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How to Roll Out an MRO System for Airlines without Making Your SCM Problems Even Worse

Written By: Phil Reney
Published On: December 8 2011

When it comes to complex software implementations, some industries have it tougher than others. For instance, an airline company implementing a maintenance, repair, and overhaul (MRO) platform has almost no margin for error.

To put things in perspective, I’m not referring to small airlines operating a daytime schedule with a few planes. I’m talking about large operators with multiple fleets of aircraft, round-the-clock operations, and international destinations to manage. Not only do these large players need to keep their maintenance activities in line, but they must also ensure that the supply chain is feeding through all required parts throughout the organization.

What makes this problem interesting is the current framework of their MRO activities, from both the operational perspective and the IT perspective. Traditionally, a lack of symbiosis between these two perspectives has resulted in segregated strategies for resolving their challenges, which makes it difficult to find straightforward ways of implementing MRO software. That’s why the first challenge is to realign them in order to increase efficiencies and savings across the board.

The Context

A large airline typically operates a fleet of several hundred planes, with four to seven models from an average of two to three manufacturers. Today’s aircrafts are comprised of over 350,000 parts with a similar number of part fasteners and over 30 miles of cabling. And while not all parts or subassemblies are subject to the same maintenance frequency, they may have to handle over 10,000 stock-keeping units (SKUs) per model while factoring in versioning management. The high dollar value of the parts raises the stakes even higher: a washroom faucet can cost $10,000 (USD).

Additionally, these international airlines do most of their maintenance work domestically (internally or outsourced), so as to keep maintenance flights to a minimum. They leverage a network of maintenance locations divided between hubs and satellite locations. These hubs are often attached to airports that also function as major connection or staging areas for commercial flights (whereas satellite locations are a mix of hangars or rented space with dedicated warehousing). Within these hubs are the machine shops in charge of reconditioning rotable parts and other components such as engines and cable harnesses. Only when it comes to overnight maintenance at international destinations are these activities often subcontracted. Keep in mind that you might find 30 aircraft mechanics working on a single plane at one time, on a multishift schedule, with thousands of part movements that must also be tracked. You need a substantial level of automated functionality to make all this happen.

Now, these airlines haven’t grown overnight—some of the "young" airlines are only a little less than 20 years old, while established airlines have typically been operating for over twice that period of time. These legacy airlines pioneered their various industry practices and consequently developed the systems running their daily operations.

But as with most large businesses, IT initiatives tend to be segregated and dispersed among functional areas such as maintenance, warehousing, passenger services, etc. As the industry evolved and new regulations came into force, it was natural for these airline’s IT groups to keep developing additional layers of support and new applications (since design scalability or service-oriented architecture [SOA] were not established practices at the time—to say nothing of overall governance). Today, you can appreciate the maturity of an airline based on the spaghetti chart of its IT infrastructure.

However, organic growth in IT structure creates a natural tendency to segregate information across a variety of systems that often do not communicate with each other, except for specific and limited purposes. Furthermore, the variety of technologies and designs makes it difficult to bridge older solutions with more recent off-the-shelf point solutions.

Consequently, partial effectiveness is a common result, as not all information can be synchronized, and even when it can, it’s often necessary to create yet another bridge with a concordant translation table. Analysis and actionable information that would normally be readily available in an integrated platform needs to be obtained through extensive data collating and reporting conducted through and outside the network of systems. More often than not, airline systems are generating multiple versions of the truth.

The Vicious Circle

There’s still the inescapable fact that redoing everything means costly upfront internal development, significant time, and potentially high disruption to profitability. After all, an airline is only profitable so long as the cargo hold or seats are full and in the air. Any slowdown in activity due to an ongoing implementation would also mean significant costs internally (e.g., training personnel en masse, ironing out business processes, etc.), resulting in longer turnaround on plane maintenance, which in turn impacts the front end with fewer available flights and a potential hit to customer confidence.

However, staying the course is a recipe for slowly pushing your business toward a type of IT anaphylactic shock. At best, implementing each new solution will take longer and longer, and your return on investment (ROI) will shrink faster than the Arctic ice caps.

Although this may reflect your reality, the good news is that it’s actually possible to escape this IT quicksand.

A Path to Follow

Naturally, moving all your MRO and supply chain activities to a unified platform overnight is the stuff of nightmares. But it’s quite realistic to first target the central modular areas composing your immediate supply chain—namely, financials, production (refurbishing and maintenance repair work orders), warehousing, purchasing, and workflow management. This last area will be the workhorse for devising flexible processes that tie in to other functional areas, such as compliance and quality management.

These five elements will provide the basis for a uniform view of parts movements (to/from the mechanic, the shop, the warehouse, and the supplier) and costs, along with a view of the work being conducted on them. While still large in scope, it's easier to manage the input/output of multiple decentralized activities already designed to work together (as opposed to having fewer higher-level centralized activities, such as maintenance planning, with significant repercussions downstream and the inability to follow through with execution). They also represent the highest volume of individual operations within the organization. Consequently, you will be able to retire a significant number of point solutions and therefore limit the scope of integration with respect to legacy systems.

The next recommended step on your roadmap is to implement the maintenance planning aspect of your operations. At this point you will be able to feed a more concise demand scheme to the various parties (hangars, machine shops, warehouses, purchasing), which will allow them to adjust accordingly (with less firefighting, to boot).

A logical follow-up would be to implement the quality management functionality that was previously handled through a combination of workflow and legacy systems. This step is primarily geared toward providing a more optimized interface for your quality assurance (QA) operations.

And depending on your organization, you can then implement the various functionalities attached to engineering (often tied to product lifecycle management [PLM], e.g., design management, part retirement, etc.). Any other activities you want to bring into the platform will depend on the level of integration you wish to leverage and also the scope of functionality the new platform can provide. It's likely that you will be able to integrate all or at least a sizeable portion of your airside activities and leave the front end (revenue-generating activities such as flight reservations) to a different system.

I'm Sold on the Destination, But What Should I Bring With Me?

While it’s useful to know where we want to go, it’s also practical to know how and what we need to get there. In my next article, I’ll discuss how project management and workflow within maintenance planning can help you better plan your maintenance activities and consequently demand management. Subsequent entries will also touch on the various tools and visibility aspects in parts tracking, compliance management, purchasing, and logistics. The ultimate goal is to establish a comprehensive flow from one end to the other of your supply chain within your MRO network.

 
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