Management Changes in MRO business through product lifecycle

Nowadays organizations and entire industries have faced the challenges of globalization and rapid technological development. These changes have brought new kind of competition and it has shaped and mixed organizations traditional business logic. This research is based on multiple case studies where the focus is on management changes through product lifecycle management. Emphasis is on MRO (Maintenance, repair, overhaul) providers and how they implement dynamic capabilities through product life cycle management. MRO is abbreviation for Maintenance, repair and overhaul and it is a commonly used in Aerospace industry. The study identifies several products in various stages of the life-cycle and thus identify the essential changes related to management. The stages that study identifies are Learning phase, Productisation phase and PBL phase. These phases can be used for clarifying dynamic capabilities in MRO markets.fi=vertaisarvioitu|en=peerReviewed

Power-by-the-hour: the role of technology in reshaping business strategy at Rolls-Royce

There is a recognised trend of manufacturing companies offering not only products, but services and even complete solutions to business problems. Research has highlighted economic, market demand and competitiveness factors as responsible for the re-shaping of business strategies that this has involved. This study analyses the extent to which another factor, technology, has been a significant factor in the switch from product oriented to service oriented strategies. A case study of the aero engine manufacturer Rolls-Royce is used to analyse the impact of technology, which is found to have led manufacturers to re-shape their business strategies. The study finds that developments in one technology in particular, namely digital electronics, have been a powerful enabling factor facilitating the implementation of service strategies. This provided original equipment manufacturers (OEMs) like Rolls-Royce with a competitive advantage relative to conventional service providers, by enabling them to acquire new knowledge management capabilities

ROLLS-ROYCE: A Circular Economy Business Model Case

This report presents the case study of Rolls-Royce’s ‘TotalCare’ business model for widebody aircraft aero engines. It was chosen due to the commercially successful development of a whole lifecycle, servitised value proposition and associated business model. Insights for business guidelines This case study highlights the following key insights relevant to companies in similar industries or sharing a similar context: Revenue mechanisms that align interests between a company and its customers can create powerful circular business models. Although Rolls-Royce engines are sold to the aircraft owner, the TotalCare service package means Rolls-Royce retains responsibility for ensuring the product performs to customer requirements. The power-by-the-hour charging mechanism (revenues generated per engine flight hour) keeps incentives aligned by rewarding Rolls-Royce when the product is working as needed, and penalising it when it is not. This mechanism and alignment between the OEM and its customers encourages continuous improvement and collaboration. This also drives the extension of asset lifetime while optimising/reducing repair and maintenance costs. This results in reduced waste, increased resource efficiency, and enhances the asset’s value over its lifetime. Service-focused offerings that enable manufacturers to gain insight and intelligence on the use and performance of their products can lead to better customer service, improved product/service design, and resource efficiency. TotalCare provides opportunities for constant insight and learning around customer requirements. This insight is enabled by the collection of engine usage and performance data, as well as through deep customer relationships. This produces ongoing improvements and evolution of the value proposition itself as well as expansion of value added services. This means that the customer is no longer buying ‘just’ a product, but gaining expanded value addressing a suite of needs and requirements. This provides greater flexibility for manufacturers to manage the underlying asset within a service contract, focusing on outcomes for the customer. Servitised performance-based models can be important enablers for ‘Resource Recovery’ as well as ‘Re-condition’ / ‘Re-make’ circular business model patterns. In the example of TotalCare, Rolls-Royce’s service contract includes the provision of maintenance services which it has the responsibility and flexibility to deliver in an optimal way. This ensures that the ‘life’ and utility of the engine product is kept at the right level over its lifetime. Furthermore, the service contract gives the manufacturer visibility of the product throughout its lifecycle. This is especially relevant at the end-of-cycle where it creates an opportunity for product take-back and recovery of high value materials through close-loop recycling. When transitioning from a product-focused to a service-focused business model, the installed base becomes a key asset and driver of revenue and profitability. In product-focused business models, revenue is driven by the product sales price, and potentially some recurring revenue from maintenance services and sale of consumables and add-ons. In a service-focused business model, the installed base of products in use can become the drive

Decision Analytics and Decentralized Ledger Technologies for Determination and Preservation of Spare Part Value in Aircraft Maintenance

Aircraft spare parts are used to quickly replace defective parts and ideally avoid expensive aircraft-on-ground situations. Understanding the Fair Market Value of surplus parts is of eminent importance for the competitive advantage of a company. Decisions such as purchase, sale, storage or scrapping are made on the basis of the determined value. Domain experts state that the value of a part depends significantly on its specific characteristics, condition and workshop event history. If the documentation of this history is incomplete, this can lead to a complete loss of value of the part, since, for example, safety-relevant parts may no longer be used without complete documentation. For companies that want to be able to survive in the highly competitive Maintenance Repair and Overhaul market, the use of digital technologies for data-based decision making has become unavoidable. The drowning of data while at the same time thirsting for information affects all market participants who manage their spare parts using digital technologies. The competitive advantage over others is now to use this data efficiently and make decisions based on data rather than experience and instinct. On the other hand, processes still exist in this industry that require documentation in paper form. One such process is the documentation of workshop events for safety-relevant spare parts by means of certificates. Low mutual trust and the heterogeneity of regional requirements in a global market prohibit the establishment of a central instance for data management. The determination of a Fair Market Value was carried out manually for a long time, with great personnel effort and low reliability. The design of an Automated Spare Part Valuation concept provides a basis for data owners to use the amount of data reliably. Similar implementations in industry and with integrated automated evaluation prove the usability. The problem of incomplete certificates of workshop events is addressed and solved by the conception, implementation and evaluation of a Blockchain-based Certification System. The characteristics of a blockchain, in particular its decentralization and persistence, meet the requirements that could not previously be met in an environment with a lack of trust and due to the danger of a single point of failure.Flugzeugersatzteile dienen dem schnellen Austausch von defekten Teilen und vermeiden im Idealfall teure Aircraft-on-Ground-Situationen. Das Verständnis für einen Fair Market Value der überschüssigen Teile ist von eminenter Bedeutung für den Wettbewerbsvorteil eines Unternehmens. Entscheidungen wie Kauf, Verkauf, Einlagerung oder Verschrottung werden auf Basis des ermittelten Werts getroffen. Domänenexperten geben an, dass der Wert eines Teils maßgeblich von seinen spezifischen Charakteristika, seinem Zustand und seiner Werkstattereignishistorie abhängt. Ist der Nachweis dieser Historie lückenhaft, so kann es zum vollständigen Wertverlust des Teils kommen, da etwa sicherheitsrelevante Teile ohne lückenlose Nachweise nicht weiter verwendet werden dürfen. Für Unternehmen, die in der Lage sein wollen im starken Wettbewerb des Maintenance Repair and Overhaul Markts zu bestehen ist der Einsatz digitaler Technologien zur datenbasierten Entscheidungsfindung mittlerweile unumgänglich. Das Ertrinken an Daten bei gleichzeitigem Verdursten an Informationen trifft alle Marktteilnehmer, die ihre Ersatzteile mittels digitaler Technologien verwalten. Der Wettbewerbsvorteil gegenüber anderen besteht nun darin, diese Daten effizient zu nutzen und Entscheidungen weniger nach Erfahrung und Instinkt, sondern datenbasiert zu treffen. Andererseits existieren auch in dieser Branche immer noch Prozesse, die eine Dokumentation in Papierform erfordern. Ein solcher Prozess ist die Dokumentation von Werkstattereignissen für sicherheitsrelevante Ersatzteile durch Zertifikate. Ein geringes Vertrauen untereinander und die Heterogenität regionaler Anforderungen in einem globalen Markt verbieten die Etablierung einer zentralen Instanz zur Verwaltung der Daten. Die Ermittlung eines Fair Market Value erfolgte lange Zeit manuell, unter großem personellen Aufwand und geringer Zuverlässigkeit. Die Konzeption eines Automated Spare Part Valuation Konzepts bildet eine Grundlage für Inhaber von Daten, um die Menge an Daten verlässlich zu nutzen. Ähnliche Umsetzungen in der Industrie und mit integrierter automatisierter Bewertung belegen die Einsatzfähigkeit. Das Problem der lückenhaften Zertifikate von Werkstattereignissen wird durch die Konzeptionierung, Implementierung und Evaluation eines Blockchain-based Certification System adressiert und gelöst. Die Eigenschaften einer Blockchain, insbesondere die Dezentralität und Persistenz, erfüllen die Anforderungen, die in einem Umfeld mit mangelndem Vertrauen und aufgrund der Gefahr eines Single Point of Failure, bisher nicht zu erfüllen waren

Standards and Specifications for Ground Processing of Space Vehicles: From an Aviation-Based Shuttle Project to Global Application

Proprietary or unique designs and operations are expected early in any industry's development, and often provide a competitive early market advantage. However, there comes a time when a product or industry requires standardization for the whole industry to advance...or survive. For the space industry, that time has come. Here, we will focus on standardization of ground processing for space vehicles and their ground systems. With the retirement of the Space Shuttle, and emergence of a new global space race, affordability and sustainability are more important now than ever. The growing commercialization of the space industry and current global economic environment are driving greater need for efficiencies to save time and money. More RLV's (Reusable Launch Vehicles) are being developed for the gains of reusability not achievable with traditional ELV's (Expendable Launch Vehicles). More crew/passenger vehicles are also being developed. All of this calls for more attention needed for ground processing-repeatedly before launch and after landing/recovery. RLV's should provide more efficiencies than ELV's, as long as MRO (Maintenance, Repair, and Overhaul) is well-planned-even for the unplanned problems. NASA's Space Shuttle is a primary example of an RLV which was supposed to thrive on reusability savings with efficient ground operations, but lessons learned show that costs were (and still are) much greater than expected. International standards and specifications can provide the commonality needed to simplify design and manufacturing as well as to improve safety, quality, maintenance, and operability. There are standards organizations engaged in the space industry, but ground processing is one of the areas least addressed. Challenges are encountered due to various factors often not considered during development. Multiple vehicle elements, sites, customers, and contractors pose various functional and integration difficulties. Resulting technical publication structures and methods are incongruent. Some processing products are still done on paper, some electronic, and many being converted in between. Business systems then are not fully compatible, and paper as well as electronic conversions are time-consuming and costly. NASA and its Shuttle contractors setup rules and systems to handle what has produced over 130 RLV launches, but they have had many challenges. Attempts have been made to apply aviation industry specifications to make the Shuttle more efficient with its ground processing. One efficiency project example was to make a Shuttle Maintenance Manual (SMM) based on the commercial ATA (Air Transport Association of America) Spec 100 for technical publications. This industry standard, along with others, has been a foundation for efficient global MRO of commercial airlines for years. A modified version was also made for some military aircraft. The SMM project found many similarities in Spec 100 which apply to the Shuttle, and room for expansion for space systems/structures not in aircraft. The SMM project team met with the ATA and representatives from NASA's X-33 and X-34 programs to discuss collaboration on a national space standard based on Spec 100. A pilot project was enabled for a subset of Shuttle systems. Full implementation was not yet achieved, X-33 and X-34 were cancelled, and the Shuttles were then designated for retirement. Nonetheless, we can learn from this project how to expand this concept to all space vehicle products. Since then, ATA has joined with ASD (AeroSpace and Defence Industries Association of Europe) and AIA (Aerospace Industries Association) to form a much-enhanced and expanded international specification: Sl000D, International Specification for Technical Publications. It includes air, land, and sea vehicles, missiles, support equipment, ordnance, and communications. It is used by a growing number of countries for commercial and government products. Its modular design is supported by a Common Source Dabase (CSDB), and COTS (commercial off-the-shelf) software is available for production of IETP's (Interactive Electronic Technical Publications). A few space industry products in Europe have begun to apply Sl000D already. Also, there are other related standards/specifications which have global implications. We have an opportunity to adapt Sl000D and possibly other standards for use with space vehicles and ground systems. Sl000D has plenty of flexibility to apply to any product needed. To successfully grow the viability of the space industry, all members, commercial and government, will need to engage cooperatively in developing and applying standards to move toward interoperability. If we leverage and combine the best existing space standards and specifications, develop new ones to address known gaps, and adapt the best applicable features from other industries, we can establish an infrastructure to not only accelerate current development, but also build longevity for a more cohesive international space community

Improving root cause analysis through the integration of PLM systems with cross supply chain maintenance data

The purpose of this paper is to demonstrate a system architecture for integrating Product Lifecycle Management (PLM) systems with cross supply chain maintenance information to support root-cause analysis. By integrating product-data from PLM systems with warranty claims, vehicle diagnostics and technical publications, engineers were able to improve the root-cause analysis and close the information gaps. Data collection was achieved via in-depth semi-structured interviews and workshops with experts from the automotive sector. Unified Modelling Language (UML) diagrams were used to design the system architecture proposed. A user scenario is also presented to demonstrate the functionality of the system

USAF Aircraft Maintenance Officer Knowledge, Skills and Abilities and Commonalities among the Logistics Officer Corps

This study investigated options to improve 21A training and education by first validating the Air Force\u27s logistics mission sets as Deployment, Distribution, Supply Management, Repair Network Integration, Mission Generation, Lifecycle Logistics and Joint Logistics. Then, the Knowledge, Skills, and Abilities (KSAs) considered important to execute each mission set were gathered from a representative sample of Air Force Logistics Officers via field interviews and focus groups. An analysis of results categorizes probable needs (high, medium, low) of KSAs for each mission set and assesses how well they are currently taught, if at all. Additionally, lists of KSAs that overlap multiple mission sets were created along with process options for integrating them into training and education. Based on a discussion of the synergistic effects on acquiring these KSAs, it is also recommended that the Logistics Readiness Squadron be realigned under a common group at the operational wing with the rest of the Logistics Units (presently the Maintenance Group). Finally, a career tracking model is proposed to deliberately build experts in strategic 21A career paths, which this study identifies as Career Maintenance Officers, Air Force Materiel Managers and Joint Logistics Officers

An off-line dual maximum resource bin packing model for solving the maintenance problem in the aviation industry

In the aviation industry, propeller motor engines have a lifecycle of several thousand hours of flight and the maintenance is an important part of their lifecycle. The present article considers a multi-resource, priority-based case scheduling problem, which is applied in a Romanian manufacturing company, that repairs and maintains helicopter and airplane engines at a certain quality level imposed by the aviation standards. Given a reduced budget constraint, the management’s goal is to maximize the utilization of their resources (financial, material, space, workers), by maintaining a prior known priority rule. An Off-Line Dual Maximum Resource Bin Packing model, based on a Mixed Integer Programming model is thus presented. The obtained results show an increase with approx. 25% of the Just in Time shipping of the engines to the customers and approx. 12,5% increase in the utilization of the working area

Enhancing competitive advantage through successful lean realisation within the Aviation Maintenance Repair and Overhaul (MRO) industry

Purpose: Lean is increasingly being applied within the aviation Maintenance and Repair (MRO) Industry to mitigate industry challenges. This Lean application is premised on its success within other industrial contexts particularly the automotive industry. Furthermore, many organisations within automotive industry have attributed their enhanced competitive positioning to the Lean application. Indeed, Toyota (a pioneer of Lean) present Lean as a key proponent to its global success. However, with literature suggesting that there cannot be a direct transference of Lean from one industry to another and with the MRO having distinct characteristics different from the automotive industry, this research seeks to present how competitive advantage can be achieved through successful Lean realisation. Design/Methodology/Approach: The status of MRO Lean engagements presented is first presented based on the syntheses of literature review and empirical study (facilitate by an industry-wide survey). The means through which the MRO realises its value proposition is established and the structural assessment of the MRO industry as it pertains to competitiveness is also defined. The role of Lean in enhancing the value delivery system to enhance competitive positioning is operationalised through a case study. Findings: Using Porter’s forces of competition, this research establishes the competitive MRO landscape revealing the distinct characteristics of the MRO industry and how Lean can be accurately appropriated to enhance competitive advantage. The MRO Value Delivery System (VDS) is also delineated providing the complete system within which Lean is to be deployed (as opposed to the prevalent limited application of Lean in operational context alone). The case exemplar successfully validates and operationalises the approach to Lean application within MRO to enhance competitive advantage. Research Limitations: A case study example was used for this research, and whilst the outcomes were consistent with the research proposal, it still requires wider validation. Practical and Social Implications: This research demystifies and helps MRO organisations in assessing their Lean engagements but also in provide a roadmap and informs their strategy in improving their competitive status through Lean realisation