Aircraft big data entering the skies of next-generation maintenance

04 May 2016 Consultancy.uk

As a new fleet of modern commercial airliners takes wing, so does a new breed of maintaining them. New aircrafts are becoming a rich source of big data as many of their systems and components are constantly being monitored. The information allows OEM, operators and MRO to constantly monitor the heath of planes as well as improve the decision making process around maintenance. While the technology promises much, a new report highlights that so far a business case remains elusive. 

Big data has been making headlines in a number of industries, promising to revolutionise the way in which businesses are able to make decisions, thereby leading to greater operational efficiency, cost reduction and reduced risk. One of the sectors slated to benefit from the use of big data, and associated analytics, is the aviation industry. Maintenance of aircraft through the collection of data has the potential not merely to create transparency and improve maintenance outcomes – such as decreased downtime – through aircraft health monitoring systems, but also to improve long term outcomes through predictive maintenance system. 

In a new report from Oliver Wyman, titled ‘MRO Big Data - A Lion or a Lamb?’, the consulting firm explores the current state of big data deployment within the aviation industry, as well as consider the current challenges faced by OEM, operators and MRO. The report is built from a survey of the wider industry, and is predominantly based on C-suite respondents. 

The growth of aircraft big data
Following a marked decrease in fuel prices, as well as increased interest in travel – especially within the Asia-Pacific region – investment in next-generation aircraft and supporting technology infrastructure has picked up in recent years. The growth of next-generation aircrafts is projected to rise rapidly, reaching more than 15,000 by 2026. As the number of planes grow, so does the amount of information gathered from the fleet

The newest aircraft lines have technologies on board that are able to measure and record an extremely wide variety of metrics across a range of areas – at the system and part level. Currently, around 2 exabytes of data are generated every year, by 2026 this may have grown to a staggering 98 exabytes per year – by comparison, the total global IP traffic reached around 966 exabytes in 2015.

Data based maintenance
The utilisation of the currently generated large volumes of information remains relatively low. From all respondents, 27% say that they rely on aircraft health monitoring (AHM) systems to manage all the aircrafts in their fleet, while 29% say they rely on it for select fleets – 44% of respondents however, do not use the data they gather for health monitoring. 

The data on engines is the most interesting to respondents, cited by 89% as an area where health monitoring is used, followed by airframe maintenance, at 55%, and component maintenance, at 43%.

The use of predictive maintenance (PM) technology is less often deployed by respondents. A total of 56% do not use the method at all, while 25% use it in select fleets only and 19% on all aircrafts. Again, engine maintenance is the major focus in this category, although airframe maintenance and component maintenance are closer in use, at 29% and 33% respectively. 

The generation of large amounts of information which needs to be combed for actionable – maintenance related – insights remains daunting for a number of respondents, and creates new storage, organisation, and application challenges. Many operators are opting, initially maybe, for more modest data analytics programmes that focus on a restricted subset of the information – often aimed at creating high impact advantages. 59% of the respondents are planning to restructure AHM to small sub-sets of data – either themselves or through third parties. For those using PM, 83% focus on narrow subsets, while only one in five expect to apply predictive techniques to all available data.

Reported data benefits
The business case for a wide-scale deployment of big data solutions within the aviation industry remains elusive for many respondents. The report asked respondents that have implemented AHM and to a lesser extent PM about the improvements to operations. AHM is shown to be the most effective at reducing reliability issues, as cited by 63% of respondents, followed by a decrease in engine maintenance costs, cited by 35%. The technology is considered to improve costs in technology maintenance and total cost of ownership by 20% in each category. Many of the indicators on the maintenance side do not show a noticeable improvement from the adoption of AHM.

On the PM side, particularly a cost reduction in airframe maintenance is noted, at 37%, followed by a decrease in engine maintenance, at 33%. A noticeable increase in reliability is further noted by 30% of respondents using the technology. 

According to the report, “Outcomes like reliability gains and cost savings are tangible benefits operators can point to in justifying further investment in analytics – hardware, software, and people. And yet, other sources of value traditionally required in investment cases (such as spare parts reductions, shorter turn times) are less commonly experienced, suggesting significant work remains to tap the full potential big data technologies offer.” 

Concerns about the effectiveness of the technology is reflected in respondents’ reflection on whether organisations believes AHM systems have reached a level of maturity. As it stands, 8% believe the technology has reached the level of sophistication anticipated for this technology, while 22% believe it is rapidly becoming a core decision-making tool. A large proportion of respondents see the technology as gradually becoming a core decision-making tool, at 37%, while 22% of respondents believe the technology is still at an early state, and 8% of respondents say it is not ready for a thorough investment. 

The consulting firm adds: “we expect investment will continue as users integrate these technologies further into airline technical and MRO organisations, possibly even ahead of an established history of tangible benefits. Tellingly, half of respondents (53%) said they plan to invest further in AHM over the next three years.”

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Four ways digitalisation is transforming car brands and dealers

16 April 2019 Consultancy.uk

From changing expectations from the customer to new stakeholders entering the industry, the digital transformation of global automotive industry means it is facing the wholesale transformation of its business model. In a new white paper, global consulting partnership Cordence Worldwide has highlighted four major digital trends that are transforming the relationships between car brands and dealers with consumers.

With digital transformation drives booming across the industrial spectrum, automotive groups are no different in having commenced large digital transformation programmes to improve productivity, efficiency, and ultimately profitability. Falling sales figures mean the automotive sector is facing an increasingly difficult road ahead, something which means companies in the market are even more hard pressed to find new ways to improve their bottom lines.

While it offers major opportunities, the industry’s move to digitalise is not without complications. It has triggered a series of major internal changes, which have presented automotive entities with the challenge of becoming a “customer-oriented” industry. A new report from Cordence Worldwide – a global management consulting partnership present in more than 20 countries – has explored how automotive companies are navigating the rapidly changing nature of digital business.

New business models

The level of change likely to be wrought on the automotive industry by digitalisation is hard to overstate. Automation could well lead to significant reductions in the number of accidents, higher vehicle utilisation and lower pollution levels, while leading to a $2.1 trillion change in traditional revenues, with up to $4.3 trillion in new revenue openings arising by 2030.

As a result of this colossal opportunity, it is easy to see why almost all automotive groups now have digital departments, with generally strong communication within the digital transformation and the customer approach. The changes to society which this may have are potentially distracting automotive firms from the change it is leading to in its own companies though, according to Cordence’s paper.

The automotive market is dead, long live the mobility market

Because of this, the sector’s business model is set to transform over the coming decades. With digitalisation speeding up the appearance of concepts such as car-sharing, a subscription package model will likely become more palatable. At the same time, car and ride-sharing models will cater to the sustainability criteria of millennials, who will rapidly become one of the automotive market’s leading consumer demographics in the coming years.

Antoine Glutron – a Managing Consultant with Cordence member Oresys, and the report’s author – said of the situation, “These ‘old school industries’ are now working on creating new opportunities, but in so-doing are facing challenges and threats: new jobs, new technologies, new ecosystem of partners, necessary reorganisation, different relationship with customers, and even new businesses. The customer approach topic is in fact a real challenge for car companies as it implies changing their business model and adjusting their mind-set to address the customer 4.0: from product-centric to customer-centric, from car manufacturer to service provider.”

Digital customer experience

In the hyper-competitive age of the internet, even top companies face an uphill challenge when it comes to holding onto customers through brand loyalty. Digital disruption has resulted in changes to consumer behaviour, which is forcing a range of marketing strategists to reconsider their old, possibly out-dated strategies. As modern customers wield an increasingly impressive array of digital tools and online databases, they and are now able to quickly and conveniently compare prices, check availability and read product reviews.

The automotive sector is no exception to this trend, according to the study. In order to adapt to the needs of the so-called ‘customer 4.0’, car companies will increasingly need to change their business model and move away from product-centric companies to customer-centric ones, from car manufacturers to service providers.

Glutron explained, “As an automotive company, you can no longer expect customer loyalty simply with good products; you must conquer and re-conquer a customer that “consumes” your service. The offer now has to be global, digital and personalised. Your offer has to be adapted to this customer’s needs at any given moment. A key issue related to data control is to build customer loyalty by creating a customer experience 'tailored' throughout the cycle of use of the 'car product': purchase, driving, maintenance and trade-in of the vehicle.”

One way in which the sector may be able to benefit from this desire for a tailored experience is via connectivity. Consumers are generally positive about new connective features for automobiles, and many are even willing to pay upfront for infotainment, emergency and maintenance services. Chinese consumers, where the connected car market is set to hit $216 billion, are already particularly interested in paying a little more for navigation and diagnostic features in their future new car. This can also enable automotive companies to exploit a rich vein of customer data, enabling them to rapidly tailor their offerings to consumer behaviour.

New automotive segments

Digital transformation has also brought with it the rise of completely new application areas. As mentioned earlier, the most well-known example is the autonomous or self-driving car, where the last steps forward were not taken by major automotive groups but by technology companies such as Tesla. While this may have given such firms the edge in the market briefly, a number of keystone automotive names will soon be set to take the plunge into the market themselves, leveraging their car manufacturing prowess and huge production capacities to their advantage.

Before companies rush to invest in this market, however, it is worth their while to remember that the readiness and uptake for such vehicles differs greatly geographically. For example, following a study published in 2018, 92% of Chinese would be ready to buy an autonomous car, compared with only around 35% of drivers in France, Germany and US. Meanwhile, the infrastructure of different nations will also be significantly less accommodating of the new technology.

Use digital for steering thr activity

Elsewhere, Cordence’s analysis has suggested that hooking the cars of tomorrow into the Internet of Things is also likely to see a rapid change in the business model for car maintenance, providing real-time diagnostics for problems. This presents chances for partnerships to improve the connectivity of cars, especially with tech companies; for example, PSA partnered with IBM for a global agreement on services in their vehicle. Meanwhile, data could also be sold to other parties with an interest in this data, such as the government, which could use it to manage traffic levels, or ensure that only adequately maintained vehicles take to the road.

Glutron added, “With the increase in the amount of client data and connected opportunities, the recommendation is to set up data-centric approaches. The value is now in the customer data. The general prerequisites are to rework the data model and the Enterprise Architecture and generally build up a data lake including data from all sources (internal and external, structured and unstructured).”

From automotive to mobility

Relating further to the idea of connectivity, the report claimed that automotive firms must now adjust their models in line with the provision of end-to-end mobility, rather than treating the sale of a car as an end point in their relationship with the customer. In order to realise this transformation, transformations are likely to become more and more important.

A network of partner companies means automotive firms can provide a global mobility experience. As the vehicle is increasingly connected to its environment, new partners can also be cities, governments, and other service providers within the global mobility services industry in which the car brands want to take part.

According to the study, the target is clear. Companies must look to a holistic transport service, offering to move customers from A to B in a unique and pleasant way – otherwise they might as well take public transport. At the same time, they should extend the services reachable “on-board” (especially the enhancement of the connectivity between the car and smartphones or other connected devices), and reach high standards in terms of user experience (online sales, online payment, customised experience during and after the use of the car).

Concluding the report, Glutron stated, “These mobility market transformations could be considered a threat for the car manufacturers. Quite the opposite: if they take up the challenge and review their business model so that they become the service provider – communicating no longer to a driver but to a ‘mobility customer’ – they can then take advantage of their expertise and their position as a historical player. The most convenient means of transport are cars, and building a car is highly-skilled work.”