The objective of this project was to study the supply chain processes of Airbus. Understand the implementation of RFID technology and analyze how RFID technology can improve the operational efficiency.

1. Supply Chain Management at
Airbus - Implementing RFID
Technology
Operations and Supply Chain Management (OSCM) Project
Date: 24/09/2011

2. Group 9 - Team Members
•Brajesh Kumar
•2012MLP019
Introduction
•Anurag Kanoongo
•2012MLP015
Supply Chain Process
•Gurleen Kaur
•2012HRLP027
Implementation of RFID
•Natasha Mitra
•2012HRLP008
Improved Operational
Efficiency
•Vinod Krishnan
•2012HRLP013
Critical Analysis
•Raman Girdhar
•2012HRLP033
Critical Analysis

3. Project Structure
• Project Learning Objectives:
o Study the supply chain processes of Airbus.
o Understand the implementation of RFID technology .
o Analyze how RFID technology can improve the operational
efficiency.
• Critical Analysis:
o Based on the study, examine the advantages, disadvantages
and challenges of implementing RFID technology.
o RFID is currently the buzzword in the world of supply chain
management. But is it simply a fad or an unstoppable
business improvement?

4. Supply Chain Processes of Airbus

5. 75%of the Aircraft Cost at Airbus is
external Procurement
• Several different
communication modes
• Different Part Numbers
• Different supplier
coding
• Multiple transportation
providers
• Multiple tiers

6. Production sharing by the centers

7. Implementation of RFID Technology
Supplier’s equip their supply goods for Airbus with
RFID tags, which carry important information.
Information is read at each relevant point in the supply
chain.
Information stored in tags include: Serial no’s, Manufacturer codes,
Country of origin, Date of installation and maintenance, Inspection
information etc.

8. Implementation of RFID Technology

9. How RFID technology can improve the
operational efficiency
• Increasing Value Chain Visibility
o RFID enabled real time and automated visibility with an high
level of accuracy.
o Airbus introduced a 'maintenance, repair and overhaul' (MRO)
strategy supporting RFID adoption for “VCV," by tracing both
flyable and non-flyable components over their total lifecycle.
o Increasingly competitive global market, and the need to reduce
costs driven the firm to adopt RFID.
o Airbus views RFID as an infrastructure that can be deployed
across many areas of its business, each of which delivers value
not just to the company, but also to its suppliers and customers.
o RFID acts as their "business radar to let (them) see what's going
on faster and in real time so (they) can make the right decisions
faster."

10. Critical Analysis (1)
Strategic Benefits
• Real time visibility and automatic update of
events across the value chain
• Unprecedented high level of information
accuracy
• Opportunity to redefine and improve key
supply chain processes

11. Critical Analysis (2)
Process Benefits
• More efficient automated processes -> shorter
cycle times -> less inventory
• Increased accuracy & control of business
operations -> less non conformities
• More automation -> Less manual intervention ->
Improved labour productivity
• Automated & realtime tracking of supplier ->
Airbus / non Airbus flows

12. Critical Analysis (3)
Business Benefits
• Increased Labour Productivity
• Reduction in Inventory
• Improved supplier monitoring and flexible
payment solutions
• Improved supplier forecasting -> Improved
supplier delivery performance

13. Critical Analysis (4)
• Disadvantages
o High costs, as compared to bar codes
o Lack of standardization
o Potential Data Interference
o Potential Overload Issues
o Interference with reading tags from environmental factors like metal and
water
• Challenges
o Cost Reduction
o Resistance to Change from Barcode System
o Standardization
o No data interference
o Managing the over load
o Non dependency on Environmental factors

14. Is it simply a fad or an unstoppable
business improvement?
• The success achieved by Airbus seems to
imply the latter.
• RFID undoubtedly has the potential to provide
numerous benefits that are superior to
barcoding.
• Despite the current resistance to acceptance
of RFID, difficulties will be overcome as the
costs decrease, usage extends, and benefits
documented.