Aeronautics companies are fundamentally risk adverse – for very good reasons – and this reflects in the management of the companies’ activity in every area. However, this mentality can be a hindrance when it comes to supply chain, as avoiding risk and not integrating the very concept of risk at the heart of the supply chain means losing sight of what you are optimizing.

Pitfalls of supply chain for aeronautics, 10 ways to avoid them

Risk, as a manifestation of the uncertainties in the process, is an integral part of supply chains. It can be reduced to some extent, but never erased. A common practice in supply chain is to try and handle the issue through an oversimplification of reality. To focus the company’s efforts on artificial concepts like safety stock, or to enforce artificial segmentations like high value/rotation vs. low value/rotation parts are typical examples of ill-suited widespread practices; they are quite straightforward to put in place and they do allow the teams to remain in a comfort zone of sorts, but they end up crippling significantly the optimization capacity. Even forecast accuracy, in the traditional sense of the term, which is often depicted as the ultimate ingredient of an efficient supply chain, tends to act as a smoke screen and prevents focus on what really matters.

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