For many years, the question of who manages the maintenance of complex products like airplanes, ships, mining equipment, power plants, and oil refineries has vacillated between manufacturers and the owner-operators. Owning and controlling the service, maintenance, and upgrades for this complex equipment is big business that can last 20 to 40+ years, depending on the product. At stake are millions of dollars of annual maintenance — either revenue to be gained by manufacturers servicing what they build or expenses to be re-captured by owner-operators by gaining information needed to maintain their assets themselves.
What may have been minor skirmishes now have the potential to erupt into full-blown war as information across the product lifecycle becomes readily accessible to both manufacturers and owner-operators through the development of the Digital Thread. (In fairness, there is a lot of nuance to that statement, but more on that later.) Bottom line: extending engineering and manufacturing data out to the field and into maintenance, repair and overhaul (MRO), or vice versa, has the potential to completely change the game and arm each side with the information they need to handle complex maintenance on their own.
Why Digital Thread Matters
The Digital Thread is the capability to trace a product’s digital history and all of its related digital assets across its lifecycle. From the initial planning and analysis, through design, manufacturing, and testing and on to field operation and disposal, the Digital Thread weaves together the meaningful relationships and connections and decisions that drive bill of materials, parts, software versions, electronics, CAD models, documents, production plans, and service records.
Leading modern product lifecycle management (PLM) systems feature open connections and standards and deliver on PLM’s original promise of full lifecycle traceability, aka Digital Thread. In fact, maintenance (and MRO) are inherently a part of the product lifecycle that PLM is intended to support. Notably, as-built product configurations in PLM are an essential starting point for anyone pursuing the service market for complex assets.
To own the maintenance realm, organizations on either side of this battlefield need the Digital Thread connection for context. For example, a CAD rendering of a jet engine and the history of changes made through the engineering, manufacturing, and quality phases are highly valuable, unless you are in maintenance and don’t have the tools or expertise to decipher it and use it to do your job. Without access to the context — such as the tail number of the plane it’s installed on, information on where it is flying or has flown, and the history of maintenance changes — manufacturers will not be able to make accurate decisions on the product nor create next-generation, long-term, highly profitable service contracts.
Therefore, Digital Thread is a foundation for manufacturers to be able to offer and execute competitive service level agreements and for owner-operators to pursue new suppliers for critical spare parts.
Connecting MRO and PLM
Effectively, Digital Thread has the potential to level the playing field for manufacturers and owner-operators as it relates to service and maintenance. It opens the opportunity for both parties to disrupt the existing dynamics and/or gain competitive advantages by providing a real-time view from engineering to manufacturing all the way out to operating in the field. This allows faster, more accurate decisions to be made, resulting in improved performance and reduced downtime.
From the manufacturer’s perspective, owning this part of the business creates an opportunity for highly profitable and long-term service contracts to augment the low-margin business of engineering and manufacturing these products. Many are moving toward product-as-a-service models, and Digital Thread puts more within grasp.
On the other side are owner-operators who, in some cases, want to establish long-term contracts with the manufacturers (their suppliers), while others want to break down the barriers, built by the same manufacturers, in order to access spare part providers and develop their own direct relationship to help reduce the cost of operating long life complex products.
I mentioned earlier there is nuance to this dynamic. Here’s where it comes into play. Although product and maintenance information can be connected and readily accessible for both sides with Digital Thread, in reality, each side views certain information as their “secret sauce,” meaning it is high value and sharing is not on the table. Therefore, both sides will ultimately need to come together and iron out the details. This involves collaboration and the realization by both parties that they are each well-suited for some of the maintenance, but not all. For example, does an owner-operator ever want to own the maintenance of an entire complex asset? How about the manufacturer? In most cases, no: each will be able to apply their own value to the components they can maintain best. In aviation, a Boeing or Airbus might take on the landing gear, Rolls-Royce or GE will manage the engine, and the rest can be maintained by the owner-operator as they see fit. To get to the next level, each will have to play their part in sharing critical information, which ultimately benefits all parties.
Turning Weakness into Strength – Tap into Legacy IT with the Digital Thread
But, before this battle can be won, manufacturers still have to overcome a problem that continues to plague them — the legacy IT systems that have given rise to broken connections and disconnected product processes. Legacy PLM software was intended to share information across the product lifecycle. However, increasing product complexity is now revealing legacy IT system shortcomings. Now, just when organizations need to collaborate and share information most, their systems are the least able to handle the increased complexity (and as a result often revert back to old, error-prone record-keeping methods like spreadsheets). All of this can be changed by harnessing the Digital Thread.
Conclusion: Gaining Competitive Advantage by Moving First
Both sides, manufacturers and owner-operators, need to free the information that has been locked up in legacy systems for years. When this happens, it helps both sides enjoy the benefit of sharing new ideas and information throughout the Product Lifecycle. For example, manufacturers that are not open to sharing Intellectual Property on specific designs for OEM parts may find it difficult to continue relationships with customers, especially those who want access to develop their own supplier network in order to reduce costs. This battle for owning the profit centers of service will be a hard fight, but if they can find common-ground rules, there is room for both groups to benefit.
As product complexity increases, legacy applications across the product lifecycle will be the pain point that inhibits innovation and slows the progression of taking more of the maintenance battlefield. Industries such as Aerospace & Defense, Mining, Oil & Gas, and Power are at a tipping point where teams that don’t utilize a Digital Thread approach will struggle to deliver and advance with existing tools, processes and a siloed approach to sharing information.
As the stakes are raised, a Digital Thread approach to gaining ground in the maintenance realm will be key. Using this capability effectively will allow companies that are developing manufacturing and operating complex assets in a variety of industries to disrupt the playing field and gain competitive advantages. Each faction is moving at a furious pace, taking on more responsibility, and creating new services to control the highly profitable, long-term business of maintenance — now, it’s your move.
Jason Kasper is a product manager for Aras Corp, a provider of enterprise PLM software.