Pacific Aerospace gains competitive edge

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Published on the 26/11/2013 | Written by Infor

AT A GLANCE

Pacific Aerospace

INDUSTRY

Aircraft manufacturing and maintenance.

BUSINESS OBJECTIVE

To support lean management.
To integrate manufacturing, sales, financials.
To provide audit trail for parts and components.

SOLUTION

Infor LN ERP (formerly BAAN).
Supporting infrastructure on a Microsoft SQL database.
Project specification, installation, configuration and support provided by EMDA.

THE BENEFITS

Significant improvement to productivity with no operating cost increases.
Multi-currency supports exports.
Parts tracked from source through manufacture and delivery.
System support for continual improvement.

FOR MORE INFORMATION

INFOR
W: INFOR
T: +61 2 9021 7100

PARTNER CONTACT

EMDA
W: EMDA
T: +64 9 921 6600 or
T: +64 3 343 0023
E: info@emda.co.nz

The Kiwi aircraft manufacturer has re-engineered its business with Lean management and a new ERP system to create a solid runway for global export success…

Pacific Aerospace (PAL) is one of New Zealand’s rising stars in the export market. With multi-million dollar contracts for their class-leading P-750 XSTOL utility aircraft in the pipeline, PAL is poised for significant growth. “We expect to increase our production output significantly,” says Damian Camp, CEO of the Hamilton-based manufacturer, “with much of that increase coming from efficiency gains. We are now working leaner, cleaner and more efficiently due to our system of continuous improvement. All of these initiatives, including our new ERP software, Infor LN, are rolled together in what we call PACE (Pacific Aerospace Competitive Edge). PACE is our Lean Manufacturing programme which has hugely transformed the way we do things and how efficiently we do them.”

Turbulent times
It hasn’t been an easy road for PAL. In 2006, the company, then under different ownership, was under pressure and needed to increase its output to meet market demand. Camp was appointed to stabilise the business introduce better business procedures and reposition the company and its products in the market.

“We embraced the ‘Lean’ philosophy, which calls for reduction of ‘waste’ across the company including movement of parts, overstocking, rework, access to tools and resources, In addition we established an OFI (opportunities for improvement) programme and adopted the ‘5S’ framework (sort, set in order, shine, standardise, and sustain) in which we re-organised our work habits and work spaces. This model alone saved us from having to add new floor space as we were able to maximise the utilisation of our existing facilities. Eventually, all of these processes coalesced into the PACE methodology which we adhere to religiously.”

“As we developed PACE, we refined our business processes,” explains Camp, “but we didn’t have a truly integrated IT system to give us a unified view of the company across finance, manufacturing and sales.

One of our regulatory requirements is traceability of parts during the manufacturing process and for the life of an aircraft. We needed to know exactly where each part came from, how it was manufactured and even from which batch of material it was fabricated from. With more than 4000 parts and components per plane, it was a key consideration for us.”

Start stop
Over the course of several months, an internal team detailed exactly the company’s requirements including capabilities for manufacturing, parts control, audit and financials. “Of the several RFP responses,” explains Camp, “the proposal from EMDA built around Infor LN was the one that most aligned with our requirements. We felt that they could work within our PACE framework and the capabilities of the software were optimised for the aerospace industry with a track record of successful implementations.” PAL also found LN’s multi-currency capabilities attractive as well as the fact that EMDA would specify, install, configure and support the necessary hardware.

Once the decision was made to contract EMDA to proceed, the project went on hold. “At that time we just couldn’t justify the expenditure,” notes Camp. “Once the market turned around we took it up again and now we are realising concrete benefits from the new system.”

Clear air
“From an installation perspective,” says Tony Vile, senior consultant with enterprise software specialists EMDA, “the PAL project was a smooth operation. They were very specific in what they wanted and had developed a detailed incremental implementation schedule. Once the initial delay was behind us, we moved quickly on getting them up and running. Their business processes were quite sophisticated but we were able to help them map their data and routines almost directly into the Infor LN framework. We ran a number of workshops and training sessions with the idea of empowering PAL staff to take ownership of the solution once it had been set up.”

“We tried to avoid excessive customisation,” says Camp, “for instance, we would change some of our processes to fit into the LN schema. At the same time we could configure LN to reflect our own unique requirements. The team at EMDA were extremely supportive to this approach and their expertise in developing routines was instrumental in the project’s success.”

One off
One particular capability of Infor LN that PAL is employing is the Product Configurator. “Each aircraft is unique,” explains Camp, “and specifying each individual component is an integral part of the sales, manufacture and maintenance process. With Configurator, we can build the plane ‘on paper’ and prepare a bill of materials. We can weed out incompatible optional extras, which saves a lot of time during the specification phase. And once the parts have been identified, we can proceed with pricing and then manufacturing. The aircraft fitters and engineers have to be confident that the parts they use are the right ones. There is no margin for error and Infor LN goes a long way in ensuring the highest levels of product integrity.”

Continual improvement
PAL is still navigating the functionality of Infor LN. “Our focus on Lean operations means that we don’t do everything at once,” concludes Camp. “We’re building capabilities in business intelligence and product lifecycle management. We like the ability of Infor LN to expand our manufacturing capacity without adding extra layers of management. It fits very well within our overall PACE and Lean frameworks. To EMDA’s credit, they have worked with us to our own schedule and requirements and have added significant value every step of the way. We are working on two large overseas orders for the P-750 XSTOL and we have every confidence that we will be able to produce them, using Infor LN as a basis, quickly, correctly, and most importantly, profitably.”