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31 July 2018

On the Shoulders of Giants: The Benefits of Supply Chain Quality Management for SME Manufacturers

By Gordon McKeown

Manufacturers who develop and introduce their own products and manage supply chains can benefit from modern, off-the-shelf product lifecycle management software and process. Managers accountable for production, engineering, operations, IT, planning, quality and R&D can learn from the process innovation and productivity gains achieved in recent years by large OEM’s who have implemented product lifecycle management (PLM) and supply chain QM systems and delivered cost savings, increased volumes, mitigated supply chain risk and safeguarded reputations and priceless brand equity. For smaller firms, this is not about re-engineering your manufacturing processes, just tweaking and optimising them. 

Why should you invest in supply chain quality management? Well, the benefits enjoyed by the large aerospace OEM’s are now within your reach:

Until recently, all PLM and supply chain QM software tended to be very customised and / or proprietary. It was beyond the reach of smaller manufacturers because it was too expensive or just too plain difficult to implement: for example, integrated digital manufacturing systems that automate the link between design and realisation and were traditionally embedded in proprietary CAD solutions. 

I flew to Brussels from Nottingham last month on an Embraer 190, one of the older versions with the engines on the tail. It’s a beautiful aircraft, elegant to behold and fun to be in. I’ve noticed that pilots seem more likely to cloud surf in an Embraer. Being a passenger on a quiet flight across the channel on a sunny evening, you can pretend it’s a private jet! Well, almost. I like the Embraer because of association with certain routes: the early BA flight to London City that hangs a right around the Shard or the KLM City Hopper summer special from Schiphol. One of the airfields I fly to is very small – just a shed and a runway - and I like seeing the Embraer parked casually on the apron, the way a sport car looks cooler sitting on a dusty road than parked in a showroom. You see not merely the machine, but its attitude, character and promise. Quality is about performance, not conformance. 

So, I’m crossing the Channel on an Embraer making notes for an article I want to write about how mid-tier and small manufacturers can benefit from product lifecycle and supply chain quality management. At the top of a list I’ve written, Use Embraer to illustrate what these methods are. Seemed like a good idea at the time so let’s have a stab at it. First, let’s think about why aerospace OEMs innovated their PLM processes and point at some of the techniques that are accessible to smaller firms. 

Aerospace manufacturers have thousands of direct and indirect suppliers. Committed to excellence, they seek to improve all direct suppliers and make continuous improvements in quality, service costs and waste management. They implement supply chain development programmes and pursue substantial ROI from increased production, risk mitigation, on-time delivery and reduction of direct employment costs. 

Aerospace manufacturers have invented cutting edge product lifecycle management because of the enormous scale, complexity and refinement of their manufacturing processes and supply chains. Product data must be shared across different departments and between collaborating partners for the life of the product.  More so when the engineering is so large and complex: from the creative phases of ideation and design through to creation, delivery, commissioning and aftercare. 

Until recently, such sophisticated quality automation processes and capabilities required big investments in manufacturing systems beyond the reach of smaller manufacturers. However, current trends have brought commercially available off-the-shelf (COTS) solutions into the SME market. The most important trends are:

Let’s talk about engines for a second because they illustrate the extent of the challenge. How do you buy a jet engine? How do you know that the 20,000 discretely fabricated components have been assembled and delivered correctly? A GE9X from GE – as used on the latest 777’s from Boeing - will set you back $40m; or how about a Rolls Royce Trent XWB for $35m, as seen on the Airbus A350? Embraer uses smaller engines from GE and Pratt & Whitney, the CF34-10E and PW1000G, respectively priced around $7m and $12m each. You take delivery of a complex, hugely valuable component like that based on its quality paperwork being in order; for example, First Article Inspection Reports (FAIR) and Production Part Approval Process (PPAP).  

Over the past 30 years the aerospace, automotive, FMCG and pharmaceutical industries have innovated quality management processes from product design to launch and aftercare:  from APQP (Advanced Product Quality Planning), to supply chain quality automation and supplier portals, the management of collaborative product definition and now digital manufacturing.  They have defined new standards for quality automation and supply chain partnership.

The following critical capabilities and their business benefits are now within reach for SME’s (and if you are investigating a COTS PLM or Supply Chain Quality solution, consider this list):

Ideagen provides Supply Chain Quality and PLM automation solutions to customers in the aerospace, automotive and pharmaceutical manufacturing industries.

Read the Ideagen white paper on PLM Priorities to learn more about software capabilities you should expect, NPI vs PLM software, and digitalisation trends across different manufacturing sectors. 

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