Managing risk when ramping up

When conducting a rate readiness assessment of any supply chain, the process should be iterative. This is because most industries tend to use the same suppliers for certain core components or raw materials, so risks affecting their supply may only come to light after visiting a business further up the chain. If a weak point in the value chain is identified, it may be necessary for OEMs to shift their source of supply to mitigate the risk of disruption or establish a dual-sourcing arrangement. For good reason, moving products around the supply chain is often seen as costly and time consuming. However many ramp-up issues can be spotted based on previous performance.  Therefore, once a process and toolset is in place, reviews of this nature should ideally be used to monitor supply chain performance on an ongoing basis, so early action can be taken.

The aerospace and defence sector has not been immune to the well-documented issues surrounding labour and skills shortages and this has undoubtedly brought challenges for many organisations in recent months. However there are systemic, underlying factors that must be addressed if the industry is to truly learn lessons from previous rate increases.

The most common of these is load and capacity planning. For what is  largely a process driven industry, there exists huge variation in the way in which load and capacity planning is carried out. In both large and small organisations, greater focus in this area represents a significant opportunity to drive performance. Although businesses continue to spend millions implementing new ERP systems in the hope that they will solve problems in this area, many would achieve the same or better results through rigorous and consistent process application or better  use of data and analytics to understand and refine existing planning systems. There are also opportunities to improve collaboration between businesses, including the open sharing of data to enable lines of supply to be optimised.