Part grouping: angioplasty for the supply chain: a part grouping system, however, effectively leverages a supply chain by arranging the production of individual items into groups that are based on common manufacturing processes - Agile Combat Support

Air Force Journal of Logistics, Spring, 2003 by Michael C. Yusi

Hey, loggie warfighter, your aged weapon systems are full of tired iron, you have diminishing manufacturing sources for mission critical spare parts, your industrial base is getting colder, and lead times are getting longer each day. Logistically, you have hardening of the arteries: no agility, no flexibility, and no options right? Well, there is angioplasty for your supply chain. This article analyzes how a supply chain part grouping system mitigates these types of problems and reopens supply chain blood flow for improved health. It defines this system, describes how this process begins, explains how rigor is put back into a cool industrial base, demonstrates how it smooths variations in demands and decreases production lead times, and shows how it improves availability and lowers costs of critical parts for end users. Examples from the Defense Logistics Agency (DLA) are used to elaborate some points even further. Finally, results of a part grouping concept demonstration between the Boeing Company and DLA are highlighted and reviewed.

Part Grouping Definition

A part grouping system relates to the idea of group technology (GT) but has a slightly different approach. Thomas E. Potok, Collaborative Technologies Research Center, Oak Ridge National Laboratory, states manufacturers view group technology "batching parts to take advantage of economies of scale," which usually will "be produced on a single manufacturing floor." (1) A part grouping system, however, effectively leverages a supply chain by "arranging the production of individual items into groups that are based on common manufacturing processes," (2) as well as similar part materials or vendor capabilities. In addition, it is not fixed to just one manufacturing line or vendor.

Instead, it takes advantage of using different vendors with processes and capabilities that can be applied to producing a group of parts. In a macroillustration, a part grouping system considers things like processing methods, steps, lines, and production capacities needed to make a group of parts. It considers similarity of part materials (metal, rubber, and carbonfiber) and if the parts are in some type of general family such as machined, structural, or sheet metal. Continuing even further, if it is machined or has structural parts using similar types of materials, it considers things such as general form, shape, gauge thickness, and number of welding points these parts have. It considers the cost to make these parts per unit of measure, such as a range between $x.xx [right arrow] $x.xx per foot. The point here is the variety of grouping options based on common manufacturing processes includes a wide number of factors. Expressed this way, a supplier who manages a variety of parts for many customers and missions achieves supply chain leverage using a part grouping system by partnering with a broad number of manufacturers possessing a range of capabilities with links to common manufacturing processes. This ensures greater depth and breadth of parts for the supplier when needed. This is in lieu of a supplier's depending (or being victim) on a few vendors or a single vendor with fixed capability making only one part. Another real possibility for a supplier is having no vendor available at all. This kind of scenario adversely impacts the mission capability of a customer's weapon system needing a zero-balance 35-five cent widget, grounding a fleet of F-16 jets or M1A1 Abrams tanks. With this in mind, improved supply chain agility, flexibility, and vigor (blood flow) using a part grouping system are possible.

Beginning the Supply Chain Angioplasty Process

Starting a part grouping system is the tough part; it is like intrusive surgery. It involves a supplier's collecting, organizing, and sharing large amounts of information on parts it manages and customers it supports to team with interested manufacturer and vendor groups. An interested manufacturer, in turn, must take the supplier data and assess its production base to link common manufacturing processes to part characteristics to determine what supply chain improvements it can offer in a part grouping system. This is much easier said than done; however, it is needed to pave a way through the supply chain arterial system for the supplier to get the high-ratio manufacturer partnerships to achieve part grouping system payoffs. For example, the DLA (as a supplier) provides Class IX spare parts for all military services. This includes managing more than 2.6 million national stock numbers (NSN) coded to more than 1,368 aerospace, land, and maritime weapon systems for the Air Force, Navy, Army, and Marine Corps. (3) This sheer number of NSNs, along with the range of warfighter customers and weapon systems supported, as well as the large number of manufacturers currently working with the DLA, makes starting a task daunting. This startup difficulty, however, can be mitigated for supplier and manufacturer. How? Well, they can decide to narrow the initial part grouping target based on a specific range of weapon systems or end items such as tracked armored vehicles, jet aircraft, instruments, or electrical systems. By doing so, focused leverage can be placed on certain weapon systems, which not only gets the process started but also can include the interests expressed by supply chain customers.