Tim Odokeychuk, president of AME Australia, describes how manufacturers can create their own resilient systems when entering the defence and aerospace markets.
Author: Tim Odokeychuk, president, AME Australia
Aerospace manufacturing – a global dogfight. Those who have dedicated themselves to success in our critical aerospace sector know very well the complexities of their operating environment and the challenges they face on a continual basis.
Grappling with environmental factors – varying exchange rates, rising competition shifting bases of operations like MROs, a pandemic severely influencing consumer and commercial behaviour patterns, and rising cyber security risks to IP and assets – presents a myriad of considerations to keep in sight, all the while trying to seize opportunities in growing areas such as space tech, remote piloting or autonomous systems, electric propulsion, replace-in-the-field solutions with additive manufacturing, and the list goes on.
Navigating this landscape and its ‘rules of the game’ can be all-consuming for the leaders of our region’s diverse network of OEMs, suppliers and support service providers as they seek sustainable growth through their partnerships and in their own right – it’s truly a global dogfight but one that presents great opportunities at our doorstep.
An appreciation of a system
Leadership and quality visionary Dr W. Edwards Deming – who played a vital role in rebuilding post-WWII Japan and translated several effective management principles into his infamous 14 Points and the System of Profound Knowledge – is renowned for emphasising that “the system that people work in and the interaction with people may account for 90 or 95 per cent of performance.”
Essentially, the message that Dr Deming is conveying is that the performance of each of our organisations is largely tied to the system we’re either a part of by default or had (usually) only a small hand in creating.
To illustrate this, our Australian aerospace manufacturers and their partners rely on critical aspects which can be largely out of their immediate control, such as:
- local government, global policies and support mechanisms that create favourable conditions to operate and thrive in;
- secure supply networks that uphold the security and shared risk and reward commercial values as they do;
- access to talent with essential and emerging skills who are primed for contributing to the success of the organisation;
- and effective pathways to commercialise invested research and development efforts, to name a few.
If these elements of the system are not present and functioning, our leaders and their teams may be finding themselves primarily focusing on limiting loss from the constraints of erratic demand, poor material flow, less-than-desirable quality, a shortage in talent, depleting working capital, deteriorating assets and a general lack of enablement. In other words, they’re likely to be overexerting themselves in a system where they’re stuck working IN the business, not ON it.
If you find yourself in such an operating environment and recognise the imperative to transform your ‘system’ towards an aligned, connected and committed ecosystem to deliver on a shared purpose to create value together – what should you consider before you move forward?
Fly by wire: connecting & optimising the whole
It’s quite cliché to say that a chain is only as strong as its weakest link but having a strong chain is key to avoiding the risk of sub-optimising which has clear consequences and is ultimately a fundamental impediment to growth (and in more extreme cases – survival) regardless of whether you are a private corporation, part of a Public Private Partnership or even a state-owned enterprise.
Value Chains must be a group linked resources that have the means to create optimal shared benefit with the minimal use of resources. They need to be learning organisms that evolving to the changing needs of its environment and ultimate customer.
The design and pursuit of excellence across your value chain is much like having a successful program that puts a craft into service for a full and useful lifecycle. For example:
- To be able to fly effectively, any craft needs to be designed to accept loads through all states of its operation, it requires a source of fuel and method of propulsion and a level of aerodynamics that help optimise its energy usage. Similarly, a world class value chain needs to be designed with delivery of its evolving products or services effectively, have infrastructure to resist external forces and to efficiently convert investment of human and working capital into results.
- You need program level measures as well as instrumentation in the craft to understand the health of all aspects of the craft and the forces the environment outside are exerting and ensure you have the ability to respond to conditions that outside of optimal limits with the appropriate mechanisms and redundancies. Again, your value stream needs to link the demand to control flow of material and information and while being able to predict, signal and respond to needs of the resources and their stresses with mitigations to keep them in peak performance.
- Your craft also needs the means to navigate along a course from one point to its next destination and ability to manoeuvre turned along its journey as storms emerge, oncoming craft are detected. A shared purpose or true north needs to be the guiding beacon for all your partners within your value chain. Not just the next way point or KPI. Together, you need to plot the course and steer through the environment and out of turbulence.
Of course, we know that no design is perfect but, over time, a connected and committed ecosystem will gain improved ways of working together, measuring its performance while anticipating and adapting its business model to the changing world – effectively creating its own resilient system prepared for sustainable growth.
“If you wish to go fast, go alone. If you wish to go far, go together.” – Origin Unknown