Supply chain 4.0 can deliver “step change in productivity”
FIA Connect explored some of the major challenges facing logistics in a panel session which discussed how digitisation could enhance processes with representatives from Pratt & Whitney, Salesforce, CapGemini Invent…
FIA Connect explored some of the major challenges facing logistics in a panel session which discussed how digitisation could enhance processes with representatives from Pratt & Whitney, Salesforce, CapGemini Invent UK and Hanwha Aerospace USA.
The session looked at the complexity of the supplier production network, the volatility caused by the COVID-19 pandemic and other factors such as the changing dynamics of a global market.
Supply Chain 4.0 was facilitated by Steve Freshwater, Executive Vice President of CapGemini Invent UK and explored different business perspectives on how new processes, enhanced digitalisation and industry 4.0 advances could deliver solutions. The panel session explored the stages the companies were at in their journey towards Supply Chain 4.0.
P&W: COVID downturn puts intense focus on cost
Shane Eddy, Chief Operations Officer. Pratt & Whitney (P&W) said COVID-19 had resulted in a drop in demand within the commercial element of the business of around 40-50 per cent, depending on the sector.
But he added military production had remained strong and, in some cases, was being accelerated to offset the lower demand on the commercial side.
Eddy said P&W’s Industry 4.0 processes were still underpinned by its drive to recruit highly skilled people, the implementation of robust processes as well as utilising leading edge technologies and systems. “Safety and quality are always top focus,” he added, explaining that production required defined processes which met complex requirements and served to safeguard costly capital assets.
He said new technologies were being used to accelerate the production processes: “With manufacturing, the things that are coming off these machines these days is unprecedented. Suddenly, all the ingredients are there for full digital value streaming. We’ve got 3D models coming into these highly engineered processes that are really well controlled with with inline verification and they can stop or even adapt in flow – that’s really game changing for us “
Eddy said enhanced processes were helping the company to adapt to volatility caused by the COVID-19 pandemic with a “much more intense” focus on cost.
He added that better use of automation and more connected services was enabling the company to adapt and achieve more with less. He explained: “We’re able to service this demand with a significantly smaller industrial footprint that would have been contemplated 10 years ago. So this lower investment in today’s COVID environment as you might imagine, is even more important for us.”
Eddy explained automation had helped P&W to engineer tough assembly challenges posed by manufacturing large engines to tight tolerances, as well as enhancing on-site safety and environmental health.
He added: “This automation, coupled with real time problem solving, has driven up yields. And that covers both our on time delivery and our cost performance, so really we have all the metrics going in the right direction. By connecting the machines, the people, the networks and the data drives visibility, efficiency, quality, and predictability on the shop floor. We’ve really seen a step change in that productivity in our factories.”
Innovation 4.0: “a tale of two geographies”
Hanwha Aerospace is headquartered in Taiwan and South Korea and services the commercial aerospace and defence markets, the company generates an annual revenue of around $5 trillion and has 11,000 employees.
The company also has sites in Vietnam and Connecticut, USA and a joint venture with Pratt Whitney in Singapore. Ben Adams, President of Hanwha Aerospace USA described the journey towards innovation 4.0 as “a tale of two geographies” as the company grows towards becoming a global business.
He said US business was predominantly in manufacturing and R&D with a less complex supply chain. Within the Asia market, he said inputs came from raw material and hardware providers with “a lot of the value add that we create [is] in our four walls.”
Adams added that over the last three to four years the company has centred its industrialisation efforts on availability, performance and yields. He explained: “The machine side and monitoring the health and accuracy of our machines is paramount to good yield. First and foremost, and that is characteristic, accountability is by far the most important thing that we look to enhance on a daily basis and through these investments so machine health and accuracy, we’re monitoring dynamic signals.”
He added that data was collected using controls and different sensors and RFID strategies embedded into the machines with digital fixture libraries which helped with design across the business for uniformity and ease of setup.
He said: “We’ve seen tremendous benefit in safety, employee satisfaction, but also outputs. We’ve grown that business by 30 per cent a year over the past three or four years, we’re hitting our cost profiles, and in generally making a step change in quality with visibility right at the operator in terms of statistical process control.”
“We have a number of those investments throughout the business where we’ve painted that same digital footprint and they’re all performing really well.”
Pandemic has changed engagement with the supply chain
Within Salesforce, the COVID-19 pandemic was accelerating awareness of supply chain dynamics and the need for companies to turn strategy into reality and adopt digital solutions for their processes.
Rob Heys. Business Development Manager for Salesforce explained: “We have seen an uptake and an acceleration in certain areas. So organisations are starting to see that what might have been kind of ethereal and the esoteric paradigms actually start getting on with these things, and actually some of that realization, with how different geographies are approaching it.”
Reflecting Adams’ points, he said different geographies had different levels of maturity with regards to their industrial strategies with much of it orientated around high end manufacturing and automation.
Heys said he was seeing more customers realising that they needed to accelerate these developments, but do it in “bite sized chunks,” taking into account investment into existing technologies. He added the COVID-19 pandemic had led to a big acceleration in awareness and was changing the engagement with the supply chain, which he said would lead to a “more collaborative” relationship between the system integrators, OEMs, tier one suppliers and those further along the chain.
“You could have a paradigm where you’ve got full connectivity – I’ve got EDI, I’ve got IoT coming from machines and my tier two supplier is speeding up, but actually, at the other end of the spectrum, how can I create a more collaborative environment with my suppliers? So one of the things that we’re doing with customers is leveraging technology to create those collaborative environments, so create communities where you can start to share the information, share change notes across the supply chain, share changes in rates, actually have a two way conversation around that.”
Heys said the pandemic was leading to many companies having to renegotiate terms for long term agreements which they had preveviously been locked into. He added that this was leading to more “two way conversations” than would have taken place in previous years.
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