket Services Continues to Grow 143
3 Supply 144
3.1 New Locations Will Continue to Grow as Sources for Global Aerospace 145
3.2 Talent Shortages Are Especially Critical for the Aerospace Industry 146
3.3 Wages Are Rising Rapidly in `Low-Cost´ Locations 146
4 Business Risk 147
4.1 New Competitors Are Emerging from the Asia-Pacific Region 147
4.2 Low-Cost Sourcing May Become More Critical but Remains a Challenge 148
4.3 Supply Chain Complexity Poses a Formidable Challenge 149
5 Technology 150
5.1 Aerospace Manufacturers Could Face Supply Challenges for New Materials 150
5.2 Additive Manufacturing Continues to Make Inroads in Complex Applications 151
5.3 Aerospace Supply Chains Can Benefit from the Digital Thread 152
6 Policy 154
6.1 Governments Continue to Build Enablers for the Aerospace Industry 154
6.2 Policy Initiatives Are Tilting the Playing Field 155
7 Conclusion 156
References 157
Success Through Customer Co-Development, Global Footprint and the Processes In-Line with the Customer 159
1 RECARO Aircraft Seating and the Automotive Heritage 159
1.1 The Heritage of RECARO 159
1.2 Learning from the Automotive Industry for the Aviation Industry and Vice Versa 160
2 What Are the Chances and Challenges of an Aircraft Seating Supplier? 161
2.1 Strong Market Growth Worldwide 161
2.2 Variety of Customer Types 163
2.3 Variety of Products 164
3 A Global Footprint Tailored to OEMs and Airline Customers 164
3.1 Product Development Philosophy and Innovation 167
3.2 Product Architecture 168
3.3 Project Management 169
3.4 Global Supply Chain 170
3.5 Holistic ``Lean´´ Approach 171
3.6 Extended Enterprise 172
4 Conclusion 172
References 173
Vertical Integration: Titanium Products for the Aircraft Industry 175
1 Introduction 175
2 Theoretical Framework 177
2.1 Vertically Integrated Companies 177
2.2 Advantages and Disadvantages of Vertically Integrated Structures 178
2.2.1 Vertically Integrated Companies in the Aircraft Industry 180
3 Methodology 180
4 Findings and Analysis 182
5 Conclusion 186
References 187
Part IV: Assembly and Integration 189
Quality Gates 190
1 Introduction 190
2 An End-to-End Scope of Application 191
3 Definition, Intentions and Benefits 191
3.1 Quality Gate Process Key Principles 193
3.2 A Quality Gate for Each Production Phase 195
3.3 Clear and Systematic Governance Principles 195
3.4 Key Behaviours in the Quality Gate Process 196
3.5 Quality Gate Implementation Steps 197
3.5.1 Define 197
3.5.2 Run 198
3.5.3 Improve 201
4 Early Warning System 201
5 Process Sustainability 203
6 Success Stories 203
7 Conclusion 204
Lean Complexity Through Tailored Business Streams 205
1 Value of Variety Versus Cost of Complexity 205
2 Understanding the Drivers of Complexity Costs 207
3 Limiting Complexity by Understanding Its Value 208
4 Managing Complexity Through Smart Product Architecture 209
5 Tailored Business Streams (TBS) 210
6 Cultural Change 214
Reference 215
Driving the Digital Enterprise in the Aerospace Industry 216
1 Introduction 216
2 Aerospace Production Processes 218
2.1 Parts Manufacturing 218
2.2 Structure Assembly 219
2.3 Robotics 220
2.4 Simulation 221
2.5 Work Instructions 222
2.6 Automation Code Generation 223
2.7 Bill of Process Authoring 223
2.8 Bill of Process Execution 225
2.9 Data Analytics 227
3 Conclusion 228
References 228
Part V: Life Cycle Business Models and Aftermarket 230
The Aero-Engine Business Model: Rolls-Royce´s Perspective 231
1 Introduction 231
2 The Business Model: Comparing Aircraft and Engines 234
2.1 Aircraft 234
2.2 Engine 234
2.3 Business Models Compared 235
3 Business Model: The Outcomes 236
4 Services: Structuring the Aftermarket 236
5 Optimizing the Business Model 237
6 Suppliers: Risk and Revenue Sharing 238
7 Working with Airbus: Innovation in Business Structure 238
8 Secure the Future 239
Reference 241
The Material Value Chain Services in Commercial Aviation 243
1 The Structure of the Aviation Material Services Market 244
2 Strategies in the Material Services Value Chain 246
2.1 Customer Demand for Material Services 246
2.2 Supplier Approaches to the Material Services Market 248
2.3 The Role of Distributors in the Material Value Chain 250
3 Future Trends in the Material Market 251
References 256
Predictive Maintenance: How Big Data Analysis Can Improve Maintenance 260
1 Introduction 260
2 From Preventative to Predictive 261
3 Data 262
4 Analytics 263
5 Digital Twin 264
6 Intelligent Machines 265
7 Supply Chain 266
8 Better Together 267
9 Outcomes Delivered 268
9.1 Asset Performance Management 268
9.2 Maintenance Optimization 268
9.3 Operations Optimization 269
9.4 The Power of 1% 269
9.5 Analytics-Driven MRO 269
9.6 Reduced Downtime 269
10 Conclusion 270
References 270
Outlook 272
1 Introduction 272
2 The Future May Hold: The Standard Scenario 273
3 How the World Might Develop: Alternative Scenarios 274
4 Shaping the Future 276
4.1 Studying the Supply Chain 277
4.2 Catalyzing Cabin Industry 278
4.3 Foresight: Vision Cabin/Cargo 278
5 Technology: The Mean to Shape the Future 281
5.1 Improving the Supply Network: Industry 4.0 281
5.2 Improving the Product: Technology Roadmap 285
6 Preparing for the Future 289
References 289