An exclusive roundtable event brought together senior UK decision makers to debate ways to maximise the global competitiveness of UK aerospace & defence.
Hosted by Hitachi Consulting and held in conjunction with The Manufacturer’s Annual Leaders Conference, the roundtable gathered a select group of business leaders from some of the world’s leading aerospace & defence companies.
With participants representing industry’s most established marques, innovative start-ups and everything in between, the discussion predominantly focused on two challenges:
- Improving manufacturing agility and capacity through the practical application of advanced, connected technologies
- Boosting efficiency and output through continuous improvement across the supply chain
Encompassing the Internet of Things (IoT); big data; analytics; automation, and advanced production techniques the likes of additive layer manufacturing, many consider the tipping point for Industry 4.0 to have arrived.
The combination of now readily available technologies such as these may hold the key to unlocking a step-change in performance and productivity. However, there was an air of caution around the table, particularly in regards to data security and the challenge of protecting intellectual property.
A number of contributors highlighted the extremely sensitive nature of the projects their companies are involved in, and the potentially catastrophic ramifications should data fall into the wrong hands – whether inadvertently or otherwise.
Due to the risks at play, one member declared that a sufficiently high enough level of security could never be reached that would persuade his company – and others – to migrate to the cloud and adopt more open working practices.
Several added that they remained reliant on portable hard drives and air gapped machines, yet were still encountering challenges even with hardwired, physical systems.
Others noted that the lack of an industry or sector-wide standard operating procedure for an industrial internet of things was a potential hindrance.
There appeared to be some discrepancy between how attendees viewed ‘low-risk data’ such as that pertaining to HR, with one member feeling confident in migrating those systems to the cloud.
However, others argued that it may open a backdoor to more sensitive information, and warned that even low-risk data could be used nefariously.
With sensitivities around sharing data and the cost of cyber security seemingly ever-rising, several mentioned that it had begun to not only impact their ability to conduct business with suppliers, but even other divisions within their own organisations.
Taken together – the reliance on point-to-point machines, the cost of data security, the lack of trust regarding cloud infrastructures – participants said that there were increasingly being forced to centralise systems, which in itself was leaving them vulnerable.
Supply chain Improvement
By design, aerospace & defense has to be a low-risk industry, products and the components that comprise them have to perform first time.
As such, the single-sourcing of materials and components has become more common. One speaker suggested a move towards standardising components, similar to what happens in the automotive industry, hoping to avoid risk by taking variety out of the equation.
However, several raised concerns that such a move could compound challenges arising from quality assurance issues, citing Toyota’s recent global airbag-related recalls.
Delegates agreed that there was scope to identify areas where standardisation was applicable, with potential opportunities for modularity, but it relied on a greater understanding of what end-result was desired.
The importance of customer relationship management (CRM) was raised, a sentiment that many were agreed upon; with one speaker noting that supplier relationship management (SRM) was equally crucial, especially if companies wanted to become more deeply embedded within their supply chains moving forward.
Regarding future goals, almost all participants cited raising organisational agility, however this was at odds with the industry’s current obsession with efficiency and cost.
One method of boosting agility was by leveraging the capabilities offered by additive layer manufacturing (ALM), helping to lower tool overheads, reduce lead times and enable parts to be sourced from a variety of companies.
An advocate for ALM stressed how the technique allowed parts to be made in ways physically impossible by any other means; though concerns over the consistency of structures – something pivotal to aerospace & defense – was prolonging the certification process.
A contributor concluded that raising agility didn’t mean simply putting on or taking off shifts to cope with fluctuations in demand, it had to be embedded organisation-wide through long-term programmes, with both internal and external parties working in unison.
Mark Hughes from Hitachi Consulting discusses balancing the risks and rewards of connected technologies
The aerospace & defense industry is a key sector for UK manufacturing which is projected to continue growing over the coming years.
However, it also faces a stiff headwind arising from the need to rapidly increase manufacturing capacity and improve supply-chain competitiveness.
Aerospace companies are at the leading edge in their adoption of digital technologies for engineering design and in the use of advanced manufacturing technologies, such as additive layer manufacturing.
However, they often fall behind other industries in the adoption of digital and connected technologies in production management and supply chain operations.
Concerns about data security and the protection of intellectual property must first be addressed if these technologies are to be more widely adopted.
Connected technologies, including the industrial internet of things, will improve traceability across the supply-chain and provide opportunities to improve both flexibility (the ability to absorb variety) and agility (their responsiveness to customer needs).
It sounds obvious to say that aerospace is not the same as automotive. However, the implication is that approaches pioneered in automotive cannot simply be copy-and-pasted, but must first be adapted.
For example, the degree of standardisation and the appropriate balance between centralised and de-centralised systems must be determined.
Finally, the implementation of new technologies is a people issue as much as it is technical one.
Previously, automation followed optimisation of an existing process. In the future, new technologies may transform processes, or eliminate them altogether.
The resulting disruption will create organisational stress as roles are redefined and new skills developed.
Managers will need to actively lead their people through both technical and adaptive change to mitigate any risks and to realise the potential rewards.
In our experience, developing a current-state maturity assessment and an implementation road-map which addresses both the technology and people dimensions of change, is a good place to start.
Hitachi Consulting is the global management consulting and IT services business of Hitachi Ltd., a global technology leader and a catalyst of sustainable societal change.
In that same spirit—and building on its technology heritage— Hitachi Consulting is a catalyst of positive business change, propelling companies ahead by enabling superior operational performance.
Working within their existing processes and focusing on targeted functional challenges, we help our clients respond to dynamic global change with insight and agility. Our unique approach delivers measurable, sustainable business results and a better consulting experience.
For further information, please contact:
Mark Hughes, Vice President, Industrials