Best Practices in Lean Six Sigma Process Improvement: A Deeper Look

Chapter 21. Aerospace-Defense: OEMS Are Soaring; Suppliers Are Not

Aerospace-defense (A-D) ranks below average on long-term leanness: 17th out of 33 industries (Chapter 18). Closer study shows, however, that the giants of the industry—12 end-product producers of aircraft, missiles, ships, tanks, and the like—are mostly doing well on the inventory-turnover scale. The rest, 40 components suppliers that make up our 53-company A-D database, include some stellar performers. Many more weak ones drag down the A-D sector's overall ranking. If treated as two separate industries the OEMs would rank in the top 8 of 33 industries, and the suppliers in the bottom 7.

This is opposite to automotive, where the component suppliers' 12th rank is far better than that of makers of light-vehicles (29th) and heavy-vehicles (31st). Reasons why A-D and motor vehicles are opposite in this respect is a topic for later discussion.

In probing the industry, this chapter examines three kinds of data: One is the inventory-turnover trends for the 53 A-D companies. The second is the World Class by Principles Benchmarking database, which ranks the A-D industry not low, but third best of 26 industries. The third is published reports on lean successes at various A-D plants. Aerospace-defense, though, is a complex industry full of confusing claims and counterclaims. Later in the chapter, we demonstrate that typical performance metrics from individual A-D plants and programs—flow times, cost reductions, yield improvements, ...