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        Students in supply chain management team with Delta Flight Products in case study

        June 15, 2020 By Joe McAdory

        All News

         

        Delta plane with underlying text: DFP Opportunity for Improvement; Developing a practical system for replenishing, stocking, and managing MRO inventory

         

        “The Auburn Supply Chain students were presented a real-life problem statement related to our operations. They collected the raw data from our ERP system and, with little guidance from my team, were able to process the data and present Delta Flight Products with practical solutions that were immediately implemented.”

        — David Steinmetz, Delta Flight Products VP of Quality and Supply Chain 

        The Harbert College is dedicated to partnering with companies and alumni to engage industry and improve business practice. It's even more impactful when this opportunity intersects with our passion for providing relevant, forward-looking, and engaging curricula, instruction, and high-impact experiential learning opportunities for students.

        Delta Flight Products, a wholly-owned subsidiary of Delta Air Lines, designs and creates innovative aircraft interior products, including in-flight entertainment systems and rest enclosures for pilots and crew. Their operations team has excelled at ensuring the supply of raw materials kept up with their phenomenal growth, but an opportunity was identified for improvement in how they managed inventories of maintenance, repair and operating (MRO) supplies such as drill bits, gloves, sandpaper and adhesives.

        Delta Flight Products is a sponsor of the Supply Chain Center for Innovation at the Harbert College. Working with an Operations Management class, they challenged students to solve how they could properly and efficiently store and maintain essential MRO supplies.

        Slide titled Recommendation Summary with the following points: Step1. Item Categorization; Step 2. Reboot stockroom inventory management procedures; Step 3. Route all MRO purchases through a single buyer; Step 4. Consider implementing a VMI based systemA five-student team from Harbert College’s Supply Chain Management Program – Lillian Wagner, Calvin Gayles, Hunter Hendricks, Thomas Kahl and Hannah Lovik – recently proposed solutions before Delta Flight Products managers as part of an Operations Management spring semester class project.

        “Delta Flight Products gave us a ton of data on transaction and purchase history and turned our students loose,” said David Strickland, Harbert College Lecturer in Supply Chain Management who teaches Operations Management. “They said, ‘Come back with recommendations.’”

        “This is the type of project that we regularly assign to our students,” said Brian Gibson, Executive Director of the Center for Supply Chain Innovation. “When a Center for Supply Chain Innovation sponsor like Delta Flight Products brings us a problem, I work with our faculty to find the most appropriate course to solve it. Fortunately, faculty members like David and his students love to engage with the industry and attack challenging supply chain problems.”

        The 39-student class worked on the project in teams throughout the semester, with one final five-member team chosen to present before Delta Flight Products managers. Teams met in-person until COVID-19 mandated remote instruction beginning in March. From there, teams met via Zoom.

        Located near Hartsfield-Jackson International Airport in Atlanta, the subsidiary of Delta Air Lines often finds itself working on aircraft interior projects that contain overlapping parts.

        Slide titled Conclusion with the following points: By categorizing MRO items and implementing restocking decision rules, it is possible for DFP to have a well functioning MRO inventory management system; Dedicating one person as the MRO buyer is a self-funding step that should ensure a successful implementation of our recommendations; We believe DFP should first focus on recommendations #1–3 in order to have an MRO system that is organized and efficient prior to considering a VMI option“The students found that some items were needed quite frequently, often in different areas of the facility,” said Strickland. “They recommended that these repetitively purchased items be stored in their stock room and tracked. The students came up with recommended stocking guidelines, including minimum levels and order quantities to be able to top it up to a certain level.”

        However, for the parts that were only purchased once over an extended period of time, the students recommended to purchase the items on a spot basis and bypass the stock room when they are received, going directly to the department that requested them. Strickland said, “the students pointed out that there’s no need to keep up with reorder points on items you’re not reordering.”

        Another key recommendation made by the students was to assign one buyer to handle all MRO purchases and supervise the stock room. Strickland said, “the students analyzed the purchase history and found that up to six different buyers had made purchases of the same item at different price levels, sometimes on the same day. When they crunched the numbers, they found that roughly $85,000 per year could be saved if DFP consistently took advantage of the lowest prices, which is much easier to do when the purchases are consolidated under one person. This recommendation was essentially self-funding.”

        ““I’ve done a lot of projects, and this has been by far my favorite. It gave us real-world experience. It was exciting because we were looking at real data.” -- Hunter Hendricks, senior in supply chain management”

        Students also recommended to consider hiring a vendor to manage the MRO inventory.

        “I’ve done a lot of projects, and this has been by far my favorite,” said Hunter Hendricks, a senior currently interning at Lockheed-Martin in Marietta, Georgia. “It gave us real-world experience. It was exciting because we were looking at real data.”

        “I joined the Zoom call for the team’s final presentation, and they did a fantastic job,” Gibson noted. “They provided actionable recommendations for Delta Flight Products to improve inventory management, reduce down time, and save money.”

        “The Auburn Supply Chain students were presented a real-life problem statement related to our operations. They collected the raw data from our ERP system and, with little guidance from my team, were able to process the data and present Delta Flight Products with practical solutions that were immediately implemented. The excellent solutions presented by the students are a testament not only to their professionalism, but also to the quality of the Auburn Supply Chain program,” said David Steinmetz, Delta Flight Products Vice President of Quality and Supply Chain.

        Delta Air Lines’ relationship within other facets of Auburn University has deep roots. Not only did the airline partner with the Radio Frequency Identification Lab at Auburn University in 2018, which created a 42-passenger simulation bay, baggage loading area and service hangar space, but it also selected Auburn Aviation as one of nine colleges nationally in 2018 to participate in the Delta Propel Pilot Career Path Program.