Today, contract electronics manufacturers (CEMs) working in the aerospace and defence sector are relied upon to guarantee the highest standards of supply chain excellence. Be it UK government directives to increase the SME involvement in defence procurement, the necessity for UK CEMs to carve out a world-leading reputation for security and traceability in domestic supply chains, or a new emphasis on changing accreditations and standards, it’s been a change-filled few years. In this article, David Davies, managing director of Axiom Manufacturing Services, explains how his company has been able to establish a USP for itself in an increasingly competitive aerospace and defence landscape, as well as discussing what future trends are likely to develop for CEMs involved in the sectors’ supply chains
It is an exciting time to be a UK-based OEM or CEM offering products and services within the aerospace and defence sector. Between the government’s commitment to meeting NATO’s two per cent defence spending target, the increased global desirability of solely UK-based supply chains, and the MOD’s target that 25 per cent of its £19 billion procurement budget will go through SMEs by 2020, there are now more opportunities than ever for manufacturers to capitalise on aerospace and defence – even if those sectors are not traditionally integral to their business models.
The UK’s decision to leave the EU has the potential to throw some unpredictability into the mix, but during the two years after Article 50 is invoked, we will still be governed by the EU procurement directives. Depending on how bilateral trading negotiations undertaken, there may even be increased opportunities to collaborate with manufacturers in the likes of Canada, India, the USA and Australia.
UK CEMs have good reason to be confident on the international stage. They have an established reputation as global leaders in terms of the security, testing, traceability and efficiency of their supply chains and manufacturing processes. Agility and quality have become our USPs.
British commitment to quality is perhaps nowhere better encapsulated than in accreditation. For UK CEMs who are serious about maintaining and developing a competitive edge, general standards such as ISO 9001, ISO 14001 and AS 9100 are imperative, but to really stand out, it is gold standard, sector-specific accreditations such as Nadcap AC7120 that are needed.
At Axiom, we gained Nadcap certification last year after a six-month application and audit process. Those kinds of timeframes can often intimidate smaller organisation, but accreditations like Nadcap illustrate the commitment to efficiency and excellence that is expected from UK CEMs who want to stand out in an ever more competitive marketplace.
That said, simply gaining accreditations cannot be a successful business strategy. They should come as a by-product of a long-term commitment to quality in your supply chains and testing. They should also be industry and customer driven. With Nadcap for instance, we identified that the aerospace sector was placing evermore scrutiny on quality control; as a result, Nadcap would likely become an increasingly essential accreditation in the future. After weighing up whether the best practices from the accreditation could help our commitment to quality, we sat down with our customer base and explained why pursuing the accreditation and implementing the processes would help us improve our offering to them in the long-term. As a result, they agreed to sponsor some of the activities involved in pursuing Nadcap AC7120.
When designing bespoke testing solutions for aerospace and defence, CEMs need to maximise quality and added value by being involved as early as possible in the manufacturing process. Gone are the days when effective CEMs were simply responsibility for assembling OEM’s products and applying standardised test procedures. Today, the best will advise on product design, procurement strategy, and analyse future innovations and technologies that will affect the product all before the first PCB board even approaches an SMT line.
And nowhere is rigorous testing more important than in defence and aerospace. Not only are these products potentially being used in life and death situations, but they also need to function perfectly across the most extreme environments on our planet. While products destined for other sectors such as healthcare applications require equally high levels of testing, products intended for the aerospace and defence sector are unique in the range of environments they will be required, and trusted upon, to operate.
Accordingly, CEMs have to be able to simulate these conditions utilising in house state of the art ESS Labs (Environmental Stress Screening). ESS is the process of stress screening in which imposed vibration, thermal and electrical stresses are applied for sufficient periods of time to precipitate those parts with either design defects and or early life failure (ELF) characteristics. The screening can show problems that may exist in a design, before the item goes into produced. Testing at design stage is carried out with stresses exceeding those of in-service operating envelope, whilst production testing is normally done within this envelope. This process does not necessarily improve reliability, rather it provides feedback that CEMs and their customers to make necessary design improvements.
Traditionally, prototype designers and OEM developers have been reluctant to having third parties scrutinise their design. Yet, making sure CEM partners are involved as early as possible in the process is vital to delivering of the highest quality and most rigorous testing possible. Ultimately, allowing CEM partners to contribute their full supply chain expertise and testing capabilities is the best way attain the highest amount of added value – and therefore ROI – for the OEM.
That added value is perhaps nowhere better exemplified than by a robust in-house procurement division. By having a dedicated team who can not only sit down with OEMs to maximise traceability and efficiency in the supply chain, but can also advise on new advancements with the parts involved, a CEM can greatly expand the lifespan of the technology. In terms of life-saving products in defence or aerospace, future-proofing represents perhaps the most important added value a CEM can provide. More robust procurement strategies and teams also naturally correlate to greater levels of traceability. As it is in other sectors, such as medical and healthcare, it is absolutely imperative that if defence equipment fails, the faulty component(s) can be traced back to its source. However, in many cases the necessity to ensure supply chain security for the defence sector, will often require CEMs to carry the added burden of care to ensure that all components and materials are sourced, and can be traced, to UK suppliers.
When more than 85 per cent of manufacturing costs are fixed within the first 10 per cent of a product’s development, OEM and CEM partnerships at the initial stages allow the creation of truly lean and agile supply chains, unrivalled value for OEMs and a significant advantage for CEMs in the UK. In short, involvement at the initial design stage allows CEMs to better optimise and guarantee robust supply chains. Streamlining the flow of information provides added-value by reducing the risk of production errors, decreasing production costs and drastically cutting the design to market lead times.
If UK CEMs implement these approaches to defence and aerospace, they can truly stand out in the global marketplace. It’s an exciting time to be involved in the British defence and aerospace market in any capacity, yet if you can establish truly agile supply chains and prove your added value, it is the world, and not just the UK, that will be your stage in this sector.