Airbus_Implementing RFID Technology
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The document discusses the implementation of RFID technology in Airbus's supply chain management to improve operational efficiency by enhancing visibility and accuracy. It reviews the strategic, process, and business benefits of RFID compared to traditional systems while also addressing the disadvantages and challenges involved. Ultimately, it suggests that despite current resistance, RFID is likely to become an integral part of supply chain management due to its superior advantages.
Airbus_Implementing RFID Technology
- 1. Supply Chain Management at Airbus - Implementing RFID Technology Operations and Supply Chain Management (OSCM) Project Date: 24/09/2011
- 2. Group 9 - Team Members •Brajesh Kumar •2012MLP019 Introduction •Anurag Kanoongo •2012MLP015 Supply Chain Process •Gurleen Kaur •2012HRLP027 Implementation of RFID •Natasha Mitra •2012HRLP008 Improved Operational Efficiency •Vinod Krishnan •2012HRLP013 Critical Analysis •Raman Girdhar •2012HRLP033 Critical Analysis
- 3. Project Structure • Project Learning Objectives: o Study the supply chain processes of Airbus. o Understand the implementation of RFID technology . o Analyze how RFID technology can improve the operational efficiency. • Critical Analysis: o Based on the study, examine the advantages, disadvantages and challenges of implementing RFID technology. o RFID is currently the buzzword in the world of supply chain management. But is it simply a fad or an unstoppable business improvement?
- 4. Supply Chain Processes of Airbus
- 5. 75%of the Aircraft Cost at Airbus is external Procurement • Several different communication modes • Different Part Numbers • Different supplier coding • Multiple transportation providers • Multiple tiers
- 6. Production sharing by the centers
- 7. Implementation of RFID Technology Supplier’s equip their supply goods for Airbus with RFID tags, which carry important information. Information is read at each relevant point in the supply chain. Information stored in tags include: Serial no’s, Manufacturer codes, Country of origin, Date of installation and maintenance, Inspection information etc.
- 8. Implementation of RFID Technology
- 9. How RFID technology can improve the operational efficiency • Increasing Value Chain Visibility o RFID enabled real time and automated visibility with an high level of accuracy. o Airbus introduced a 'maintenance, repair and overhaul' (MRO) strategy supporting RFID adoption for “VCV," by tracing both flyable and non-flyable components over their total lifecycle. o Increasingly competitive global market, and the need to reduce costs driven the firm to adopt RFID. o Airbus views RFID as an infrastructure that can be deployed across many areas of its business, each of which delivers value not just to the company, but also to its suppliers and customers. o RFID acts as their "business radar to let (them) see what's going on faster and in real time so (they) can make the right decisions faster."
- 10. Critical Analysis (1) Strategic Benefits • Real time visibility and automatic update of events across the value chain • Unprecedented high level of information accuracy • Opportunity to redefine and improve key supply chain processes
- 11. Critical Analysis (2) Process Benefits • More efficient automated processes -> shorter cycle times -> less inventory • Increased accuracy & control of business operations -> less non conformities • More automation -> Less manual intervention -> Improved labour productivity • Automated & realtime tracking of supplier -> Airbus / non Airbus flows
- 12. Critical Analysis (3) Business Benefits • Increased Labour Productivity • Reduction in Inventory • Improved supplier monitoring and flexible payment solutions • Improved supplier forecasting -> Improved supplier delivery performance
- 13. Critical Analysis (4) • Disadvantages o High costs, as compared to bar codes o Lack of standardization o Potential Data Interference o Potential Overload Issues o Interference with reading tags from environmental factors like metal and water • Challenges o Cost Reduction o Resistance to Change from Barcode System o Standardization o No data interference o Managing the over load o Non dependency on Environmental factors
- 14. Is it simply a fad or an unstoppable business improvement? • The success achieved by Airbus seems to imply the latter. • RFID undoubtedly has the potential to provide numerous benefits that are superior to barcoding. • Despite the current resistance to acceptance of RFID, difficulties will be overcome as the costs decrease, usage extends, and benefits documented.