supply chain processes for quality products -...

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Approved for Public Release

17-MDA-9021 (13 February 17)

Supply Chain Processes for Quality Products

Mr. Chris Miller, PE

Chief, BMDS Quality Division

Missile Defense Agency (MDA)

Version 4.0

March 2017



17-MDA-9021 (13 February 17)

Introduction 1/3

Why should we consider supply chain processes?

2

• We depend on our

suppliers

• Many challenges or

issues we face originate

at a supplier

MAP – MDA Assurance Provisions



17-MDA-9021 (13 February 17)

Introduction 2/3

How can we better manage our supply chain?

• Investigate MDA’s supply chain management performance and processes

• Investigate and benchmark supply chain management processes from

other organizations

– Commercial Aircraft Manufacturer

– Automobile Manufacturer

– Select United States Air Force (USAF), National Aeronautics and

Space Administration (NASA), United States Navy (USN) programs

• Evaluate key supply chain questions

– How well do you know your suppliers?

– How well do you know you know the technical design of products

provided by suppliers?

– How much control do you exercise over your suppliers?

3



17-MDA-9021 (13 February 17)

Introduction 3/3

Develop and implement supply chain process

improvements for MDA

• Increase Supplier Engagement and Awareness

– Made for MDA

– Supplier visits and interaction

• Improve Supply chain contract requirements

and metric data

Lesson Learned -- Verify requirements flow down

and implementation

4



17-MDA-9021 (13 February 17)

Contents

• Introduction

• Background Information

– How well do you know your suppliers?

– MDA Technical Assessment Findings

• How can we better manage our supply chain?

– Investigate and benchmark supply chain management processes from

other organizations

– Case Study: Commercial Aircraft

– Case Study: Automobile Manufacturing

– Literature Review

– Supply Chain Control Over Product Life Cycle

– Common Supply Chain Management Best Practices

• Missile Defense Agency Supply Chain Management Improvement Initiatives

• Conclusion

5



17-MDA-9021 (13 February 17)

How well do you know your suppliers?

6



17-MDA-9021 (13 February 17)

MDA Assurance Provisions (MAP)

Core Assessments

Supplier Management Common Finding Topic

CY2014-2015

CY 2015 -- 2016



17-MDA-9021 (13 February 17)

Summary of InterviewsGeneral Observations

o Significant variation in Supply Chain Management processes including design control and

supplier selection

o Most desire greater visibility into lower tiers

o Investment up front lowers lifecycle costs

o Many rely on prime contractors to ensure effective Supply Chain Management

o Common reaction to issues: Send engineering & quality staff to suppliers

Best Practices

• Advocates partnering with suppliers to resolve issues

• Regular engagement critical to Supply Chain Management success

• Place program personnel at suppliers

• Regular engagement at executive level

• Post Award Conferences to review all requirements

• Maintains visibility to the individual parts and materials level

• Significant investment and control over supplier, process & product qualification

• Incentivize Supply Chain Management and overall contract performance

• Data driven Supply Chain Management

8



17-MDA-9021 (13 February 17)

Case Study – Commercial AircraftKey take-aways:

o Increased outsourcing from historical practice

o Over budget and late

o Implemented new outsourcing model without tight control of

the design and engineering

o New Supply Chain Management process lost visibility, control,

and inhibited communication

o Make or buy decisions did not consider lifecycle costs

o Cost cutting & outsourcing approach lacked steps to mitigate or

eliminate predicted risk & known issues

o To minimize potential problems, aircraft developer should

provide onsite quality, supplier management, and technical

support

9



17-MDA-9021 (13 February 17)

Case Study – Automobile Manufacturing

Key take-aways:

Controls entire vehicle design and engineering from top

level to piece part level

Fully integrates suppliers into the product development

system

Suppliers selected based upon performance and ability

to mesh with broader supplier network

Selected for innovative processes and cost reductions

Expected to share innovations with other suppliers

10



17-MDA-9021 (13 February 17)

Literature Review

11

Best Characteristics – Strategic Level

Best Supply Chain Managers Use these Types of Metrics

Best Characteristics – Implementation Level

• Visibility down the entire supply chain; or at least the

critical path

• Integrate key suppliers into the development system

• Identification of the true critical path, may be multiple

paths

• Alternate suppliers where necessary

• Working relationship with suppliers of critical parts

• Contractual requirements flowed down to sub tier

suppliers

• Supplier managed logistics for smaller piece/part item

• Consistency of Leadership

• Strong Horizontal Processes and Organization

• Technology Implementations done Right the

First Time

• Strong Capabilities in Supply Chain Planning

and Network Design

• Source, Make, and Deliver Reporting to a

Common Leader

• Clarity of Supply Chain Strategy and a Clear

Definition of Supply Chain Excellence

o Quality

• Defects per Unit

• Defects per Million Opportunities

• Quality escapes

• First-pass yield

Council of Supply Chain Management Professionals (CSCMP) Supply

Chain Quarterly (Quarter 3, 2015).

o Cost

• Cost Per Unit Reduction

• Total Lifecycle Cost

• Cost of Poor Quality

o Schedule

• On Time Delivery

• Lead time reduction

o Reliability

Multiple Sources

Multiple Sources



17-MDA-9021 (13 February 17)

Design and Supply Chain Control at the Prime Contractor or Government

Level – Spectrum for Designing Supply Chain Management Processes

12

Lifecycle milestones

Criticality LevelLow Criticality High Criticality

Am

ou

nt

of

Co

ntr

ol

Loose or

Delegated

Control

Tight or No

delegated

Control

PDR CDR Production

PDR – Preliminary Design Review

CDR – Critical Design Review

Nominal

Increasing

Control

Glide Path

Typical MDA,

some NASA &

USAF programs

Typical Nuclear Safety Critical Products

Leading Automobile Manufacturer (Controls Design – Partners &

Collaborates with Suppliers)

Control Design at piece

part level and control all

supplier selection

Control Design at End Item Level

Commercial Off The Shelf

Level of Design authority delegation should be based

upon the risk and criticality of the top product mission



17-MDA-9021 (13 February 17)

Supply Chain Management

Best Practices

• Incentivize Supply Chain Management

performance

• Use data to drive Supply Chain Management

improvements

• Increase control of design, parts, materials and

processes as required.

• Engage regularly with suppliers

13

Lesson Learned -- Verify requirements flow down and implementation



17-MDA-9021 (13 February 17)

MDA Supply Chain Management

Improvement InitiativesKey Ongoing Initiatives

• Supplier conferences by program (4 complete, 2 planned, annual event)

• Monthly quality metric reviews (Defects Per Unit and Escapes for past year)

• MDA/Industry Quality Forum (conducted 2 – 3 times a year for past two years)

• Made for MDA (In development. Pending approval)

– Awareness campaign

– e.g. video, posters, stickers

• Joint MDA and DCMA Technical Assessments (Full participation started in FY16)

– Moving deeper into the supply chain

– MDA Assurance Provisions (MAP) Revision B and Parts, Materials and

Processes Mission Assurance Plan (PMAP)

• MDA Assurance Representatives (MAR) Regional Plan

• First Article Inspection process per new AS9102

Initiatives in Development

• Expand Supply Chain Management requirements in contracts

• Add first time yield and test problem reports to defects per unit and escapes

• Increase attention to requirements verification and supplier selection

14

DCMA – Defense Contract Management Agency



17-MDA-9021 (13 February 17)

Satellite

Surveillance

Sea-Based

X-Band Radar

Aegis BMD

SPY-1 Radar

Forward-Based RadarEarly Warning

Radar

SENSORS

ASCENTDEFENSE SEGMENT

BMDS

The Ballistic Missile Defense System

C2BMCCommand, Control, Battle Management and Communications

NMCC USSTRATCOM USNORTHCOM USPACOM USEUCOM USCENTCOM

Terminal High

Altitude Area

Defense

Ground-Based

Midcourse

Defense

Aegis Ballistic

Missile DefenseStandard Missile-3

SM-3

MIDCOURSEDEFENSE SEGMENT

TERMINALDEFENSE SEGMENT

GBIPatriot Advanced

Capability-3

Sea-Based

Terminal

Today’s Layered Ballistic Missile

Defense System (BMDS)



17-MDA-9021 (13 February 17)

17



17-MDA-9021 (13 February 17)

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