The Uptime Blog
Last week Aviation Week magazine held its annual MRO Americas show in Miami. This was a huge event that drew over 8,000 attendees. It was a good show but it’s not really focused on IT solutions. For that, Aviation Week has a new event scheduled for October in Chicago called MRO IT. (You can also investigate Aircraft Commerce magazine’s Airline & Aerospace MRO & Operations IT Conferences.)
The exhibit hall was filled with the normal assortment of vendors pitching various products to lower the cost and improve performance of maintenance, repair and overhaul (MRO) operations. While the exhibit hall was interesting, this year it was the presentations that caught my attention as Aviation Week organized some speakers who were passionate about their opinions. It's healthy to hear open discussion about some thorny issues.
“Drawing Intelligence from Data” was an interesting presentation primarily focused on opportunities that can be exploited by sharing operational data. One of the speakers observed that worldwide fleet operating costs were $525B and that component-related costs represented $50B of that. Furthermore, components accounted for 9 out of the Top 10 causes for flight delays (if weather and air traffic control (ATC) delays are taken out of the equation). One suggestion for improving MRO response was to deploy an information viewer integrating the various parts and information databases into a knowledge base for customer support, maintenance planners and mechanics. Regarding inter-company data sharing, it seems everyone talks about it but no one really wants to reveal their “dirty laundry" (especially reliability data). In addition, there may be conflicting business issues tied to data sharing because OEMs, component manufacturers, MROs and airlines all add non-disclosure agreements to contracts that prohibit data exchange.
Another great topic was, the “Growing Role of Aircraft OEMs in MRO.” The usual suspects—Boeing and Airbus—presented at this session and claimed huge customer satisfaction numbers for integrated service offerings but never revealed how many airlines have "gone live.” (As an aviation consultant said to me later, “Can anyone name a successful Maintenance Toolbox implementation?”) Boeing claimed they wouldn't be forcing airlines to adopt their new MRO solutions but also admitted they're trying to duplicate the Engine OEM’s [heavy-handed] services model. Both Boeing and Airbus claimed they can bring an airline's operations to the “next level” by taking over all MRO scheduling, supply chain management and analysis activities, but the audience seemed unconvinced.
The highlight of the show for me however, was a presentation called “Customers Speak Out” where three speakers from various airlines (two Senior VPs of Technical Operations and a newly-minted CEO) shared their thoughts about the current MRO environment. Here’s a synopsis of what was said about current OEM strategies:
- Airlines own the responsibility for fleet airworthiness and will not tolerate the OEMs’ monopolistic tendencies. Airlines won’t allow OEMs to call the shots regarding MRO practices.
- Airlines will not surrender to OEMs as they try to limit (or deny) access to technical information. Airlines "cringe" at the thought of technical information not being available to preserve safety and operational excellence.
- Airlines are "angry" about OEMs' attempts to insert contract language that limits how MRO technical content can be used/re-purposed.
At the end of the talk, I approached one of the speakers and commented on his apparent “outrage” toward the OEMs. To which he responded, “Did I sound outraged? Good!”
It seems obvious that the OEMs are using technical information as a way to control who performs maintenance (and at what cost) and where parts are purchased (and at what cost). The OEMs want to control the aftermarket service and parts environment for their airplanes by freezing out competition. However, the airlines aren’t fooled; so while the OEMs claim the airlines love their new MRO and documentation policies and products, such as Boeing “Gold Care,” it seems the airlines disagree.
IT systems can help companies respond to maintenance emergencies. To highlight my point I’m using the situation at Southwest Airlines (SWA) as, in the wake of Flight 812, they work to address the problem of aluminum fuselage skin fatigue on their Boeing 737-300 aircraft. While I don’t know the details of how SWA and Boeing are responding to this situation, I imagine a lot of people are working long hours looking for ways to preserve safety and minimize the economic impact.
According to the National Transportation Safety Board (NTSB) the aircraft in question was in compliance with maintenance requirements, so this is not something that SWA did wrong. In fact, Boeing engineers recommended the 737 fuselage be inspected once every 60,000 take-off and landing cycles. Since SWA 737s average 6 flights per day that means an inspection every 10,000 days, or about once every 27 years. (The aircraft that suffered skin failure had only 39,000 cycles on it.) Boeing recently issued a service bulletin (SB) to change the inspection limit to 30,000 cycles (13.5 years). However the Federal Aviation Administration (FAA) has gone further, issuing an emergency airworthiness directive (AD) mandating that older 737s be inspected every 500 cycles, at least until the cause of the problem is known. For SWA, that means every 83 days almost 80 aircraft must be taken out of service to undergo electromagnetic inspection of the fuselage. For a company that runs a lean organization, changing the maintenance interval on an essential piece of equipment from once every 27 years to once every 83 days is a really big deal.
This raises a question for every owner/operator of capital equipment, “Does your IT system help you respond to maintenance emergencies?” Not every service bulletin or maintenance revision represents an emergency. However, real emergencies are unpredictable and it’s hard to know which pieces of information will be needed to resolve one. So perhaps a better question would be, “Is the information in your IT system accurate and complete?” Since you don’t know when the next emergency is coming, and you don’t know what information will be required, it’s important that reliable maintenance and parts data is always available.
The first challenge to maintaining accurate and complete service and parts data is that different suppliers provide technical content in different formats. This makes it difficult for information to flow seamlessly across various IT systems. For maintenance departments, the time and cost required to standardize document types and data formats (e.g. S1000D, ATA 2200, PDF, etc.) can be substantial. However, during a maintenance emergency these costs are irrelevant as planners, engineers and mechanics need immediate access to all applicable parts and service information to fix the problem. In the case of an airline, the required data may come from Boeing, Airbus or any one of over 300 suppliers. (The situation is similar in other industries.) Since safety carries such high implications (both moral and economic) finding a way to resolve the issue of multiple formats, while providing complete and accurate service and parts information, is imperative.
The second challenge to maintaining accurate and complete service and parts data is the rate at which it changes. During a recent asset management conference I took an informal poll and found that maintenance planners believe about half the information in their maintenance planning and inventory systems is out-of-date. That’s not surprising because the work involved to cull through all the technical documentation and update the IT systems can be overwhelming. (Anyone who works with mission-critical databases will tell you that keeping them accurate can be a full-time job.) Technical information changes so frequently that many companies simply wait until the next scheduled maintenance, or until something breaks, to update the maintenance and parts data. (Even then, information rarely gets updated in all databases.) However, this approach leaves a company ill-prepared to meet the demands of an emergency.
Since regularly managing multiple data formats and updating multiple databases appears to be cost-prohibitive, but the cost of an emergency appears to be even higher, what should a company do? The answer is to automate. New and revised information needs to be automatically extracted from updated documentation (maintenance manuals, parts catalogs, etc.) and loaded into the various databases. This activity can be automated, occurring whenever documents are received from the OEM/supplier. Enigma’s InService Revision Manager processes updates, in multiple formats and at any frequency, to keep IT systems accurate and complete, which provides value far beyond the aviation industry.
If you have a maintenance or parts database that never seems to be up-to-date, you may be closer to a problem than you realize. Anyone that’s involved in the day-to-day scramble of equipment maintenance, or has lived through the turmoil of an emergency, knows that reliable information is critical to making good decisions. Enigma has the technology to ensure you’re prepared.
It’s well-known that the Japan earthquake and ensuing tsunami and nuclear reactor disasters have impacted the global automotive manufacturing sector. In addition to direct damage of several Japanese auto manufacturing plants, many Japanese automotive component manufacturers were hit. Even some factories that are far from the disaster sites have either ceased or reduced operations because of power, transportation and/or supply chain disruption. Because most automotive OEMs across the globe depend on Japanese components, especially electronic components, the crisis affects more than Japanese brands. For specifics on which OEMs have reduced or halted production as a result of supply chain issues, see this MotorTrend article.
The triple disaster affects the manufacturing, distribution and supply of new cars; what remains to be seen is how it might affect the supply chain for aftermarket parts. In an article titled “Quake portends upcoming shortages of various aftermarket parts,” Aftermarket Business reports, “In the end, virtually every major OEM will be affected by this disaster by mid-to-late April. It is not a matter of if, but when,” according to Michael Robinet, IHS’ director of global automotive forecasting.
“Certainly the costs of human suffering are more important at this early date, and the long term effects on the global economy – and the automotive aftermarket industry specifically – are difficult to predict,” says Steve Handschuh, president and chief operating officer at the Automotive Aftermarket Supplier Association (AASA).
At this stage there are many more questions than answers:
- If new car production slows down dramatically for an extended period, what will be the ripple effect months later on OEM dealership revenue (both aftermarket service and new car sales)?
- What ripple effects might be felt in dealership service bays?
- How long will current inventory of affected spare parts hold out before service bays feel the impact?
- If there are parts shortages there will likely be price increases, due to the laws of supply and demand; will service bays pass on those costs to their customers? If so, will consumers delay getting repairs?
- Can OEMs find alternate sources for aftermarket parts and components? How quickly and at what cost?
- When it comes to sourcing new parts, will OEMs have any advantages over knock-off parts retailers like AutoZone and Pep Boys?
- If new parts are sourced, how quickly can OEMs inform their dealers and update their parts catalogs with supersession parts information?
We’re curious to hear our readers’ opinions on this topic, so we encourage you to comment.
In the March 2011 issue of Overhaul & Maintenance, an article by Bob Trebilcock titled “MRO’s Tipping Point” focuses on the need for airlines to update supply chain management software. While it raises several important topics having to do with inventory control, logistics, and maintenance operations, the key point of the article is the need for integration between the MRO, ERP and SCM systems.
Trebilcock wrote, “To be efficient, everyone in the supply chain needs to see the same information…the need for integration underlies much of the move toward the adoption of supply chain technology.” The reason integration is important becomes apparent throughout the article. First there is the challenge of transferring the collective wisdom of a highly experienced workforce (many of whom will soon retire) to a new generation of mechanics and technicians who need to be effective. Next is the opportunity to reduce inventory costs by automating manual tasks that still occur around demand planning and forecasting. A third challenge is the transition to lean operations, decreasing maintenance costs and turn-around times, to improve aircraft utilization and offer 3rd party MRO services to other carriers. Finally, integration takes on even greater significance as airlines respond to unscheduled or infrequent aircraft maintenance activities. Connecting the planning, procurement and maintenance execution systems ensures that accurate configuration and maintenance requirements are shared throughout the organization.
The problem for airlines is that maintenance data keeps changing. The configuration of each aircraft can change with each maintenance inspection. Maintenance procedures are changed by manufacturers, airline engineers and regulators. Required, approved and available parts can change on a daily basis. While these changes tend to be made based on aircraft operations, reliability history and cost, it is important that changes flow seamlessly into maintenance plans, equipment lists, inventory and job cards.
Keeping maintenance data synchronized between multiple information systems is a recurring challenge. Trebilcock wrote, “Most airlines have multiple fleets. Keeping up to date on minimum equipment lists, maintenance bulletins and updates and revisions to aircraft maintenance manuals is a major task that slows down maintenance processes.” While maintenance planners often focus on the importance of initial provisioning—prior to aircraft delivery—the follow-on provisioning over the life of the aircraft has a larger impact on costs. (Provisioning is the act of loading aircraft part lists and support inventory into the MRO, ERP and SCM systems and procuring parts and assigning stocking levels for specific locations.) The importance of addressing this challenge can’t be underestimated by airlines; therefore as part of any effort to integrate IT business systems it is critical to have a mechanism for quickly recognizing changes to parts and procedures and then propagating those changes throughout the enterprise.
The reporter writes, “The return on investment from a maintenance software program comes from reduced labor costs, lower inventory and direct material costs from more accurate inventories, and quicker turnarounds.” Throughout the article, Trebilcock makes the point that these benefits hinge on rich integrations and synchronized data throughout the MRO, ERP and SCM systems. Enigma couldn’t agree more.