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QUALITY IS FREE !

A&D SUPPLIER SUMMIT, SEATTLE

EMMANUEL MARQUIS – TRIGO GROUP

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Quality is free. It is not a gift, but it’s free. What costs money are the

unquality things, meaning not doing things right first time

Quality is basically what makes a product, or even a full aircraft, to be

delivered On Time and On Specifications, and last.

In the Aerospace world, quality may not always be a “first class” topic,

many others do : Engineering, Safety, Piloting skills …

INTRODUCTION–WHYARE WE TALKING ABOUT QUALITY?

Let’s talk about quality in the Aerospace supply chain,

because it is a profit making opportunity

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SUMMARY

INTRODUCTION

A supply chain perspective

Example of a cabin overhaul

A bottleneck situation

Quality consequences

How to handle quality issues

In paperwork we trust ?

Is inspection the answer ?

or source inspection ?

Do we have alternate solutions ?

Load/capacity assessments

A pure financial view

And let’s see if we can optimize it

CONCLUSION

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A SUPPLYCHAIN PERSPECTIVE

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BASE SCENARIO & CONTEXT–THE AIRCRAFT SUPPLY CHAIN

Let’s look at a cabin overhaul operation on a commercial Aircraft.

Airline( or Aircraft owner)

MRO(internal/external)

Procurement

Seats IFE Galleys Lightning

Floor Luggage Wiring & PipesSanitary

blocks

Globalized supply Chain

A planning challenge to

limit Aircraft downtime

Competition with A/C

manufacturers deliveries

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Manufacturing capacity is known, and flexibility takes time

A lot of craftmanship is involved, so training takes time

Overall astounding figures of new Aircrafts orders & deliveries

• Single aisle Aircrafts monthly figures

• Ramp up of Long range families

Customization is an aggravation factor

Increasing complexity is putting pressure on lead times. Design, certification,

and manufacturing is at the end of the cycle

SUPPLY CHAIN BOTTLENECK

Procurement of cabin elements is a sensitive topic

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Unrealistic schedules to gain market share

“Lag planning” behaviour

Flowdown in supply chain of end customer pressure, perturbative

effect

Unrealistic logistics issues, packing & unpacking, swapping ….

Over management of suppliers, slows everybody

Pressure on deliveries because of accumulated delays

SUPPLIER SITUATIONS

It’s neither On Time nor On Quality in the end

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HOW TO HANDLE QUALITY ISSUES

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Or we use only “qualified”

suppliers.• Yes, but the more you

pressurize on unrealistic

schedules, the worse it gets.

We have Part 21 or Part 145, so

everything is fine …• A part 21 is not an insurance

against late deliveries …

• A release certificate doesn’t

care about the cosmetics of a

leather seat

• And parts can be damaged

during expediting, handling,

installation, …

IN PART 21 WE TRUST ….

Let’s see what Quality control on parts, supplies

and cabin can do

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CON’S

• Can be expensive if

extensive

• Parts handling can be

complex

• Will not solve any delays

issues.

PRO’S

• Ease of implementation,

subcontract is possible

• Quality control by workers

on shop floor

• Protect the shop

• Tunable

Incoming inspection on all procured goods

SOLUTION : INSPECTION

Incoming inspection is a firefighting type action

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CON’S

• Geographic spread of

sources , Need local

presence

• Capability to deploy

multiple site/products

source inspections

PRO’S

• Stop problems at factory

level

• No logistics, customs,

packing overcosts

• Rework access

• Reduces part transit time

Source inspection on all procured goods :

Clear the shipment only if parts are validated

SOLUTION : SOURCE INSPECTION

Source inspection is a better option, but still a corrective one

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ALTERNATIVE SOLUTIONS

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CON’S

• Geographic spread of

suppliers

PRO’S

• Detection of production

bottleneck

• Planning consolidation

• Improvement plans are

anticipated

Input a little bit of preventive measures into a containment situation

provoked by firefighting

Do a load/capacity audit of your supplier before delivery

• Target the root cause : Is my supplier able to deliver on time?

ALTERNATIVE SOLUTION

In a supply chain bottleneck situation,

it is the best value for money

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A FEW FIGURESFOR A BUSINESS CLASS SEAT –VALUE 100K$

A Source inspection at

supplier factoryValue 300$ / seat

A supplier capacity audit Value 5000$

Impact 125 $ / seat

A cabin rework to

repair a defective unitValue 5000$ / seat

A late delivery penalty,

1% /day, 2 weeksImpact 15000$ / seat

Baseline on 40 seats batches.

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Can I really make relevant ppm measures on 1 A/C per month

How do I translate Craftmanship into figures ?

What if I transfer production ?.

Conventional methods for inspection

are based on expected quality level

Do I need to inspect 100% of items ?

Or sample ? Or mix ?

HOW TO SETTLE THE CONTROL PLAN : A CLASSICAL POINT OF VIEW

Consequences :

100 % inspection, Incoming or Source

Inflating checklists

Huge teams to handles NC’s

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TRIGO new methodology is based on overall financial impact

Input data

• Actual supplier quality level

• Cost of inspection per part

• Cost of defective parts going through inspection and being detected during

assembly, before customer delivery.

• Cost of a crisis with a customer due to “end of cycle” non detected defect.

Conventional methods for inspection

are based on expected quality level

Do I need to inspect 100% of items ?

Or sample ? Or mix ?

HOW TO SETTLE THE CONTROL PLAN : A FINANCIAL POINT OF VIEW

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SAVING COSTS

Provide data into the yellow cells (leave empty if not applicable)

Previous Global quantity recently inspected 500

inspections Defects found 5

Non Quality rate 0,01 1 %

Inspections to come Size of batches 50

Evaluated probability NQ / 10 0,02

Manufacturer's Evaluated probability NQ / 5 0,08

estimated profile Evaluated probability NQ / 2 0,10

Evaluated probability NQ stable 0,60

(Math. probabilities : Evaluated probability NQ * 2 0,10

from 0 to 1) Evaluated probability NQ * 5 0,08

Evaluated probability NQ * 10 0,02

Check sum = 1 1,00

Probable number of defects in one batch 0,73

Cost of an incident (a non detected defect) 10 000

Costs Unit cost of inspection (€ per part) 200

Fixed cost of setting up an inspection 2500

Period Define a period (number of months) 12

Number of batches to come within the period 20 Suggested size of sample : 45 Probable global cost per batch : 12 148 €

Cost of a quality crisis 200 000 Probable number of incidents on the batch : 0,04 Cost : 441 Probable global cost per part : 242,96 €

Crisis Risk of crisis on batch to come : Probable number of crises on the batch : 0,001 Cost : 207

(optional) Threshold (number of non detected defects) 2 Probable number of incidents on the period : 0,9 Cost : 8 823

Risk of crisis on the period to come : Probable number of crises on the period : 0,021 Cost : 4 136

Threshold (number of non detected defects) 5 Reminder : Rejection or 100 % inspection of batch must be applied at first defect found

0

10000

20000

30000

40000

50000

60000

0 10 20 30 40 50 60 70

Global cost

Cost of crises

Cost of incidents

Cost of inspection

Values for 1 batch

Costs / size of the sample

Calculating sample sizes for Business Class seats

Default rate 1%, Batch size 50 seats, rework 10K, crisis 200K

45 out of 50 safe solution is inspect all seats ...

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SAVING COSTS Calculating sample sizes for Economy Class seats

Default rate 0,5%, Batch size 250 seats, rework 2.5K, crisis 50K

65 out of 250 Cost optimization is one seat out of 4

Provide data into the yellow cells (leave empty if not applicable)

Previous Global quantity recently inspected 1 500

inspections Defects found 8

Non Quality rate 0,0053333 0,533 %

Inspections to come Size of batches 250

Evaluated probability NQ / 10 0,02

Manufacturer's Evaluated probability NQ / 5 0,08

estimated profile Evaluated probability NQ / 2 0,10

Evaluated probability NQ stable 0,60

(Math. probabilities : Evaluated probability NQ * 2 0,10

from 0 to 1) Evaluated probability NQ * 5 0,08

Evaluated probability NQ * 10 0,02

Check sum = 1 1,00

Probable number of defects in one batch 1,96

Cost of an incident (a non detected defect) 2 500

Costs Unit cost of inspection (€ per part) 50

Fixed cost of setting up an inspection 2500

Period Define a period (number of months) 12

Number of batches to come within the period 20 Suggested size of sample : 65 Probable global cost per batch : 8 119 €

Cost of a quality crisis 50 000 Probable number of incidents on the batch : 0,77 Cost : 1 933 Probable global cost per part : 32,48 €

Crisis Risk of crisis on batch to come : Probable number of crises on the batch : 0,009 Cost : 437

(optional) Threshold (number of non detected defects) 4 Probable number of incidents on the period : 15,5 Cost : 38 650

Risk of crisis on the period to come : Probable number of crises on the period : 0,175 Cost : 8 731

Threshold (number of non detected defects) 25 Reminder : Rejection or 100 % inspection of batch must be applied at first defect found

0

2000

4000

6000

8000

10000

12000

14000

16000

18000

0 50 100 150 200 250 300

Global cost

Cost of crises

Cost of incidents

Cost of inspection

Values for 1 batch

Costs / size of the sample

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Supply chain management should incorporate evolutive quality

inspection rules based on real data

Over inspecting & controlling may defocus suppliers

Absolute zero defect is not the most cost effective quality control goal,

optimal spending is different from optimal quality

CONSEQUENCES

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CONCLUSION In an era of supply chain bottleneck, Quality issue on the

production line is not a probability, it is a reality

Full inspection is a costly “last” line of defense meaning itmust be a firefighting measure only.

Protect your assets and save money : Invest in optimizedsource inspection, preventive measures & supplychain management : Invest in Quality !

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Q&A

THANK YOU!

Emmanuel Marquis

Managing Director

Aerospace & Heavy Transportation

www.trigo-group.com

emmanuel.marquis@trigo-group.com