Boeing Flies into Supplier Turbulence with the 787

In the past year, everyone in the aviation business this side of the Atlantic has had a good laugh as Airbus' bloated A380 met delay after delay thanks to supplier problems. But it turns out that Airbus is not the only A&D giant having supply related issues. Last week, Purchasing brook the scoop that "problems with suppliers have slowed the progress on its 787 Dreamliner project to the point where it will delay its test flights to mid-November at the earliest, rather than the mid-September date originally planned." What's the issue, you ask? The first, software coding problems, is almost to be expected in such a complex platform where so much of the production is outsourced to third parties. But the other two are a bit of a surprise: documentation and the supply of "thousands of fasteners that go into the plane". Purchasing cites a quote from 787 Program Manager which notes that "Boeing and its suppliers are working through a shortage of aerospace fasteners and rivets, which has increased the amount of work Boeing has had to do at its own plant."

What's the lesson here? Boeing, whose overall Spend Management and operational program designs for 787 production were probably among the most advanced in the history of A&D, will not meet some of its 787 test/delivery expectations thanks to challenges throughout its supply base (some of which are controllable such as documentation requirements, others of which are far more challenging). In my view, as manufacturers buy more and make less, they run a greater chance of running into a 787-like scenario, regardless of how well their overall program is designed. But the key, as Boeing knows, is visibility into all supplier-focused activities and analytics to detect and forecast issues as earlier as possible. Clearly, it's this level of visibility and analysis which is what will separate manufacturing leaders from laggards in the coming years.

Jason Busch

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