Will My Supply Chain Survive COVID-19?
The commercial aerospace supply chain is writing. The sudden collapse, the spring passenger air travel after the outbreak of the latest novel Corona Virus and it's cove in Nineteen, disease has upended fortunes in the airliner manufacturing industry. That matters because commercial aerospace is responsible for about three quarters of the whole aerospace and defense sectors business activity. Cash is king right now throughout the supply chain and companies are struggling to have enough liquidity, according to what several advisors and analysts tell aviation week. while. Liquidity is more of a function of the wider economic downturn inside aerospace. There are even bigger challenges. Where production rates were once being pushed higher now a Williams are slashing them cascading pressure down the supply chain. At the L. A. M. in the top tier level. It has probably never been more important to have insight into your supply chain. Joining me to talk about that need, and what to do about it are John Schmidt? The Global Andy Lead at Accenture and Joyce Klein. Accenture leader in applied intelligence in the North American amd practice John Joyce. Welcome back. Thanks might go good to be back so John let me start with you. It seems obvious that OEM's and tier ones want insight into their suppliers. But while that was always true, I used to be about making sure that there were no bottlenecks that slowed or stop record high production now things chain what of new conditions that demand and customers pay better attention to their supply chain. Might go and in many ways the aerospace industry you know has a clear split between the companies that are working in the Corso world, and does indefens- you in the commercial. As you say, you know the concern used to be, we have a supply constrained world with very predictable demand, right always pushing for more trying take need those increased rates pushed by Boeing and. and Airbus and in the current world that's changed dramatically to being more of a supply volatile with unpredictable demand in the defense and space side of things you know things have largely remained in a predictable demand with an increased supply chain volatility, so by just keep looking at those things, predictability and the the constraint or volatility the spy chain. That's where the primary differences. And Commercial. We know that demand is going to be directly related to the bounce back of commercial air travel and the relative rates airlines choose to bring back stored aircraft versus take more efficient models on order from the OEM's causing more volatility in and demand, variability and defense. It's a bit different again. Demand Israel remained and the supply chains been impacted by Kobe in some cases they're tier one two or three companies, who source both commercial and defense or trying to generate cash to cover expenses and other cases, local Cobra outbreaks, and our common actions are impacting the spires ability to deliver on schedule, known both cases, aerospace and defense companies need. To deal with all totally like never before whether commercial or defense. So Joyce. Last time John and I talked here on Chuck six with. He kind of gave me the peak and do some new technology you all were working on. It's a new capability to peer into the supply chain including using an algorithm approach that allows more predictive insight, potentially even the ability to hotspot. What factories might be in trouble in the future? Can you tell us a little bit about what accenture is working on? And how does this work? Yes, absolutely Michael Accenture? We've been working with our clients in the supply chain area for many years using analytics and machine learning. In fact, if you go back to last year's pariser show in our accenture shall a. we had a digital showcase. Demo that focused on intelligence supply chain, and what this demo is a together machine, learning and artificial intelligence, and we used I at supply chain Europe e data to really understand delivery delays identify missing parts. We also looked at the opportunity for Automation Muller. Doing now is we're bringing together? All Lot of data sets and we're using artificial intelligence to help companies deal with the increase in volatility manage. Manage uncertainty and really get at supplier resiliency. That's really the core of what our solution is all about now so for North, America a and D client what we've done is we've taken and artificial intelligence engine that uses the supplier Jadot and what we're trying to do. We're actually working to predict the number of days late or a particular part, and we're doing that by bringing together a supplier. Number roaches order number eleven worry day in quantity, combination you all that information, Heather actually identify the number of as laid the opulent part is going to be and so by knowing the number of days way them. What were able to do is fight and determine. Do I have enough inventory? As coverage or that? Particular part is ultimately if I Joan I need to make additional decisions around production, and so what? We've been able to do with our solution. Experience up to ten percent improvement apart availability production. And we're also able to change the role of the delivery service analyst. Previous lanes individuals really operating. All here. Allergy by getting parts then wall really. Burning that role inches, someone that now uses ena an ai a better and improve sagem around artists that are going to chase I which parts are actually GonNa come in on Hind. So is a big ship in