Strategic Inventory Solutions for the Aerospace & Defense Industry

rocket launches into the sky, leaving a trail of smoke behind it.

The Aerospace and Defense (A&D) industry in the United States is unlike any other. It is comprised of myriad different sectors that continually push the boundaries of science and technology, including: commercial and general aviation, military aircraft design and manufacturing, commercial and governmental space systems, on-the-ground military defense, and shipbuilding. And though it’s only about 100 years old, it’s absolutely massive; in fact, the A&D industry has an astonishing economic impact on America, supporting almost three million jobs and generating over $600 billion in sales in the year 2015 alone.

Naturally, an industry of this size and scope has unique needs when it comes to inventory management. From sourcing raw materials to finding skilled workers, these challenges can make it difficult to produce goods of necessary quality in an efficient and effective manner. Many different industries can make use of an inventory management platform, but organizations in the A&D industry also require highly strategic solutions to successfully manage not only their inventories, but their entire supply chain and manufacturing processes.

Why Do Aerospace Manufacturers and Engineers Need Inventory Control?

Both private and government-run organizations in the A&D industry need inventory control, including asset tracking, user rights, and comprehensive bills of materials. Many aspects of this industry are heavily regulated by internal best practices, as well as by the federal government, to ensure the engineers and manufacturers are able to design and produce goods that are safe to use. Regulations set by the federal government “cover numerous aspects of the supply-chain and include materials usage, counterfeit parts, manufacturing procedures, hiring practices and other aspects of the industry.” Engineering and manufacturing in the A&D industry both require extreme proficiency and precision; without inventory control, it can be difficult, if not impossible, to meet those standards.

These regulations are crucial to the success of this industry, ensuring that the goods it produces are safe for people to use. Without them, anyone could manufacture these highly specialized goods and sell them to unsuspecting consumers, regardless of whether they were safe or functional. For everyone who interacts with the A&D industry, from the members of the military protecting the US to airline passengers, the effects could be devastating, if not life-threatening.

Even when organizations comply with external regulations, there is still potential for disaster. Any oversights, mistakes, or failures on the part of engineers and manufacturers can have the same adverse consequences for anyone involved. This is exactly why an accurate and effective inventory management solution is so vital to organizations in the A&D industry — it can help mitigate those mistakes and ensure the design and manufacturing process goes as smoothly as possible.

Aerospace Supply Chain Management Issues and Solutions

The A&D supply chain is large and intricate, which can make it hard to manage. This gets even more difficult when faced with obstacles that may be common but remain difficult to solve. However, even the most frustrating or seemingly-impossible issues with A&D supply chain management can be solved. Some of the most pressing problems in the A&D supply chain include:

RAW MATERIAL SOURCING

Sourcing raw materials can be difficult in any industry, but it’s a particularly tricky issue for manufacturers in A&D. Much of the goods produced in the A&D industry require highly valuable resources, including rare metals like steel, nickel, and aluminum, as well as wood, rubber, textiles, and chemicals. These raw materials come from different locations all around the world, and no one region, country, or entity is in control of them. Further, the availability of these raw, natural resources can change depending on political disruptions or geo-climate events.

Finding materials at the right cost, ensuring the correct delivery timeline, and maintaining relationships with reliable distributors are problems in and of themselves that can be hard to track. A powerful asset tracking solution can help A&D manufacturers maintain control over the logistics of sourcing raw materials and automate many aspects of this entire process. This also provides manufacturers with more time to focus on solving supply chain and materials sourcing issues that can’t be automated or streamlined.

DISRUPTION RISKS

Again, the A&D supply chain is large and complex, which can make it susceptible to disruptions; some may only be minor interruptions, but others may be enough to bring entire projects to a standstill. Inaccurate forecasting, incorrect pricing projections, sudden or significant design changes, upsets with distributors or suppliers, and political or geo-climate events are some of the many common disruption risks that can affect the A&D supply chain.

There are some disruptions that are simply beyond the control of A&D manufacturers and engineers. For instance, if an area where rubber is commonly sourced is hit by a natural disaster, there isn’t much that can be done while that area works to recover from it. However, there are some disruptions that can be mitigated, and an all-encompassing manufacturing platform can help with risks related to forecasting, order management, parts tracking, and more. Similar to dealing with problems related to sourcing raw materials, there are so many disruption risks that are truly unforeseeable and uncontrollable; A&D manufacturers should focus on what they can control to help keep operations run as smoothly as possible.

EMERGING TECHNOLOGIES

Technological advancements are hugely important to the entire A&D industry and are largely responsible for making it as significant as it is today. However, technologies change significantly and rapidly, and can interrupt the supply chain as A&D engineers and manufacturers struggle to integrate them into their daily work. Common technological issues that affect the supply chain include automation, moving records and materials from a physical to a digital format, glitches with software, and delays with new products or inventions.

A&D manufacturers and engineers have to find the right balance between incorporating emerging technologies and relying on human capabilities in their supply chains. New technologies can be exciting, but they aren’t always the best, most dependable, or right option. In many situations, automation can be highly beneficial, but it’s important for A&D manufacturers and engineers to know when human workers can perform the same task just as well as, or better than, new technologies. Making use of all available resources will ensure that manufacturers have someone they can trust to get the job done if their newly integrated technologies don’t work as well as expected.

LIMITED SKILLED WORKERS

The A&D industry has continually and consistently grown from 2010 to 2018, and shows no sign of slowing down in the near future. While this growth is exciting, it has lead to an increased demand for employees who are qualified to work in this highly-specialized industry. Though the A&D industry employed over 2.5 million people in 2018 alone, there is still a need for workers who are experienced in this field, trained to handle new technological advancements, and able to refine their skill sets as the industry develops.

A&D manufacturers and engineers must focus on expanding and developing their human capital in order to meet this increased demand. As technologies emerge and procedures change, employees will need continual training to ensure they have the knowledge and expertise necessary to do their jobs. Finding the right balance between well-trained employees and high-tech solutions will ensure that the A&D supply chain runs efficiently as the industry continues to grow.

Each piece of the supply chain, from the raw materials used to make products to the employees who craft them, works together to make the A&D sector as successful as it is today. Inventory management, in particular, is a crucial aspect of this entire industry. In order to maintain current levels of production, A&D manufacturers and supply chain managers must prioritize effective inventory management solutions. Further, it’s an absolute necessity for all organizations who want to see even more growth and success in the A&D industry in the coming years.

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