The strategic process related to supplier selection in the aircraft industry
- A background to the aircraft industry
- A summary analysis of current supplier selection methods and objectives in the aircraft industry
- Primary research conducted at Airbus
- Critic and comparison between primary research results and initial theoretical findings
- Conclusions and limitations of study
Nowadays, more firms choose to outsource activities and products which are considered outside of the company’s core business. This enables them to concentrate exclusively on their main activity and become more efficient at it. Therefore, the selection and evaluation process of vendors likely to supply these outsourced products is one of the most important decisions for a firm. Usually it relies of price, supplier expertise reliability and ability to meet requirements and timed delivery schedule.
During my internship last year I was in the buyers department at Airbus and was able to observe and intervene during the selection of suppliers for certain parts of the Aircraft. This selection process went through several steps, each of them having different objectives and questionings. This gave me the idea of continuing to analyse supplier selection but in a more detailed and critical way.
My objective in this paper is to use this ground knowledge to further examine strategic supplier selection. I will be able to use it when conducting the initial literature review to choose documents that I know will be more relevant to my research. By doing this, my personal primary research can be conducted in a better, more organised manner and the findings in my report will be more conclusive.
[...] Climb to Greatness: The American Aircraft Industry, 1920- 1960. Cambridge: MIT Press, 1968. - Stekler, Herman O. The Structure and Performance of the Aerospace Industry. Berkeley: University of California Press, 1965. Interviews - Interview with HEUERMANN Michael, Buyer at Airbus, at Hamburg on the 20/02/2012 - Telephone interview with MARC Olivier, Customization Director, at Toulouse on the 01/03/2012 - Questionaire filled in by BREDMEIR Kai, Aircraft Systems Engineering. - Questionaire filled in by GROH Tilman, Quality Conformance Manager. - Questionaire filled in by PEIRON Benjamin, Sales Contracts. [...]
[...] The weighting is then applied to the rating each supplier receives in the fields affected by the matrix. Because of variations in market supply, demand, product life cycles, suppliers and company’s strategies, the set of weights can evolve over time and should be dynamic. Fuel efficiency for example might not have been as much of a problem two decades ago but many industrial firms now make sure that this is emphasized during supplier selection and even more so for years to come. [...]
[...] The later steps in the selection process are then more direct. Airbus sends out a Request for Proposal (RFP) letter to the suppliers that have been selected in order to receive their more detailed offers. The suppliers receive a detailed time frame during which they can submit their offers on the Airbus platform and can organise workshops with Airbus Engineering in order to have more detailed information on what their needs are. After the time frame is over, the Procurement department prepares a comprehensive selection report which includes a technical evaluation, commercial evaluation, product support evaluation, industrial and risk evaluation before making a recommendation for the selection of one of them. [...]
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