Identify 20% savings to restore the profitability of an already certified and qualified aeronautical program

Our client has developed a complete avionics suite for one of the world’s two major aircraft manufacturers, consisting of “cockpit displays”, “on-board computers” and “control panels”.

This equipment has been qualified and certified by the various air safety authorities and the first dozens of shipset have been produced and delivered.

The ramp-up is in progress and stabilized series production is not planned until several years from now, but the best projection of the cost price reported by the teams is 20% below the profitability objectives of the program.

A multi-disciplinary project team (Programme – Studies – Purchasing – Industrialisation) is set up, and IAC is mandated by the Operations Department to structure and lead the savings research process, until their effective validation by the steering committee.

Over a short period of 5 months, the room for manoeuvre still existing is identified on 3 main levers:

Specification of need

• Certain costly provisions for growth potential are challenged
• The margins taken by the teams between the high-level performance specifications and the final dimensioning are investigated

Purchase

• Fit-Form-Function mechanical redesigns are proposed to allow access to less costly manufacturing processes
• Electronic redesigns are also put forward, freeing themselves from re-use constraints – the corresponding business cases are established with the teams

Achats

• Business buyers are challenged on their supplier productivity plan, and bypass strategies are implemented in two monopolistic situations

• 12% reduction in costs were validated and integrated during the 5 months of the mission
• 5% additional are identified to iso-specification and iso-design
• 16% additional redesign business cases are available
• 8% additional (33% gain in total) are identified but not considered accessible because at this stage of the project the software bricks of the product are too heavily impacting