Thursday, September 4, 2008

Austrian, Zoom and the data challenge

Bankruptcies, mergers, and acquisitions such as Zoom, Iberia and Austrian prove the need for enterprise asset management (EAM) and maintenance repair and overhaul (MRO) systems to be more than just effective, they also need to be virtually portable and a source of competitive advantage.

Looking at a friendly move such as the proposed alliances at Austrian gives some idea of the challenge. According to Austrian's current website, the group is flying about a dozen types different types including Airbus 321 / 320 / 319, Boeing 777 / 767 / 737, Fokker 100 / 70, Bombardier Q400 / Q300 and Canadair across a fleet of almost 100 aircraft. Most likely some of these aircraft are heavily dependent on outside maintenance providers, some of the powerplants may be running on a power by the hour basis some not, some aircraft or major components will have real time performance monitoring and data transfer and others may have little support technology behind them.

All of this adds up to a very normal situation where the data concerning the main operating assets are held in multiple databases, many of which are not connected and some may be outwith the company's ability to easily access

One of several suitors, most probably Lufthansa will have to integrate the Austrian operation into their own and generate worthwhile operational savings to help justify the investment. The lifecycle cost of managing the fleet will need to find a significant contribution to those savings. Whoever can manage that integration most effectively find and exploit savings in key areas will be able to build the most convincing business case and create the clearest competitive advantage.

This brings the portability of not only the data, but the data management processes themselves into the front line of business decision making at the corporate level as well as operationally.

Monday, August 25, 2008

Configuration Management. A Wikipedia definiton

Configuration Management is the process used to maintain an understanding of the most up to date status of complex assets with a view to maintaining the highest level of serviceability for the lowest cost. Specifically it aims to ensure that operations are not disrupted due to the asset, or parts of the asset overrunning limits of planned lifespan or below quality levels.

Understanding the “as is” state of an asset and its major components is an essential element in preventative maintenance as used in maintenance repair and overhaul (MRO) and enterprise asset management (EAM) systems.

Complex assets such as aircraft, ships, industrial machinery etc. depend on many different components being serviceable. This serviceability is often defined in terms of the amount of usage the component has had since it was new, since fitted, since repaired, the amount of use it has had over its life and several other limiting factors. Understanding how near the end of their life each of these components has been a major undertaking involving labor intensive record keeping until recent developments in software.

Many types of component use electronic sensors to capture data which provides live condition monitoring. This data is analyzed on board or at a remote location by computer to evaluate its current serviceability and increasingly its likely future state using algorithms which predict potential future failures based on previous examples of failure through field experience and modeling. This is the basis for “predictive maintenance”.

Availability of accurate and timely data is essential in order for CM to provide operational value and a lack of this can often be a limiting factor. Capturing and disseminating the operating data to the various support organizations is becoming an industry in itself.

The consumers of this data have grown more numerous and complex with the growth of programs offered by original equipment manufacturers (OEMs) such as the TotalCare program developed by Rolls Royce aero engines. These are designed to offer operators guaranteed availability and make the picture more complex with the operator managing the asset but the OEM taking on the liability to ensure its serviceability. This has created a situation where individual components within an asset may communicate directly to an analysis center provided by the OEM or an independent analyst.

Friday, August 22, 2008

Who will select your next EAM or MRO IT system?

One of the constraints holding back the adoption of new IT tools in managing aviation assets seems to be the way that previous systems were selected and deployed. Selecting Enterprise Asset Management (EAM) and Maintenance Repair and Overhaul (MRO) systems usually took a huge amount of time and effort from across the organization, but once the software was in place, it was invariably down to front line managers in Operations to make it work.

This meant that once a system went live Operations management often had to make their practices fit the software and frequently find work-around solutions to bridge gaps on what the system really should be doing. Having to find a system that fitted the requirements of both Operations and the IT department was a major reason for this compromise, but this may now be changing for two reasons.

First, the role of the CIO seems to be changing. The IT gurus at Gartner Consulting carried out their “CIO Agenda” review for 2008 and make the claim from their findings of over 1,400 CIO interviews that the role of IT will become overwhelmingly about delivering business value rather than simply looking after the technology side. Supporting this is the fact that the priority for “creating new products or services” has gone from last year’s number 10 priority to number 3 this year.

So does that mean that IT departments will actually take on more authority for selecting systems such as MRO and EAM software? Not according to Gartner who in another report concerning future trends claim that as technology develops and becomes more ubiquitous it actually becomes more accessible to non-IT users narrowing down the great technological cloud of unknowing that only the IT department could comprehend. This is something they call the “consumerization of IT”.

So according to the experts, it looks as though how we select IT systems for future Enterprise Asset Management (EAM), Configuration Management and Maintenance Repair and Overhaul (MRO)requirements will be a lot more user friendly and our IT departments a lot more business value focused than in the past.

Thursday, August 21, 2008

China and India lagging

Why are the developing economies of India and China still lagging in terms of building their aviation industries compared to other sectors? Many players including Pratt, GE, Airbus and Boeing are beginning to invest in assembly and production in both India and China, but so far this has remained small.

McKinsey group has produced a report which shows that Russia, China and India originate around 3% of aerospace output in compared to 33% for automotive, 18% for large industrial equipment. Given the their large domestic civil and military markets and the clear cost advantages in terms of labor it seems there is a mismatch with 97% of production still coming from the high cost west. Much of the 3% is in fact “offset” production so it is almost fair to say that some of the largest and fastest growing economies have virtually no aerospace market.

Several reasons seem to exist for this including western reluctance to outsource an industry so closely related to defense, regulatory constraints, intellectual property, but the lack of capability to manage data from multiple sources for multiple end uses for multiple users is also a showstopper as far as technology and IT infrastructure goes..

Lifecycle management for all types and major components now need data-rich IT systems and without them they will continue to struggle to provide the levels of aftercare necessary to meet operators expectations.

So what holds them back from adopting this type of system? It is hard to find any solid research to this, but is seems likely that the very focus on manufacturing that has allowed them to develop quickly in other industries has worked as a brake to them adopting full life cycle approach to aviation. The Enterprise Asset Management (EAM) wave has yet to hit.