A planning application aggregates data from the disparate sources related to those parts and suggests the most effective way to meet the parts demand. “We have criteria to figure out how to best move the inventory within your network and then make a recommendation,” says Wodarski. Once a planner accepts that recommendation, the system sends the information to the appropriate warehouse and transportation management systems that will fill the orders.
Systems of record such as ERP, inventory optimization and parts planning are known as supply chain management systems. They help organizations decide how much inventory to carry and what modes of transportation to use to ship products. Then they create a plan.
Supply chain execution systems act on those plans. They make things happen in the supply chain. Warehouse management systems (WMS) and transportation management systems (TMS) keep track of the amount and location of inventory in storage (stock-picking activities when parts are pulled to fill an order or for a maintenance event), create replenishment orders when stock falls below minimum levels and manage transportation activities.
In industries such as retail, wholesale grocery and beverage, it is common to use a best-of-breed, or standalone, WMS or TMS system. Due to commercial aviation industry compliance requirements, warehousing and transportation software systems are more commonly integrated components of a broader MRO software package. “In most supply chains, you buy a part, you get it shipped where it's needed, and you're done,” says Chris Reed, managing director of Trax, an MRO software provider. “In our industry, you have rotables that are moving back and forth between locations. You have parts that require special containers, special transportation and even specialist companies to move the parts.”
In addition, conventional WMS and TMS systems are not designed to manage the compliance requirements associated with a repair, monitor inventory levels to minimize obsolete stock and understand how many repairable parts could become serviceable and go back onto the shelves. Those benefits are the result of integrating supply chain execution into MRO programs. “When logistics applications are integrated into an MRO application, you know what parts are needed to perform the task, the configuration of those parts and when they're needed,” says Mxi's Elliott. “You also have visibility into the parts you have in stock. That allows you to avoid ordering parts that you already have or ordering non-compliant parts.”
When a maintenance plan is generated, it builds a bill of materials that will be required for that event. When the bill is sent to the warehouse management application, the WMS reserves parts that are in stock for that event, automates the steps to pick, kit, pack and deliver them on time to a technician, and automatically creates a requisition of parts that must be purchased.
The systems also can automate the replenishment of regularly used parts. “If you understand your demand and monitor your stock levels, you can manage the replenishment so you don't have to expedite a shipment,” says Elliott. “That reduces your transportation costs.”
The goal of all these systems—starting with the solution that B&H Worldwide is providing PDQ Air Spares—is to make supply chain activities more transparent. If you know what is happening in your supply chain, and where the bottlenecks occur, you can take proactive steps to reduce logistics costs, says Russell Smith, COO of B&H Worldwide.
“We can track a delivery from Point A to Point B,” says Smith. “But we also capture the milestones that happen within that journey, such as when a part is packed for shipment, when the shipping documents are complete, when it's put on an airplane, when it gets through customs and when it gets delivered to a repairer.”
With that type of information, an airline or MRO organization can capture data such as the average time it takes to ship a part from Miami to Sydney. “If you have an aircraft sitting on the deck in Sydney and know that it takes 38 hours to get a part from Miami on a routine basis, you can make decisions about whether to expedite that part or not,” says Smith. Similarly, by analyzing what happens to a shipment through the various milestones of a delivery, a shipper can determine where the supply chain is slowing up.