Lockheed Martin Challenges Its Suppliers to Embrace Lean Practices
Fort Worth, Texas, September 24th, 1999 -- Lockheed Martin challenged its major suppliers to implement lean practices to improve quality and reduce costs and span times, during a conference held Sept. 20-21 in Fort Worth, Texas.
More than 500 representatives from the top 245 suppliers attended the second annual supplier conference hosted by Lockheed Martin’s Aeronautics Sector. The Aeronautics Sector is one of the major business sectors within Lockheed Martin and is composed of the four major aeronautical companies within the corporation. The Sector has a consolidated procurement activity in Fort Worth, known as the Aeronautics Material Management Center (AMMC). The conference was part of the Aeronautics Sector’s efforts to obtain best value from its supplier base in terms of schedule performance, cost and quality.
The focus of the conference was lean supply chain management. Emphasis was placed on the critical role the supplier base plays in the success of the corporation’s lean supply chain initiatives and how lean principles can make suppliers more competitive.
"The key to affordability is the implementation of lean principles to reduce waste, reduce cycle times, improve quality and lower costs," said W. A. "Micky" Blackwell, president and chief operating officer of Lockheed Martin’s Aeronautics Sector, whose opening remarks set the tone for the event. "Since suppliers contribute roughly half the cost of producing aircraft and play a major role in the time span from initial contracting to delivery, it is essential that they join the prime manufacturers in implementing lean practices."
Mike Joyce, vice president of operations for the Sector, described several lean manufacturing projects that have been implemented at all the companies within the Aeronautics Sector. Joyce said, "We have experienced dramatic improvements. Implementing lean is free money. Our joint challenge is to implement these principles at all suppliers to create a value stream, or total team value, for our customer."
Mike Walters, vice president of procurement for the Sector and head of the AMMC, emphasized that adoption of lean initiatives is a requirement for maintaining a long-term relationship with Lockheed Martin. Walters asked each supplier to commit to lean principles and to work with Lockheed Martin to develop implementation plans by the end of November of this year.
Ratings and feedback reports were provided to each supplier to reflect the Sector’s view of their performance. In addition, the suppliers were asked to evaluate the Sector’s performance as a customer in comparison with other primes. The survey indicated many areas considered "best in class" but also identified some areas for improvement. "Knowledge sharing is key to successful teamwork," Walters said.
The presidents of each operating company within the Sector gave an overview of current programs and future business prospects for their company. Walters concluded the conference by adding, "Our company presidents have shown what is being done to be more competitive and win new business. We need you to join the lean team."]
Lockheed Martin’s Aeronautics Sector consists of four major companies – Lockheed Martin Tactical Aircraft Systems, Fort Worth Texas; Lockheed Martin Aeronautical Systems, Marietta, Ga.; Lockheed Martin Skunk Works, Palmdale, Calif.; and Lockheed Martin Aircraft and Logistics Centers, Greenville, S.C. Together, these companies comprise the world’s largest provider and supporter of military aircraft. The Sector’s major products include the F-16, F-22, F-117 and C-130J. Lockheed Martin is also competing for the next-generation Joint Strike Fighter (JSF) program, teamed with Northrop Grumman and British Aerospace.