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Boeing: My Kingdom for a Fastener

September 19th, 2007 · by Tim Minahan · 4 Comments · supply management, supply risk

If your CEO or CFO still don’t understand the impact supply management can have on the top line, point them to Boeing’s latest troubles with bringing its fabled 787 Dreamliner to market. Various reports this week revealed that Boeing is four to eight months behind schedule in delivering what is touted as the world’s largest (and most efficient) jet airliner. And market watchers predict that any significant delay could stall Boeing’s revival, damaging both its credibility in the marketplace and putting it as risk of financial penalties or, in extreme cases, canceled orders.

The chief culprit for the delay? Supply shortages. More specifically, the multi-billion-dollar Dreamliner program is being held up by a shortage of aerospace fasteners.
The news of supply shortages is surprising considering the foresight Boeing put into shoring up ample supply of the strong and lightweight composite materials that enable the Dreamliner’s hallmark size and fuel efficiency. In fact, previous posts praised Boeing for adopting innovative supply strategies — including entering into a joint venture with Russian-based VSMPO — that locked up nearly one-third of the world’s titanium.

Boeing officials this week stated that the 787 Dreamliner could still make its May delivery date, barring any further delays. But suppliers quoted in the Wall Street Journal say on-time delivery will be nothing short of a miracle.

Even worse, new reports are surfacing that the fastener shortage may be more widespread than originally believed.”Boeing has confirmed the issue with temporary fasteners that helped to delay the 787’s first flight date…is not limited to thousands of individual fasteners, but actually thousands od types of fasteners,” reported aviation industry watcher Flight International.

Boeing’s challenges are a reminder that risk management is a continuous process. Effectively detecting and managing risks requires the monitoring not only your key suppliers, but also of the key material inputs into the products they produce. Let’s hope Boeing’s resolution of the fastener shortage provides valuable lessons in how to recover from a supply crisis.

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4 responses so far ↓

  • 1 OldEngineer // Oct 11, 2007 at 6:26 pm

    The 787 has a new type of seat track that the passenger seats attach to, totally different than the industry standard that has been in place for over 50 years. There are only two companies that make fasteners that *might* work with these new tracks. And I’ve heard that the fitting that has been the primary design doesn’t work that well.

  • 2 Tim Minahan // Oct 12, 2007 at 9:17 am

    Thank you for the additional information. Boeing is also struggling to secure rare fasteners (and the composite metals that they’re made of) to hold the fuselage together.

    Yet, Boeing’s troubles reaffirm why many manufacturers are reengineering their product designs to ensure the use of standard parts and materials — as well as commodity parts, when possible — across multiple products and platforms. Such specification standardization lowers costs and can also ensure ample supply.

  • 3 Joe // Nov 19, 2007 at 5:25 pm

    What companies would provide fasteners for the new seat track? Is there any additional information on that new seat track?

  • 4 Mark J. Hahn // Feb 1, 2008 at 4:53 pm

    Hi Joe,

    Our company would be happy to look at the seat track fasteners.

    I’ve worked in aerospace distribution for over 15 years before becoming a partner in a fastener manufacturer.

    It still amazes me that large OEM have such a small and limited supply base of fastener companies. What is even worse is they are usually the same for each OEM.

    Think outside of the box. Quality and delivery does not mean you have to be on the stock exchange.

    Regards,

    Mark J. Hahn

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