Lockheed Martin Supply Chain

LM Supply Chain

Lockheed Martin’s supply chain is responsible for approximately $11.2 billion annually with nearly 1,500 production suppliers and 900 non-production suppliers all over the world (Lockheed Martin, 2014). Lockheed Martin designed their supply chain using lessons learned from preceding programs, that addressed on-time delivery, and quality assurance. Once a contract is signed with a supplier, Lockheed Martin issues a Material Resource Planning requirement to initiate the procurement process. Engineers travel to each of the sub-contractors and perform quality and reliability testing on their components. ALIS has increased the overall effectiveness of the supply chain by automating tracking of parts. Lockheed Martin has also increased

an emphasis on supply network collaboration. Good communication with other stages of a supply chain often creates situations that highlight the value of coordination for both sides (Chopra & Meindl, 2016).
The JSF F-35 uses a push/pull view of the supply chain process; the processes are divided into two categories, depending on whether they are executed in response to a customer order in in anticipation of customer orders (Chopra & Meindl, 2016). JSF F-35 uses the push/pull view because, of the amount of suppliers, and partners that are involved in the program.
Pull processes are initiated by the customer (Chopra & Meindl, 2016), when a component fails on the aircraft; the vehicle initiates a report to the customer, reporting the failure. The customer acknowledges the failure and the report are sent to the supply department to fill the order. Push processes are initiated and performed in anticipation of customer orders (Chopra & Meindl, 2016). Scheduled maintenance evolutions require the customer to perform a time/life cycle change on JSF F-35 components. The maintenance evolution could be a tire change, which needs to be performed after a certain time period. Using the push process the supply department can have the tires ready in anticipation for the customer orders.
Global Supply Chain
JSF F-35 international partner countries production is more than 3,100 aircraft to be built through 2039 (Shalal, 2014). Globalization offers Lockheed Martin opportunities to simultaneously increase revenues and decrease costs. 1,500 of the 3,100 aircraft are destined for global partners and allies, contributing to $380 billion in the global economy. Currently there are 17 Australian suppliers, 80 Canadian companies, 4 Danish companies, 27 Italian companies, and 25 Dutch suppliers, included in the global supply chain of the JSF F-35 (Lockheed Martin, 2014).
Globalization comes is accompanied by increased revenue and reduced costs, but also greater risk. Uncertainty is the only constant in global supply chain management (Chopra & Meindl, 2016). Lockheed Martin is putting a lot of faith into its global supply system, the added layers of 9 countries contributing to the supply system brings greater risk and reward. The risks Lockheed Martin could face are, supply disruptions, supply delays, demand fluctuations, price fluctuations, and exchange rate fluctuations (Chopra & Meindl, 2016). Lockheed Martin is mitigating some of the risk by using multiple suppliers, and using ALIS as a real time demand forecasting platform.
The goal when designing a supply chain network is to maximize the firms’ profits while satisfying customer needs in terms of demand and responsiveness (Chopra & Meindl, 2016).

JSF F-35 Joint Program Office compiled and analyzed data to determine warehousing capability in the European and Pacific regions. The objective of the second phase of network design is to identify regions where facilities will be located, their potential roles, and their approximate capacity (Chopra & Meindl, 2016). The Joint Program Office determined that the Netherlands and Australia will be the warehouse and distribution centers for the European and Pacific regions (Lockheed Martin,

2014).

Technology
The JSF F-35 is the most technologically advanced aircraft in the world, the F-35 is the first tactical aviation system to have sustainment tools engineered in concert it he aircraft for efficiency and cost effectiveness.

Compared to previous aircraft, a higher fidelity of information about the F-35 fleet is tracked within ALIS to reduce operations and maintenance costs and increase aircraft availability (Lockheed Martin, 2015). ALIS employs a Prognostic Heath Management (PHM), Squadron Health Management (SHM), Anomaly and Failure Resolution System (AFRS), and the Computerized Maintenance Management System (CMMS) to increase efficiency in the logistical functions.

ALIS hardware is comprised of a Standard Operating Unit (SOU) supports ALIS, which can be setup in a space as small as a shipping container. The SOU incorporates modular components, can be carried by 2 people, and can be customized by the user. The SOU provides data to the Central Point of Entry (CPE), which is the hub for all data.

The SOU provides the information to Lockheed Martin to improve engineering and supply chain functions. The Standard Operating Unit (SOU) acts like a smartphone, sending information to the CPE, and then to Lockheed Martin so that data can be studied to allow the company to track parts availability, wear, and to spot unforeseen issues before they impact operation (Trevithick,

2017).
Flaws With ALIS

Using technology to control you supply chain system has inherent risks. ALIS has an even greater risk since it is involved with government and military systems. ALIS is an interconnected system that is susceptible to hacking and other malicious attacks. In accordance with Department of Defense (DOD) policy, a cyber security operational test was performed to see how ALIS performs against cyber threats. In 2012 a team working for the U.S. Navy using Cooperative Vulnerability and Penetration Assessments (CVPA’s), hacked into a portion of ALIS and highlighted issues about enemies getting into the system and disrupting the platform (Department of Defence, 2015). A disruption in the ALIS platform can occur from one of the may subcontractors that are involved in the program. In 2017 a squadron of U.S. Marine Corps F-35B Joint Strike Fighters were grounded due to problems with the software in its central cloud-based computer SOU (Department of Defence, 2015). The unit installed the software upgrade called Version 2.0.2, which caused “anomalies” in the system.
Cyber security isn’t the only flaw with ALIS; good IT systems are necessary but not a sufficient condition for success (Chopra & Meindl, 2016). Parts maintenance functionality has failed to alert ALIS users if incorrect sub-assemblies are being installed on a system changing the configuration of the system. ALIS is an automated system that takes input from the user and tracks inventory and configuration of each vehicle. Configuration management failures are related to the Electronic Equipment Logbooks (EELs). EELs track aircraft parts, inaccurate inventory information leads to flawed decisions and could in the worst case create mistrust among supply chain partners (Chopra & Meindl, 2016).
ALIS is still currently in the third phase of “operational development”, meaning that the system is not 100% functional. The platform is being tested and evaluated by the United States military in locations across the United States, and aboard naval vessels. The USS Wasp tested ALIS capabilities with little success. ALIS related data was slow to transfer over satellite communications, which impacted the aircrafts ability to fly their training missions, giving the team approximately 55% aircraft availability (Department of Defence, 2015). The SOU’s accompany the air vehicle wherever it goes, and testing is still being conducted in austere areas.
Conclusion

The JSF F-35 incorporates an Autonomous Logistics Information System that processes large amounts of data, increases supply chain efficiency, gives managers information to make decisions, and tracks potential failures. ALIS has over 65 functions that affect performance, safety, and long range planning. The JSF F-35 supply chain is massive, starting with Lockheed Martin and progressing around world to reach more than 9 customer countries. Having a supply chain that large increases risk, and reduces information flow. ALIS was created to fill the gaps in supply chain by automating most of the processes. ALIS has performed well in some areas, and has failed in others. The full extent of ALIS’ ability will not be seen until the JSF- F-35 platform has been delivered to all the customers, and the data has been collected and analyzed. ALIS currently tracks 3,000 parts per aircraft, 200 aircraft, 90,000 flight hours, and 20 different locations (Lockheed Martin, 2017).