Boeing Engineers Cite Time Spent Fixing Errors in Outsourced WorkSeptember 09, 2009

 

The union that represents Boeing's engineers is demanding that the aerospace company track how much time its members spend on fixing the mistakes of "outsourced" engineers for the 787 Dreamliner, according to a recent article in the Puget Sound Business Journal.

The Society of Professional Engineering Employees in Aerospace (SPEEA) contends that its members spend nearly half their time fixing outsourced work, making the local engineers seem less productive and driving Boeing to outsource even more work.

The issue is of critical importance because Boeing's 787 Dreamliner, after years of delays and design flaws, is inching toward its first flight test and the company has said it plans to begin deliveries in 2010. The tussle between Boeing and the union reflects tensions connected to whether or not the company will open a factory outside Washington state.

Boeing told the Puget Sound Business Journal that it "routinely" evaluates the quality of the work done by suppliers and is committed to the "business model and global strategy." A spokesperson told the Business Journal: "We're redrawing the lines, and adjusting where necessary, work that we do in house and contract out."

The issue of rework, or more generally the issue with product quality in outsourced engineering and production, is a common one, according to Serguei Netessine, a Wharton operations and information management professor. Any company that relies on outsourced components needs to invest in at least two things: inspection of incoming parts and communication of engineering specifications, he says.

"If defects do happen, then the right way to handle them is not to simply ask your own engineers to do re-work," says Netessine. "This approach only breeds more defects and does not address the root cause of the problem." Instead, defective parts should be returned to suppliers for rework, giving greater incentive to get the job done right in the first place and to understand the source of errors.

"Of course, business realities can make sending parts back economically infeasible and/or time consuming," Netessine points out. "Still, there are other ways to get the supplier involved in rework."

One common approach is to invite supplier engineers on-site and have them observe consequences of their errors and to have them report back to their home factories. "The famous Toyota production system advocates this collaborative approach such that Toyota and suppliers work closely to overcome quality issues," says Netessine. Either way, it appears that feedback about product quality is lacking and this is what needs to be fixed.

Many companies have systems that track defective parts from suppliers, he added. For example, in the automotive industry, when customers make warranty repairs, manufacturers often return faulty parts and the suppliers are charged for repair costs.

But Netessine also allows for the possibility that union complaints are more aimed at bidding up the prices of their contracts. "In this case, once again, including suppliers in the repair loop would make it obvious where the source of the problem is," he says. "Is it technical mis-specification? Production errors? Or maybe there is no problem at all."