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October 29, 2009

Knowledge Based Solutions can keep the Aviation industry afloat…

At an average the net profit margin of the airline industry stands at around 2-3%. How can this profitability be enhanced further for long term sustenance of the industry? The key lies in the current cost structure of airlines. According to various statistics, the cost contribution for the airlines is projected as fuel cost 49%, aircraft cost 18%, crew cost 14%, maintenance cost 14% and others 5%. Costs like fuel and aircraft are beyond the control of airlines and are driven by many external factors. The next biggest cost is maintenance and airline industry can directly control this cost by improving its effectiveness and efficiency. Typically maintenance of air fleet consists of both scheduled and unscheduled maintenance activities. Scheduled maintenance involves daily checks, A, B, C, D checks. There is about 60% chance of having damages found in these checks which require repair. The unscheduled maintenance include repair of unforeseen damages caused by events like bird hit, hail storm, lightening strike etc.  It is essential to shorten the repair cycle time and increase the availability of aircrafts for operations. This is evident from the fact that each aircraft on the ground cost is estimated to be about $100k per day.  

Further introspection and analysis would help to address this problem. The cost of maintenance includes both material and labor cost. In this labor cost can be reduced to sizable extent by using advanced technologies like knowledge based engineering (KBE). Let us look at more carefully the entire repair and maintenance cycle of airframe. Through knowledge based solutions, costs involved in activities given below can be reduced drastically
        Managing manuals like Structural repair manuals (SRM), Component Maintenance Manuals (CMM), Aircraft Maintenance Manuals (AMM) etc
        Finding and following the instructions given in manuals
        Diagnosing and assessing the damage
        Identifying repair solution from manuals
        Preparation of repair procedure and documentation
These activities consist of about 22% of the total labor costs of airframe maintenance. A conservative estimate shows that this can be reduced to about 5% by using knowledge based solutions. Hence, about 17% savings can be realized.

Knowledge based solutions and Knowledge Based Engineering (KBE) in particular is based on capturing repair and maintenance knowledge and embedding this knowledge into a web based systems (KBE system) and utilize such system in the repair and maintenance of aircraft.  For example, if we look at the SRM manuals alone, there are voluminous documents. It is also not easy to interpret them to identify a repair solution for a typical damage. The situation is even more complex for composite based aircrafts whose documents will be much more voluminous compared to metallic aircrafts. Think of an equivalent web enabled, knowledge based system which can provide repair solution based on certain queries from the users. This will replace static voluminous documents with an expert system. In earlier days technology was not matured enough to create such advanced systems. Now this is certainly possible. There are many such scenarios where we are collaborating with our customers to leverage technology and in particular knowledge based solutions for enhancing effectiveness and efficiency of engineering and maintenance activities towards driving up the profitability of the industry.

Do you see any such trends in the industry you operate?

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