Competitive Product Development at Daher – French Aircraft Manufacturer and System Supplier to the Aerospace Industry

Due to the pressure of intensifying global competition, there is a feeling among manufacturers, suppliers, and subcontractors in the aerospace industry that they are increasingly forced to reduce costs while having to continuously act faster. In order to prevent this balancing act from becoming a business dilemma or safety issue, it is vital to find creative ways of confronting ever-increasing pressure in the early stages of development.

Competitive product development – a holistic approach from Ingenics that also includes efficient cost management – has been applied with resounding success in a project at Daher, the French aircraft manufacturer and Tier 1 supplier. This has created a solid foundation for achieving ambitious targets in terms of quality and prices.

The starting point was a contract for Daher to develop and produce the fuselage for a new business jet. The director of Ingenics France, Alexandre Zisa, has many years of personal experience in aircraft manufacturing and competitive product design (CPD). He was faced with a real – though not unusual – challenge: according to all the calculations, there would be a negative margin for the work package that had already been more or less developed. The consultants from Ingenics were tasked to help bring the order back to profitability as quickly as possible.

It was clear to the team that any further delay threatened to magnify the negative effects. It was therefore necessary to develop ideas and take action very quickly. Once Alexandre Zisa had familiarized the Daher project team with the Ingenics approach of competitive product development, a series of measures were decided with immediate effect. The primary objective was to regain control over margin while generating approaches to allow decisive improvements in the future.

The main concern for Ingenics experts as well as the Daher project team was to establish an efficient cost control system and to create a clearly defined project budget. Projected costs were checked, updated, and optimized on a weekly basis with participating teams – an approach that raises awareness for maximum cost transparency and that ensures this is largely taken into account. At the same time work was done to improve communication and cooperation between the different teams.

Additional potential savings were identified in the supplier relationship analysis with the aim of securing a positive margin. These were realized partly through targeted optimization measures and partly by changing suppliers without having to compromise in terms of performance or quality.

Previous experience dictates that competitive product development that is successful, long term, requires one more factor: sound team coaching at every level. At Daher, it was possible to involve every department – from project management and program management to engineering, procurement, and production. Ingenics experts supported the project manager in the areas of project organization, cost assessment, and cost control, arranging internal and external workshops (e.g. with suppliers) in order to achieve greater cost transparency or to determine additional component improvements. The engineers were actively supported in their redesign work, with expected development costs being taken into consideration at all times. Especially for the procurement team, cost transparency and component improvement workshops were developed and carried out in order to guarantee the best possible implementation of the project outcome.