New set of universal metrics for the UK aerospace industry

Citation

Murden, G. (2001), "New set of universal metrics for the UK aerospace industry", Aircraft Engineering and Aerospace Technology, Vol. 73 No. 1. https://doi.org/10.1108/aeat.2001.12773aaf.002

New set of universal metrics for the UK aerospace industry

New set of universal metrics for the UK aerospace industry

Keywords: Aerospace industry, Measurement

At a time when UK aerospace companies should be considering long and hard how they can ensure a leading position in the world market, the UK Lean Aerospace Initiative (UK LAI) has launched a new set of performance measurements to evaluate UK aerospace companies' "lean health". This initiative does not come a moment too soon as competitors around the world are recognising the enormous benefits of lean working. The new metrics are intended as a practical guideline for companies on how to become leaner and achieve continuous improvement. The launch marks one of the biggest initiatives to date in the UK LAI's drive to improve the competitiveness of the UK's aerospace sector and the new metrics are being promoted to encourage take-up across the entire industry.

The UK LAI is part of the Society of British Aerospace Companies' (SBAC) Competitiveness Challenge (CC) and set out, in April 1998, to support member companies in meeting their improvement objectives, by providing training and research in this area. Supported by a leading university group consisting of Warwick, Bath, Cranfield and Nottingham, the UK LAI combines academic research with practical solutions.

Consequently, since 1998, the UK LAI has initiated a wide range of programmes to help the aerospace industry to become more productive and to implement best practice manufacturing and operations process across the sector. Its aim is to achieve dramatic and sustainable improvements in the quality, cost and delivery of UK aerospace companies' products and, ultimately, world-leading competitiveness for the industry sector.

As a key tool to assist progress towards this goal, the six new performance measures have already been piloted successfully and taken up by some key companies in the sector including Rolls-Royce plc, Smiths Industries, SPS Technologies and Dowty Aerospace Propellers. The set of metrics will enable UK aerospace companies to measure effectively their performance and the efficiency of their supply chain and it is intended that they will be adopted collectively to facilitate the development of a culture dedicated to improvement across the industry.

Michael Jones, Group Director of Smiths Industries Aerospace and Chairman of the Metrics Working Group, which has driven forward the initiative, commented:

This new set of metrics comes at a crucial time for the UK Aerospace Industry. Now, more than ever, it is vital that we implement measures to evaluate performance and encourage a national culture of continuous improvement across the aerospace sector. These metrics will provide an invaluable tool for companies to set themselves on the road to improvement and enhanced overall competitiveness.

Much effort has been taken to ensure that the metrics reflect the interests of a cross section of the aerospace industry. To achieve a practical set of measurements thorough research was undertaken by the UK LAI, in collaboration with a variety of UK aerospace companies and members of the School of Management at the University of Bath. While some of the leading primes in the UK were among the pilot companies, there were equally a number of smaller aerospace companies that contributed to the research and the final product – ensuring representation from all areas within the sector.

Significantly, it is not only UK companies which stand to gain from the UK LAI work on metrics, since the US Lean Aerospace Initiative is showing a close interest in the UK LAI's achievements. Close collaboration is ongoing and researchers from both countries exchange their findings on a regular basis, but it is the UK LAI that is setting an example in the achievement and implementation of tangible results.

Focusing on the six main metrics will help companies to implement changes and support the UK aerospace industry to become more competitive. In order to make the measures user-friendly, the UK LAI has issued a booklet, which lists them in an easy-to-use format. Each metric is explained in detail and the metrics have also been incorporated into a wall chart and a pocket-sized card for quick reference.

The six metrics cover a range of aspects in the manufacturing process:

1. 1.

   The "customer acceptance/reject rate", which helps you to measure your customers' satisfaction with the products you manufacture for them.

2. 2.

   Linked to this is the second metric "delivery schedule achievement", which is a crucial aspect of performance, impacting on customer satisfaction as well as on your company's cash flow.

3. 3.

   The "value added" measurement makes you look at value from the customer's point of view, but also asks you to search for and identify areas of waste within your organisation. These need to be eliminated if they do not add any value to the end product.

4. 4.

   In order to achieve this, "employee training and development" needs to be highlighted. As society moves towards knowledge-based organisations, your employees' knowledge can be a competitive advantage.

5. 5.

   One of the corner-stones of lean manufacturing is the "stock turns" – increasing stock turn can have substantial benefits in reducing inventory and lead time, while increasing cash flow.

6. 6.

   In order to achieve an improvement in the process flow and optimise the facilities, "floor space utilisation" can provide a valuable insight into the impact of improvement activities.

It is important to point out that many of these measures have been designed not as a stand-alone tool but to complement existing business approaches, including the new European Foundation of Quality Management (EFQM) excellence model, the balanced scorecard and the lean enterprise model. The LAI metrics brochure is a helpful starting-point for companies and also acts as an introduction to a wider catalogue of aerospace-focused metrics that support the six core metrics. These are listed in the brochure and are soon to be published on the UK LAI Web site. Companies can therefore tailor a performance measurement system that is appropriate to their individual needs and will work throughout its supply chain.

The LAI MasterClass Programme has been using these measures effectively for some time when implementing changes and measuring improvements in companies. The programme, which is a joint venture organised by the Society of British Aerospace Companies (SBAC) and partly funded by the DTI, is another tool available to the UK Aerospace Industry to increase its competitiveness. Using a tailored model from the SMMT to streamline manufacturing and production processes, the MasterClass Programme aims to achieve continuous improvements in areas of quality, cost and delivery. Pilot projects run during 1999 testify to its success so far – space savings of up to 25 per cent, 15 per cent increased productivity, reductions in set-up time of 40-85 per cent; and 90 per cent reductions in the shopfloor distance travelled, have all been recorded.

Simultaneously, the UK LAI is establishing a Web-based "best practice centre" to underpin the improvement process – by capturing explicit knowledge and facilitating rapid access to best practice guidelines and techniques. The UK LAI's aim is to help the UK aerospace industry by providing programmes that go hand-in-hand and will result in companies being able to stay ahead in the competitive aerospace market.

Details available from UK LAI. Tel: +44 (0) 20 7227 1083; E-mail: gary@sbac.co.uk

Gary MurdenUK LAI Programme Manager