Improving repair yield across multiple MRO shops
Some of the largest markets in the aviation industry are the MRO & aftermarket segments. Billions of dollars yearly are spent in MRO activities, where it is critical to return components to serviceable condition, else this money must be spent on expensive, new-make Spare Parts, or sourced from Used Serviceable Material vendors, which can be a difficult proposition depending on the aviation climate. Therefore, the use of component repair facilities, and their corresponding yield rates on returning parts to a serviceable condition, are key drivers in many MRO supply chains around the globe, with much focus on the productivity of these facilities.
A major aviation MRO firm was focused on its component repair facilities’ productivity for its largest product line, and, like many MRO firms, faced an uphill battle of increasing repair yields. While preliminary data was used to screen and find the parts that needed technical and business attention, many details for a successful turnaround were missing or unclear.
Phase 1: Key Challenges
Finding where in the repair process the parts were falling out
Many parts will undergo a long, complex process of discrete cleaning, inspection, and repair steps. Not only did the full process need to be understood, but how technically each process step influenced later steps.Comparing repair processes from different facilities
While having one shop can reduce complexity by a degree, the firm had multiple facilities located across multiple continents repairing the same parts. Not only did the facilities’ processes look different, but they also had different yield rates for the same parts. This further complicated finding the causes and solutions.Different data standards and collection
The facilities all used different standards surrounding the collection of data, how it was recorded, and where it was recorded, which created yet another layer of complexity when determining the causes, the “why” of yield rates.
Phase 2: Evaluation
The team began the project by studying the process for the parts at these facilities, leveraging technical and business knowledge while building relationships with the management and operators at the facilities. During this period, a more complete picture of the state of the component repair yield rates was formed.
Key Insights
Many of the key repair yield issues were the same or very similar
After sorting through the data, speaking with the facilities’ personnel, and understanding each facilities’ process, the causes of the decreased repair yield indicated a very Pareto-like behavior; a few key causes were driving most, if not all, of the fallout, which was not initially appear at the beginning.Despite similar yield issues, different facilities needed different technical solutions
During the study, technical discrepancies and improvements in process, tooling, and equipment were identified, with each facility having different needs for improving repair yield. Identification of these needs was made much easier after mapping out and understanding the differences in repair processes across all facilities from a technical and business standpoint.Facilities were not sharing best practices and insights regularly
While it can be expected that facilities will not always communicate day-to-day, the different cultures, locations, and time zones led to a lack of centralized communication about key repair processes and best practices, despite executing on the same parts.Line-of-sight and motivation differences among the facilities
Culture at each facility was noticeably driven by line-of-sight and motivation; more pointed, the “back shop” component repair facilities that were closer to the internal MRO facility were more focused on increasing repair yield rates and aligned their metrics to the internal MRO facility. However, the “satellite” component repair facilities further away from the internal MRO facilities culturally viewed their metrics differently, albeit likely unintentionally, having less line-of-sight on how their repair yield on parts influenced the network of internal MRO facility costs downstream. While senior executives had been communicating with facility management, the joint metrics and priorities appeared to not be effectively communicated down to production managers and operators.
Phase 3: Roadmap
Understanding the key insights, the team worked to develop technical and business recommendations for senior executive management that would lead to an increase in repair yield without negatively affecting other key areas and product lines. This included understanding how technology, including emerging, could be leveraged to produce real-time information for better tracking and decision making. The outcome of the Roadmap phase were based around key recommendations.
Key Recommendations
Establish a culture of collaboration across facilities
The team developed a regular rhythm of communication and sharing of best practices across all facilities. This action helped foster a culture of collaboration and sharing, instead of lack of communication and “gatekeeping” which was holding back the enterprise from increasing repair yields.Implement the fast, incremental solutions quickly
Many Lean experts will tell you that incremental solutions, even if the more impactful solutions are further off, is better than nothing. A few, quick solutions were implemented within a couple of weeks after identification, leading to an immediate impact by increasing repair yields by almost 40%.Champion the roadmap for technical improvements and innovations
The team identified and roadmapped technical improvements and innovations, including sharing of best practices, for the facilities. To champion these efforts, a clear roadmap, with business cases, was presented directly to senior executives with a call to action to implement the roadmap while mitigating any risks to other product lines.
Phase 4: Implementation
After the Roadmap phase, the team spent three months directing and implementing the details of the Roadmap. The results were well received by leadership, showing a return rate of 40X over the next decade, well past $30 million using conservative estimates, by implementing the business and technical solutions via the Roadmap. The project showed some key lessons.
Key Lessons
Component repair productivity can be enhanced greatly through collaboration across the value chain
A key factor to successful component repair yield and productivity is regular communication and collaboration with its network, whether “customer” MRO facilities or other internal component repair facilities. While cultural challenges may be present, collaboration guides improvements, shares best practices, and implements actions from key insights will help the firm overall in its quest for greater value creation.Involve all key functions in the project process, not just operations personnel
Day-to-day production managers and operators execute on the cleaning, inspection, and repair of parts, which can sometimes lead to blind spots that other team members from other functions may be able to see. By involving multiple team members from different backgrounds and functions, a more system-level approach is achieved in generating solutions and an effective Roadmap.Implement data standards and collection measures
The majority of the first two months was spent on gathering data in a digestible format due to differences in ERPs and storage of data. As discussed another Coeptis Consulting Group article, “Combating Exchange-of-Information Costs across Aviation MRO,” the exchange-of-information costs associated with gathering the right data, combined with misalignment of metrics at the different locations, created a lag in the Investigation and Roadmap phases, which in the aviation MRO space can be millions of dollars per month.
