Streamline to Remain Competitive

AMD: How has today's unstable economy affected aerospace job shops?

Dusty Alexander: The aerospace industr y faces many competitive challenges in today's economic climate.

Competing in a global market adds to the industry's challenges-the aerospace industry in particular faces stiff competition in cheaper labor found overseas.

Economic challenges aside, there are upsides for aerospace job shops. The major airlines are still projecting to build the same number of planes over the next two years as they had in their plans two to three years ago. The only market where we see a drop is private corporate jet demand, which is to be expected as companies look to cut unnecessary expenses.

Large aerospace companies such as Boeing and Lockheed Martin are outsourcing the majority of their parts of their new aircraft, leaving them better able to focus on design, testing and delivery of their products. The reason is simply cost effectiveness. This offloading of job work means that smaller manufacturers and assemblers can step in to fill the parts demand for the new designs major aircraft companies are producing.

AMD: What must aerospace job shops do to manage risk and remain competitive in today's uncertain market?

Alexander: To remain competitive in today's marketplace, aerospace job shops must adapt quickly to customer changes and seamlessly manage the process from the quote through on-time delivery. Implementing an Enterprise Resource Planning (ERP) tool can help job shops cut costs, improve sales and increase productivity.

For example, Global Shop Solutions has an aerospace customer with two companies with four facilities that manufacture exclusively for the airline industry.

Each facility is provided with a forecast of all parts their customers will need in the next 12 months and beyond. By inputting these orders into an ERP software solution, this customer was able to accurately predict what the labor demand would be for the year.

As a result, this customer has the advanced knowledge to plan accordingly and reduce any unscheduled overtime, plan budgets for new equipment and build preventative maintenance plans within the software-all helping to eliminate costly down time. ERP also helps project raw material purchases for the year, allowing the client to negotiate contracts with material suppliers.

It's these types of streamlined processes that allow manufacturers to be more reactive and remain competitive.

AMD: Please explain what ERP software is, and how it helps manufacturers to improve business.

Alexander: ERP software is a highly comprehensive, fully integrated software system that enables companies to manage the entire manufacturing process in real-time, from estimating and quoting work orders to final delivery and billing- all from one central location.

ERP cuts cost and boosts productivity by integrating all production processes into one cohesive system. This approach can improve on-time delivery and inventory control while simultaneously reducing administrative overhead. ERP streamlines manufacturing processes by increasing visibility throughout the organization.

AMD: What can manufacturers expect when implementing an ERP system for the first time?

Alexander: When properly implemented, ERP acts like a company-wide, ongoing process-improvement tool empowering the entire organization to become leaner, more efficient and, ultimately, more profitable.

The end result is a software system that integrates all essential activities of the business into one simple electronic package.

When you combine the right tool with the right training, ERP software can change the way business is done. For manufacturing companies, this directly translates into greater efficiencies and streamlined operations.

With ERP sof tware, shops know where they make and lose money, and can focus on what contributes most to their growth. The result is reduced costs, which in turn boost the bottom-line and can be passed on to customers, helping ensure their continued loyalty. When it's done right, ERP makes the complicated, often chaotic world of the job shop floor seem much simpler. More importantly, ERP helps companies compete for a larger share of the market, which is their ultimate goal.

Dusty Alexander is the President of Global Shop Solutions, a Woodlands, TX-based, family-owned Enterprise Resource Planning software provider.