Given strong growth in both commercial aircraft demand and defense spending, the aerospace industry faces a persistent challenge to keep supply chain operations at peak efficiency. Thirty-eight thousand aircraft are expected to be produced over the next 20 years, and the largest aerospace OEMs have a backlog of orders to fill the next 10 years. That means significant pressure to deliver on time and intelligently innovate and roll out upgraded aircraft models while passing regulatory muster.
Aerospace companies around the world use Skuchain’s EC3 Platform to:
Secure critical components with program buying. From iron to fasteners, several components are critical for aircraft manufacture and have the ability to significantly delay or even shut down an assembly line if not available at the right time and in the necessary quantities. By the time such a shortage is discovered, production plans have to be adjusted by weeks, or even years, and the supply chain has to throw enormous resources towards procuring the necessary components to avoid an order cancellation worth millions.
Collaboratively plan with their supply chains. While Just In Time (JIT) procurement is the gold standard for aerospace supply chains, it is becoming harder and harder to achieve with rapidly changing aerospace technologies and customer preferences. The problem for aerospace manufacturers is that lack of visibility in the production process exacerbates uncertainty in delivery plans set years in advance. For Maintenance and Repair Operations (MRO), which are much shorter-term contracts, aerospace supply chains have to coordinate complex procurement, processing and regulatory approval requirements so a part can become airworthy on schedule.
The key to minimizing risk of procurement errors, late delivery or delivery of faulty parts, is to plan in a collaborative manner by sharing critical information across the supply chain. Any blockchain platform will allow for this data to be distributed in a decentralized way across supply chain partners. Not all data can be shared, however, and some data may be used in an algorithm but cannot be revealed in its raw form. That’s where EC3 comes in to make collaborative planning a practical reality.Using our smart contracts system and cutting-edge zero-knowledge technology, EC3 is able to
When an aerospace OEM knows that its sensitive information can be used by supply chain partners to plan without compromising confidentiality, they are finally able to share this information and enable a much more efficiently planned supply chain.
Finance suppliers all the way upstream with the lowest rate in the supply chain. Given significant working capital necessary for aerospace manufacturing, new financing opportunities for buyers and suppliers can offer a critical path to expanding capacity and COGS savings. Traditional invoice factoring or receivables financing is a post shipment invoice-accepted model.
In this model:
Our BOM Buyer is a completely different way of freeing up capital in the supply chain that turns inventory into financeable assets. A special purpose vehicle governed by a smart contract takes ‘title’ to the underlying good.
There are three main benefits to the BOM Buyer:
What does a typical BOM Buyer deal look like?
What does blockchain bring to this deal?
Automate the MRO process by sharing documentation across multiple supply chain partners and even regulators. Each step of an MRO workflow requires close tracking of the origin and quality of materials, process applied, personnel and organizations involved, reconciliation of aircraft configuration and regulatory paperwork. In addition, since MRO contracts tend to require a faster turnaround, each of these complex pieces has to be effectively coordinated so that a part can become airworthy on schedule.
By tagging each of the spare parts used with notations about the process and corresponding documentation on a distributed ledger, an aerospace OEM and its suppliers can automate MRO tracking, planning and regulatory compliance. Because Skuchain’s EC3 integrates its Popcodes traceability technology with Brackets smart contracts, we are able to tie transactions and paperwork with a specific part across the supply chain. Popcodes may be logged onto the blockchain through the Skuchain smartphone app or legacy industrial scanners. Transactions and records may be submitted to EC3 through an API integration with ERP systems, Excel spreadsheets or other existing technology, or directly into our CRP.
As a result, OEMs, suppliers and regulatory authorities alike can complete the MRO process in the most efficient and cost-effective way possible. Should the need arise to review records of an MRO process in the future, OEMs and regulators can use the end-to-end traceability on the blockchain to track the issue back to its source in seconds.