2. White Paper - Supplier Base Optimization 2
INTRODUCTION
Aircraft manufacturing is considered to be the technological backbone of the
U.S. manufacturing base. Aircraft manufacturing contributes significantly to
the U.S. economy, with total sales by aircraft manufacturer (including defence
and civil) comprising 1.8% (Source: Congressional Research Service) of the U.S
gross domestic product.
The aircraft industry's commercial segment anticipates difficult business
conditions for the near and medium term, but long-term projections by Boeing,
for instance, are positive, with airlines expected to need 29,000 new planes
valued at $3.2 trillion between 2009 and2028 (Source: Congressional
Research Service ).
For now, the defence segment of the aircraft manufacturing sector has offset
the downward trend because it still benefits from continuing government
expenditures for military aircraft. Aircraft industry analysts nonetheless predict
that there could be tough times ahead for producers of military aircraft.
With the increasing challenges that Airbus and the global aerospace market
face where 70% is sourced externally (www.airbus.com); Supplier base
Management has a key role to play in supporting the business, delivering
profits and ensuring sustained performance.
Many aircraft manufacturers are losing orders to their competitors since
compressed lead times are taking a toll on their position in the market. The
rate at which supplier approval happens is increasing and money invested is
staggering.
By having the right supplier base management system aircraft manufacturers
can open up communication across technology platforms and create greater
efficiencies and fewer errors.
The result has been an ongoing restructuring within the aircraft industry supplier
base, with significant implications for customer-supplier relationships and
potential national security. With excess capacity and increasing cost pressures,
many aircraft companies are dramatically reducing their numbers of suppliers.
At the same time, many of these suppliers are being asked to take on
additional responsibilities in terms of design, assembly, material management,
risk sharing, and even taking part in fostering the internationalization of their
customers' supply base.
Final aircraft assemblers like Boeing and Airbus rely on suppliers to build and
integrate considerably complex assemblies, such as, wings complete with
hydraulics, fuel monitoring systems, flaps, and thousands of rivets. Major
aircraft subassemblies arguably are as complex as entire automobiles.
Supplier management in the aircraft industry therefore takes on additional
importance in terms of cost competitiveness and the quality and performance
of the final product. The complications increase two fold when the supplier's
products do not meet the specification required. Thus a root cause analysis
should happen with preventive and corrective actions which will help the
suppliers meet the requirements.
What’s inside…
P a g e 2
P a g e 3
P a g e 4
Introduction
Challenge Statement
Value Proposition & Benefits
Implementation
Summary
3. White Paper - Supplier Base Optimization 3
CHALLENGE STATEMENT
The supplier base management systems used across most manufacturing
organizations is not centered around the Supplier’s Corrective Actions. Data is
collected and stored and handled in many different ways by different groups.
Some parts of the process are paper based requiring hard copies of records to
be signed and stored in document vaults, others used local systems developed
on legacy and proprietary technologies. In most cases, the supplier corrective
procedures is emailed as attachments, faxed or mailed between company and
supplier and entered into various systems manually. The challenge is to create a
Tescra provides an integrated functionality platform for the Supplier Corrective Actions by creating an online
communication platform and a single interface for the Supplier Management System which aids in the decision
making process which helps in choosing and comparing suppliers to improve the strategic partner relations with the
suppliers.
The platform covers key areas such as, overall organizational performance, business customers, quality systems,
performance measurements, manufacturing capability and improvement, sales inventory and operations planning,
workforce profile, cost, delivery and maintenance, critical processes and new product development capabilities.
VALUE PROPOSIITON
First, the system supports workflows
for “ of
requirements which ensures
suppliers are aware of failures. The
secondly support is for “
type of requirements that
require the supplier to respond to
the company with detailed root
cause analysis for corrective and
preventive actions.
BENEFITS
Continuous monitoring and
tremendous efficiencies in the
supplier quality management
process is achieved across the
business and supplier base. The
problem solving methodology
module helps achieve this.
:
This is achieved by reducing the
process waiting time, ensuring
immediate communication and
setting clear priorities.
4. White Paper - Supplier Base Optimization 4
Conduct Audit
Verify
Implemetation of
Corrective Actions
Review Violations
Develop Corrective
Action Paln
Implement
Corrective Actions
The solution maps the company’s organizational hierarchy covering
corporate, as well as, all other divisions; business groups, business lines and
locations. Employees are also mapped to their appropriate roles in the
system enabling flexible user administration with easy management of access
rights.
The system front end is linked to the supplier portal (built on SAP Enterprise
Portal technology) from where users can directly access the solution through
single sign–on, based on shared authentication of credentials. Suppliers will
have easy access to scorecards that present data analytics to the greatest
level of detail.
Supplier corrective action can be initiated directly in the system based on
supplier quality issues identified during receiving and incoming inspection of
parts or based on issues logged at the production line via the SAP QN
(Quality Notification) application. Though its integration with SAP, it allows
users to search for issues in the QN application (QNs) and initiate a SCA
(supplier corrective action) request for one or more QNs. The real-time
integration transmits all the relevant data from SAP to platform created for
QNs for which SCA requests are triggered, eliminating duplicate data entry
and ensuring information integrity.
IMPLEMENTATION
SUMMARY
Integration specialists like Tescra can assist companies in the manufacturing
sector in realizing the full potential of their technology investment by
synchronising the demand signals across all tiers of the organization's supply
chain, improving the process of supplier base management centered around
the supplier corrective actions.
This includes supplier performance monitoring which also includes supplier
process list and periodic scorecards integrated over diverse platforms. The
supplier assessment system can initiate periodic audits to monitor
development and launch readiness evaluations. The interface solution can
also be accompanied with Web based integration. This provides the standard
framework for technology and allows customized offerings. With these
offerings a business can have quick containments, true root cause
determination using effective tools which address both detection and
occurrence which ultimately will assist the business implement systemic
corrective actions to drive performance.
Founded in 2002, TESCRA is headquartered in San Ramon, California, USA. Tescra has been identified as a Top 100 Minority owned
business, recognized as one of America's Top 500 diversity-owned businesses and recently added to the Inc 5000 list as one of the fastest
growing companies in the USA. Our experience and commitment to excellence is reflected in our customers' successes in attaining their
business objectives.
One of our core values at TESCRA is that "Performance Drives Our Success". TESCRA's objective is to craft the best possible blend of
Business and Technology Solutions for our customers' business events, achieve performance excellence and maintain lowest cost in the
supply chain.
Our ability to retain Customers and gain repeat business is a testament to our dedication to quality, business understanding, technical
abilities, project management skills, and cost-effectiveness. Customer satisfaction and long-term relationships are the best measures of
our quality and performance. We have a history of 100% successful completion of projects.
