Mass Production 1, Lean 0

Boeing's ballyhooed (in some quarters) lean production of the 787 Dreamliner just ran into the ugly reality of mass production in its supply chain.  A serious shortage of titanium fasteners threatens to delay the July 8 unveiling of the plane.  The Wall Street Journal notes,

Boeing is working closely with its primary fastener supplier, Alcoa Inc., to get enough high-quality titanium bolts to put the plane together in a logical fashion.  Nevertheless, major components, such as the wings, arrived from Japan and other locations such as Italy and South Carolina held together by thousands of temporary fasteners.

This blog briefly commented on the problem yesterday.  Alcoa has been slow to add production capacity for fear of being stuck with it during the next industry downturn.  And the Seattle Post-Intelligencer reports that Boeing contributed to the problem by setting requirements for the fasteners near the end of the engineering design process. As a result, fastener makers like Alcoa got a late start in tooling up.

For sure, these are significant issues that have contributed to the shortage.  But the WSJ article indirectly sheds light what might be the root cause of the problem: the clash between a mass production supplier and a lean production process. 

Alcoa (at least when it comes to the manufacture of these fasteners) is firmly entrenched in mass production mode:

Each bolt must be individually made on a lathe -- a process that can't be hurried.  Because it takes time to set up the lathe, Alcoa would prefer to make thousands of one type of fastener before breaking the machine down and resetting it.

So, no SMED for Alcoa.  Set up the machines, let 'em run, and build up inventory to reduce the average cost of the  parts.  But that doesn't help Boeing right now.  As Mike Bair, the Boeing VP of in charge of the Dreamliner, says,

"Problem is, we don't need thousands of bolts right now.  We might need 10 of one kind."

Presumably, Boeing and Alcoa will find some way of getting those fasteners in time for the July 8 deadline.  Boeing will have a shiny new Dreamliner to show off to the media, and a great story to tell about their new lean production system. 

But they won't talk about the conflict between mass production and lean production.  They won't talk about the difficulty of getting a small quantity of parts from a supplier that's committed to batch and queue manufacturing.  And you can bet they won't talk about the larger ramifications of this issue. 

How lean can you really be when your suppliers are in batch mode?

Comments

[Mark Graban]

Dan, that's great digging that you did to uncover that. Instead of blaming suppliers (Alcoa can't deliver) or blaming innovation (we have new technology), Boeing (and the media) need to focus on supply chain processes and product development processes.

Where is the vaunted "Alcoa Production System"????????????

[Ken Tolbert]

Interesting observation. But shouldn't this conflict be ironed out during the supplier qualification and planning stages of a project? Granted the sales of the 787 have been stronger than expected, but that is long-term. There was more than enough awareness of near-term schedules and demand many months, if not years, ago.

[Un Disclosed]

Both of the main problems are common through the entire 787 supply chain. Boeing has been nice enough to share the risks down the the suppliers (the risk of getting stuck with capacity). Boeing has also be extremely late on the engineering. After being given a start that was 2 months late we were asked "What is your recovery plan?". Boeing has a great product in the 787. But if they aren't careful, they will drive another group of suppliers our of business.

[Undisclosed]

Surely it's in Boeing's best interest to develop their current suppliers in order to achieve the delivery requirements of the 787 aswell as avoid this costly mis-match in the future.

A Lean system is just that, a system. If all components of the system (this MUST include major suppliers) are not all working it will always fall down like this. If Boeing are commited to Lean and are expecting cost and delivery improvements from it's development, they need to be doing so in a 'partnership' fashion with their suppliers (and customers)...