Abstract
A major supply chain challenge in the commercial aerospace industry involves managing the supply of specific metallic alloys in a cyclical market. When the demand for new airplanes fluctuates, gluts and shortages of raw material may occur. As a result, several suppliers have been forced to rethink their business or to exit the industry. The impact on Boeing Commercial Airplanes is equally severe. Raw material shortages have increased expediting costs and have, in the worst cases, caused assembly line shutdowns.
Due to the serious nature of this market phenomenon, Senior Management in Boeing’s Commercial Airplane, Raw Material Procurement Organization commissioned the authors of this paper to study the problem and develop a workable, robust solution.
The authors’ primary objective was to develop methods and techniques that would be used collaboratively with the Commercial Airplanes supply base. Collaborative planning and forecasting should help reduce fluctuations in the supply chain amid fluctuations in the demand for commercial airplanes. As such, they should help generate planned demand for components and raw materials throughout the company’s supply chain. The tool should also help mills producing the raw material plan their capacity thus dampening oscillations felt throughout the supply chain.
This paper describes the results achieved thus far.
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Bilczo, T. et al. (2004). Aerospace Supply Chain Dynamics. In: The Practice of Supply Chain Management: Where Theory and Application Converge. International Series in Operations Research & Management Science, vol 62. Springer, Boston, MA. https://doi.org/10.1007/0-387-27275-5_18
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DOI: https://doi.org/10.1007/0-387-27275-5_18
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