The Uptime Blog
Mr. Rashidi Saidin, Malaysian Airlines (left) and Mr. Takashi Sasaki, Japan Airlines
AviationWeek held their annual MRO Asia show last week in Hong Kong. Enigma's CEO, Jonathan Yaron, moderated one of the sessions: "IT Considerations in a Modern MRO Facility". The panel included representatives from two airlines - Japan Airlines (JAL) and Malaysian Airlines (MAS) - and from one MRO shop - Boeing Shanghai Aviation Services.
Mr. Takashi Sasaki, Staff Director at JAL Engineering & Maintenance, spoke about the implementation of Enigma and SAP at JAL and how the airline is now starting to reap the benefits of these new IT systems. The Enigma implementation at JAL went live in mid-2008, enabling thousands of engineers, inspectors and mechanics 24-hour access to the most up-to-date technical documentation. Mr. Sasaki stressed the seamless integration between the Enigma system and JAL's Engineering Workflow System (based on Documentum), enabling fast and efficient review of technical manual revisions from Boeing and the fast publishing of JAL Customer Original Changes (COCs) into these manuals.
Mr. Rashidi Saidin, General Manager of Engineering & Maintenance at MAS, outlined the considerations of implementing advanced IT systems in MRO from the perspective of an airline that is still using old legacy systems. He spoke of the troubles arising from the current setup: too many systems that are not integrated properly and contain inaccurate and out-of-date data. Significantly, Mr. Rashidi noted that engineers and mechanics waste 60% of their time searching for information about the appropriate part or maintenance task.
Mr. Bernard Hensey, CEO of Boeing Shanghai Aviation Services, spoke about the need to utilize generic IT systems in an MRO environment, implementing lean projects that avoid a footprint that is too wide. He urged airlines and MROs to "take a serious look" at the IT systems offered by the OEMs (i.e., Boeing and Airbus) when evaluating a new system.
What Mr. Hensey neglected to mention is that most major airlines have either already moved away from OEM-provided technical documentation systems or are seriously considering doing so, in favor of implementing a "best of breed" solution. Indeed, what may be a good system for a small airline operating a Boeing-only or Airbus-only fleet, does not work for an airline operating a diverse fleet from various OEMs. This is especially true when the airline also wants to benefit from integrating the technical documentation to the planning system and produce dynamic job cards.
Generally speaking, and in line with the times, fewer companies attended this year's show. It also seemed like the delegate attendance at the conference sessions was markedly lower. Last year, after the MRO Asia show in Singapore, I wrote that most speakers expressed uncertainty about the future and warned to expect bad times. This year, there was no uncertainty; everyone spoke about how they were licking the wounds from 2009 and expressed hope for better times ahead. The fact that some vendors did not even show up at this show (see pictures below) is an indication of how deep and painful these wounds are.
Empty booths at MRO Asia 2009
A Volvo service technician uses the Volvo VIDA application in a dealership service bay.
As customers start returning to automotive showrooms, they seem to be avoiding service departments. According to NADA figures (as reported by Richard Truett in the November 2, 2009 issue of Automotive News), parts and service revenues at dealerships are dropping. There are a number of reasons for this: fewer new car sales and increased quality means less warranty work; higher parts and service costs (at most dealers) drive customers into independent repair facilities (IRF); improved consumables like engine belts, hoses and spark plugs tend to last longer; modular design practices that promote component exchange makes it faster/cheaper to replace items than to repair them. These and other trends have caused parts and service revenues to drop more than $3B, from 2005 to 2008, at new car dealerships.
I bring this up as another cause of concern for OEMs. (As if they need another worry.) Success or failure for dealership channels relies, in large part, on a healthy parts and service business. However, trying to increase service revenue by decreasing product quality really isn't an option-regardless of the practice of planned obsolescence. Today's customers demand high quality, therefore the question for OEMs is how to restore their dealer's profit centers-parts and service-without adversely impacting product quality and customer satisfaction.
The answer may lie in the complexity of modern automobiles. Dealers are uniquely qualified to service and support the deep-and rapidly changing-technology that is now standard on even inexpensive cars. Truett quotes John Baumgardner, service director at Orange Buick-GMC in Orlando, FL as saying, "'Diagnosing the problem is now more complex than doing the repair work.'" After describing how vehicles have up to 15 programmable modules, Laura Terzs, Ford's manager of diagnostic service products, states that, "'The trend now is to reprogram the modules rather than replace...So we release a software fix to the dealer vs. replacement.'" This suggests that OEMs must provide dealers with advanced diagnostics and software capabilities to ensure they have a service and parts advantage over independent competitors.
Truett writes, "Automakers are acutely aware that high satisfaction scores are a key way to retain customers, so they want to make service department visits infrequent and fast." That may sound as if the goals of OEMs are at odds with the goals of dealers-as they try to increase service revenue-but the reality is different. While it's true that OEMs are trying to reduce the amount (and cost) of service needed by any one vehicle, their focus on maintenance efficiency can give dealers the ability to increase the number of vehicles they service. If successful, the effect would be to switch the revenue equation from servicing fewer vehicles more frequently, to servicing more vehicles less frequently. And more vehicles being serviced typically results in greater parts and service revenue. Ultimately this is a battle for market share and as vehicles get more complex, smart OEMs can give their dealer channel a competitive advantage.
One OEM that has done this successfully is Volvo. Using Enigma technology, the Volvo diagnostics system deployed at most of their dealers has dramatically reduced service times; to the point where each service bay can now repair one additional car per day. If a dealership has eight service bays, that's 8 more cars each day-48 cars each week and almost 2500 cars each year-that can now be serviced by the dealer, without ever expanding their service department. That additional volume gives dealers the flexibility needed to get creative, finding new ways to improve customer service and brand loyalty.
Enigma improves maintenance and repair productivity-it's a one-stop-shop for all service and parts information. Providing technicians and parts managers with the information they need, instantly and accurately, is the first step to ensuring service visits are successful and fast. Helping OEMs find ways to improve dealer service and support is not a simple problem to solve, but it's what we do. As one of our customers said, "Enigma is the aftermarket expert."
Depending on your industry, the word safety may conjure up images of protecting customers, co-workers, the general public or the environment. For companies that operate complex equipment, improving safety is not a strategy it is a moral imperative. But safety comes with a price-time and money. Safety initiatives have a tendency to slow things down and increase costs. Since every business activity includes an element of risk, physical and/or financial, the question becomes, "How to ensure business operations are both safe and efficient?"
I bring this up because making safety an integral part of normal business operations is no easy task. One way is to constantly remind workers of the safety imperative-hoping they will remain vigilant in all their activities. The problem with this approach is that saying the same thing over and over again tends to dull the senses, so that the safety message now falls on deaf ears. Another way is to add safety information into the normal workflow and information systems used by workers. This approach avoids belaboring the message that safety is important, which everyone understands, and instead delivers the necessary information when and where it can be put to use.
In the December issue of MRO Management, Japan Airlines (JAL) describes their experience integrating safety into maintenance operations. The key for JAL seems to be information and communication-collecting information regarding maintenance and safety concerns and communicating that information to all those with a need to know. The article focuses on JAL's safety management system (SMS), "Feedback from problems encountered is put back into the system. If, for example, a part is missing from a component, a warning tag is quickly generated and attached to the component. This may even explain that a flight was cancelled because of the problem-a reminder that the airline's core business is the safe arrival of passengers at their destination. If there is a recurrent problem, then a quality control notice will be put on the relevant page of the Aircraft Maintenance Manual (AMM). If the mechanic clicks on a box, a page will appear, explaining the nature of the problem."
The key to JAL's success seems to be that safety and maintenance information is intertwined. Safety concerns are not handled as a separate issue but are integrated into the key systems and workflows of the maintenance process. As a result, safety concerns can't be overlooked and workers don't become deaf to the safety imperative.
Adding safety information to maintenance systems and linking it to service manuals is the key to helping mechanics improve safe operations without increasing costs. Enigma is pleased to be part of JAL's solution. Working together, JAL and Enigma have developed many innovations that improve scheduled and unscheduled maintenance operations to reduce costs, increase efficiency, and ensure the safety of passengers, workers, the public and the environment. JAL will be talking about their approach to maintenance at MRO Asia next week in Hong Kong. We hope to see you there.