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An RFID Roadmap for Small and Midsize Contract Manufacturers

Killdeer Mountain Manufacturing, which makes aerospace components, deployed a work-in-process application to track orders for Boeing.
By Jill Gambon
Jan 18, 2010—For years, Boeing, Northrop Grumman and other leading aerospace firms have been implementing lean-manufacturing practices to trim costs, boost efficiencies and improve inventory management. But many of the small and medium-size contract manufacturers that supply the thousands of components used to build commercial and military aircraft have lagged behind. These firms, often lacking the resources and infrastructure required to launch lean initiatives, rely instead on old-school, paper-based systems for manually managing inventory, processing orders and tracking products on the manufacturing floor.

Killdeer Mountain Manufacturing (KMM), a family-owned, 330-employee manufacturer of circuit cards, cable harnesses and other aerospace components, set out to change that. Over the past four years, the company, based in Killdeer, N.D., has overhauled its production processes and introduced a radio frequency identification system to track work in process (WIP) for its cable harness product line, which Boeing uses in the assembly of its F-15 fighter jets. The $4 million project was funded by the U.S. Air Force and developed by KMM, Boeing, the Air Force Manufacturing Technology Division, Alien Technology, Microsoft, RFID Global Solution and others.

The SCOUT program offers a clear view of KMM's inventory and manufacturing processes.

The key goal of the project—dubbed the RFID Supply Chain Optimization Universal Toolkit (SCOUT) program—was to create a clear view of KMM's inventory and manufacturing processes. "We needed supply-chain transparency in order to be hand in glove with our customers," says Kristin Hedger, the company's VP (her grandfather founded KMM in 1987). Providing up-to-the-minute information regarding the status of its products would help Boeing—one of KMM's main customers—better plan its production schedules, she explains.

"The aerospace supply chain is complex, with interdependence among suppliers," says Joe White, COO of RFID Global Solution, the systems integrator that worked with KMM on the last leg of the project, and also supplied the WIP tracking software. Like a traffic accident on a main artery, late delivery of a component can cause delays up and down the supply chain, throwing off schedules and creating costly backlogs. In addition to improving customer relations, KMM realized it could also bring efficiency to its own operations if it had real-time information about the status and whereabouts of its products. Such insight would enable the company to quickly pinpoint bottlenecks or production variations, and then address these issues before they snowballed.

The project, launched in 2006, was carried out in three phases: First, KMM overhauled its manufacturing processes and introduced lean and Six Sigma practices to wring out inefficiencies. The next step involved RFID system design, as well as the initial stages of integrating RFID data with KMM's material resource planning (MRP) platform (Microsoft's Dynamics GP 10). The final phase involved refining the design—particularly the data integration—and then, in August 2009, ultimately flipping the switch on the WIP application, known as Visi-Trac, in the wire harness production line.

The results brought about a dramatic transformation in KMM's operations, the company reports—shaving costs and streamlining manufacturing—while also enabling Boeing to track its orders in real time. KMM plans to expand its use of Visi-Trac, and the SCOUT program will be made available to other small and medium-size aerospace contract manufacturers.
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