What is Vector Shift?
Vector Shift is a timely insight series from Manufacturo, offering sharp, data-backed takes on the trends, risks, and opportunities shaping high-complexity manufacturing. From aerospace to automation, each edition breaks down what matters—so you can act with confidence.
The Challenges
A recent study released on the State of Aerospace Mergers & Acquisitions (M&A) by RSM highlighted a number of challenges for mid-market A&D companies when navigating buyouts, partnerships, or growth through consolidation:
- M&A are on the decline, yet demand is still on the rise;
- Fluctuation of M&A and market volatility has forced supply chains to become more resilient, and
- Less diversification may be on the horizon for suppliers, implying that your top performing and most profitable products will be at the forefront and far more products will be disbanded or outsourced.
Bottom line, it's back to basics with quality and operational efficiencies for manufacturers.
Recommendations to Mitigate Risk
RSM recommended that aerospace parts suppliers focus on solutions and strategies to mitigate risks, including strengthening supply chain resilience and enhancing operational efficiencies. Margins are still likely to get squeezed, and therefore a second look at operational challenges in tactical improvements should be addressed by senior leadership.
An area often overlooked for improving margins, is how your shop floor delivers information and executes tactical work on a day-to-day basis. When running the numbers week by week on your operations, the question is do they tell the whole story?
KPIs that looked good on paper may be hiding the key challenges that make a difference to your bottom line.
If you haven’t done an operational risk assessment or efficiency analysis lately, the time is now. Even something as simple as reducing redundant systems or streamlining manual processes can make a percentage difference in your cost and ultimately your margin. Yes, a percentage may seem minor, but when translated into dollars, the impact on your margins can be substantial.
But how do you deal with these unknowns on the shop floor?
It starts with back-to-basics research:
- 1. Inventory the systems your operations and quality teams use.
- 2. Run cycles on time it takes to implement a design change to the shop floor.
- 3. Follow the data chain from design release to shipment to the customer.
You’ll be surprised at the results.
On average, there are over 75 areas of redundant information. Information that must be entered into a system to tool more than once, oftentimes manually. That’s a waste. Pure and simple.
Lastly, you will want to:
- 4. Track the minutes and hours of ‘downtime,’ which is the time when your workers are waiting – not working. Not machine downtime, not line downtime, but human downtime.
This is where your margins are made... or broken. Uncover why this person is waiting and then calculate that against your average hourly rate. I promise you will be astonished.
Then, fix it. Implement new solutions that will fix this waste. Your bottom line will thank you.
