The Covid-19 pandemic certainly shook the aviation industry’s supply chain to its core, nearly paralyzing companies for a time.
The situation has been exacerbated further by other disruptive events such as the Russia-Ukraine war, labor shortages, unforeseen demand spikes, and geopolitical tensions, which continue to add strain to an already fragile supply chain landscape.
It’s high time for companies to rethink their current strategies to move forward. In this guide, let’s see how artificial intelligence (AI) is at the core of this transformation in building a more resilient and responsive aviation industry supply chain.
The industry is not what it used to be
Being resourceful where you can
The aviation industry handles capital-intensive assets. These items in turn consist of sub-components that need to satisfy dense compliance requirements for them to be approved. Not only does this make it challenging to switch suppliers whenever you see fit, but since these parts are always moving, it’s difficult to track them accurately as well.
According to a survey by SupplyChainDive, 94% of companies don’t have full visibility of their supply chain and logistics operations. This lack of visibility is what amplifies the existing vulnerabilities and inefficiencies in the aviation supply chain. Therefore, it’s essential for market leaders of the aviation industry to have full visibility over their inventory so that parts can be seamlessly moved within an organization when and if needed. This is especially true for parts that are infrequently used.
Another concern is a lack of raw materials like aluminum, nickel, magnesium, and titanium which are used to create supply alloys for aircraft. As a result, operation managers are scheduling maintenance only when needed as opposed to doing it at scheduled intervals. Run-to-failure maintenance only proves to be counterproductive since it leads to more unplanned production downtimes and reduces the lifespan of company assets.
Scheduling in advance
Production downtime can have far-reaching effects on airlines. It cannot impact not only their purchase of new aircraft, but also impact the maintenance of assets within their existing fleet.On the other hand, some companies also make the mistake of blindly overstocking inventory. Not only do they collect dust until they’re needed (if at all), but the capital tied to them could be invested into an area of business that yields a better ROI.
Using predictive tools can help you make smart decisions about what needs to be purchased ahead of time. Businesses need to adopt the right tools and technologies to facilitate this process.
Artificial intelligence can help mitigate risk in uncertain times
Increase inventory visibility
An AI-based system captures, stores, and processes both structured and unstructured supply chain data before centralizing it into a single location. This helps businesses attain end-to-end visibility, giving them a 360-degree view across all tiers of their supply network.
You can access information regarding what inventory is currently stocked, where it’s located, and how much is on hand. With constant access to a digital trail of moving parts in your supply chain, operations can identify vulnerabilities and resolve them almost instantaneously.
For instance, if you notice that capital is tied up in slow-moving inventory or idle stock, you can sell off those assets for reinvestment elsewhere. This helps businesses increase their agility and remain flexible enough to navigate through unforeseen circumstances with speed, specificity, and scale.
Prolong the lifespan of your assets
The current shortage of raw materials led to extensive lead time for parts that continue to create bottlenecks in production. This should be a cue for market leaders to take precautionary actions to curb the issue.
While operations teams incorporate comprehensive scheduling systems for asset maintenance, human efforts to manage the procurement and handling of critical MRO parts may not be as reliable as new technology. Leveraging the power of artificial intelligence can not only help create an efficient inventory plan, but it can also uncover hidden opportunities for optimization.
Powerful machine learning algorithms can be used to analyze mountains of historical data to find patterns a human eye may miss. Based on past downtime events, the algorithms can accurately predict the appropriate materials needed for different assets. This way, you can not only increase the lifespan of your assets but can also keep mechanical issues that require complex parts to a minimum.
It doesn’t just end there, these intelligence systems can also provide actionable insight via their predictive analysis capabilities. You’ll be able to gain a comprehensive breakdown regarding which replacement parts are needed, in what quantity, and when. It’s a simple and comprehensive way to avoid shipping delays and downtime.
Keep compliant procurement options on hand
To navigate a competitive, dynamic market, businesses should be responsive and proactive to external circumstances. For this to happen, there should be an AI-driven platform that facilitates the timely exchange of information between key stakeholders so that they can make swift decisions about events happening in real time.
Aviation operations need to ensure that their procurement strategies are compliant and contract-friendly. A cloud-based solution can house vital materials data that can be accessed from anywhere. Coupled with AI, companies can easily transition from traditional spreadsheet analysis to a more strategic approach.
The cloud-based system holds multiple procurement options. This gives purchasing agents access to qualitative supply chain information, reports, and KPIs so they can make informed spending decisions.
Keep your supply chain resilient in times of uncertainty
The aviation supply chain that we once knew no longer exists. Old, legacy systems are simply not equipped with the right tools to face the uncertain market that lies ahead.
It’s high time that businesses embrace digital transformation to adopt and harness the power of artificial intelligence in the aviation industry so they can stay ahead of the market.
AI has quickly transitioned from a luxury to a necessity. These intelligent systems can help you achieve end-to-end visibility, provide actionable insight, and automate processes. This combination can help you unlock new efficiencies, help you build a competitive advantage, and fuel profitable growth. Find out how these tools can work for you with Verusen.