Innovation Engineering for Growth

Company Profile

Global Parts Aero is based in Augusta, Kansas just on the outskirts of Wichita.  At the time of the start of the project, Global Parts Aero was a 10 year old company with approximately 50 employees. The company started out of the CEO's basement buying and selling aircraft parts and components to repair stations around the country. They had many issues or struggles that they were facing at the time of project kickoff.  Some of those included multiple new divisions that were floundering in generating revenue, company CEO that didn't have enough time (or didn't delegate well), one very large supplier of components, a relatively new warehousing facility, a very large inventory of parts some of which they can't adequately track, and many others. The company has grown during those 10 years, and is a local success story, but there remained a need to reinvent itself, its capabilities and to diversify from the one large supplier of their parts.

Situation

MAMTC began a yearlong project with Global Parts Aero in the spring of 2013. The project was an Innovation Engineering based project, with the ultimate goal of getting 2 internal IE Black Belts, a pipeline of innovative ideas and projects, and a strategy for growing the company. According to Malissa Nesmith, company COO, "We are an opportunistic company, not a strategic company. We need to change that."

The Innovation Engineering project was kicked off with a team of approximately 12 people who generated many great ideas, projects and initiatives. Some were deemed as "Just Do Its" and were implemented almost immediately with success. Other projects continued on the more traditional PDSA/Deming Cycle of learning. One of the main projects that the team worked on related to the company's desire to be less dependent on their near sole source supplier, and to build or acquire the ability to produce components and parts themselves in their new manufacturing facility. In many industry sectors it is easy to reverse engineer a part and start to sell them. But in the aviation world there are a number of certification processes and steps that must be taken in order to prove to the FAA that the parts that you are producing are viable and reliable. After all, you don't want to have a problem in an aircraft while it's in the air, so testing and certifications are an important part of the process in this sector.

Solution

Eventually, after many cycles of learning, the team was able to provide sufficient detail to management that the acquisition of a Hydraulic Test Stand would be a cost effective step, one that will allow them to start producing some of the parts in house instead of purchasing them. All good deeds don't go unpunished however. The original acquisition date of the Hydraulic Test Stand was to be January of 2014.  It has not been delivered as of the end of August.  All good deeds don't go unrewarded either.  Based on the methodology and process used in the Hydraulic Test Stand analysis, they have purchased a Pneumatic Test Stand that allows them to build and develop other types of products and equipment.  According to Global Parts Aero's Business Development Manager Brad Vieux, "This part (pointing to a small part on the pneumatic test stand) can be built for $4 in materials whereas before we were purchasing them for $26.  That's a lot better margin for us." 

And this is just one part on one fabrication line. The company still anticipates great results whenever the Hydraulic Test Stand is installed, and they have recently acquired an Electronics Test Stand as well.  Several of their divisions have started generating revenues as well, so it's an exciting time at Global Parts Aero.

In recent months they have acquired additional capabilities and certifications by buying several repair stations and other operations. They have grown in employees by 100%, now well over 100 people.  Their sales have grown as a result of their additional capabilities and certifications, but the margins are still lagging. "We've got to get a grasp of what all we have acquired in this short time and eliminate the redundancies," stated Brad Vieux. "But without the injection of Innovation Engineering into our mindset and our culture we never would have thought about some of these opportunities that have presented themselves to us. We're a more aggressive, forward thinking company than before."

As a final item, it should be noted that neither of the two internal IE Black Belt candidates finished their required assignments and projects within the 12 month window as defined by Innovation Engineering Network. In discussing this 'failure' with the two individuals, they mentioned that they were so busy with the growth side that they didn't have time to work on their Black Belt requirements. "But give us a few months and we'd like to start the journey over again from step 1." Global Parts Aero understands the IE process, the need for leadership participation and what it can do, and has done, for them.

Results

After working with MAMTC on IE, Global Parts Aero saw $12,000,000 in increased sales, created 5 new jobs, and saved $500,000 in costs.

Testimonial

"We've got to get a grasp of what all we have acquired in this short time and eliminate the redundancies.  But without the injection of Innovation Engineering into our mindset and our culture we never would have thought about some of these opportunities that have presented themselves to us. We're a more aggressive, forward thinking company than before." - Brad Vieux, Business Development Manager