The Covid-19 pandemic severely impacted the Aerospace industry, leading to significant restructuring within original equipment manufacturers (OEMs) and the aerospace supply chain. Production volumes were dramatically cut, and spending on new programs was canceled.
However, the Aerospace & Defense (A&D) industry is seeing a faster than predicted recovery due to the rapid increase in airline passenger traffic, an increase in defense spending due to recent geopolitical events, and an investment in sustainable and urban mobility technologies. As a result, engineering talent has become increasingly scarce and expensive.
A&D organizations are also recognizing that engineering inefficiencies are exacerbating capacity issues. Bain & Company has undertaken a survey within the A&D industry on the effectiveness and efficiency of engineering teams. They found that Aerospace and Defense engineers spend only about half their time on core engineering work, of which 30% or more is spent on rework and more than 40% on lower-value tasks.
Aerospace and Defense organizations document their institutional knowledge and intellectual property for potential future re-use; however, a significant amount of tacit knowledge resides with their engineering experts. This knowledge is required for new product development and solving major in-service issues.
Though several A&D organizations have attempted to overcome this challenge, many are uncertain where and how to start the journey to excellence.
Leading A&D organizations are looking at how they can overcome these challenges by working with outsourcing partners. These organizations use techniques such as Workstream Analysis and Do-Buy Matrices to identify non-strategic areas of engineering tasks that can be considered for outsourcing. Focusing on a range of outsourcing strategies can help improve engineering efficiency by more than 30%.
Outsourcing strategies can be broadly considered in the following categories:
Transition from Leased Labor to Managed Service
Many organizations have traditionally used leased labor to help overcome short-term resource shortages. However, while helpful in the short term, it creates several challenges if used as a lasting solution. The level of management resources and time required to identify, interview, onboard, and train leased labor resources is high, as is the ongoing help and workflow management of these contractors. Re-evaluating the tasks undertaken by contractors and considering workflows has enabled a growing number of organizations to transition to a fully outsourced managed service model, which sees an external company take responsibility for providing a team of trained people to support clearly identified tasks, relieving the organizations engineering leaders to focus on business-critical programs.
Engineering Process Services
As demonstrated in the Bain survey, the majority of engineers spend only a tiny proportion of their time on core high-value work. By grouping these non-core activities across engineering teams and outsourcing them, significant engineering capacity can be released within an existing organization while reducing costs. Custom-developed consultative tools can identify candidate functions or workstreams and standardize the processes to drive commonality across the organization.
End-to-End Process Ownership
During the lifecycle of aerospace products, there are several repeated engineering processes that lend themselves to full end-to-end outsourcing. These activities typically are critical; however, they are not seen as core engineering and are supported on an as-required basis. Concessions management is one such activity where multiple processes are suitable for outsourcing. These can range from visual management and tracking of concessions as they are processed through engineering teams to Quality Clinics to support Material Review Boards, investigation and sentencing of concessions, analysis of past accommodations, and proactive design/tolerance relaxation to eliminate future concessions.
A good understanding of the OEM’s engineering processes, along with careful documentation of the value stream and creation of standard work, enable smooth outsourcing of such end-to-end activities. Often the process can be optimized and performance improved when these activities are outsourced as this becomes the core task for the engineers undertaking the work while freeing up the OEMs engineers to focus on core activities.
Legacy Product Management
As aircraft, engines, and systems are designed for several decades of service, supporting these products throughout their lifecycle is a requirement for A&D organizations. Balancing resources between new product development and support of legacy products is a challenge faced by these companies. A&D organizations have traditionally used their external supply chain to support manufacturing for legacy products, and many are now taking a similar approach to provide technical engineering support to these same products.
Examples of such support activities include:
Quest Global can help in overcoming the scarcity of resource challenges.
Quest Global has been supporting major A&D OEMs, MROs, and Airlines for 25 years and, as such, has gained experience in solving a wide range of engineering challenges, whether technical or operational. A suite of proprietary frameworks and best practices developed by Quest Global has enabled us to partner with our customers to get the best from their outsourcing initiatives.
An aerospace client improved their product build rate by 3X through optimized engineering processes
Quest Global has been working closely with a significant aerospace organization in supporting their engineering workstreams. One of the workstreams is managing production non-conformances. Quest Global helped free up the engineering bandwidth by fully owning the process and delivering value by optimizing and automating the process.