In This Issue
More changes in the air for the U.S. aviation industry
When the Shareholder becomes the Customer
ASD&M News
ASD&M Events
Featured Articles
 
More changes in the air for the U.S. aviation industry
By: Dr. Michael J. Dreikorn
 
------------------- 

When the Shareholder becomes the Customer
 By: Alden B. Davis
 

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July 2009
 
ASD&M Quality, Safety and Regulatory
 Newsletter
 
Your source for professional connection
 
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The objective of this newsletter is to provide perspective to the Aviation, Space, Defense, and Maritime (ASD&M) industry on current and relevant quality, safety, and regulatory matters.
More changes in the air for the U.S. aviation industry
 
By: Dr. Michael J. Dreikorn
 Michael Dreikorn
 
   The first half of 2009 has already brought the U.S. aviation industry a substantial amount of change.  Production and maintenance work continues to move, and sometimes in surprising directions.  Examples include airline maintenance to South America and production work returning from China to the U.S.  The recessive economy continues to push organizations to tighten their collective belts and make some tough decisions.  Military spending has been up-in-the-air, and unfortunately landing a final blow to the F-22.  Needless to say, this is a very dynamic industry and requires organizations to have the ability to foresee change and to quickly adapt.  But how much attention are organization's placing on monitoring the changing environment of requirements?
 
   Earlier this year, AS9100C was released, bringing with it a number of additions, revisions, and deletions to the industry's standard for quality management.  The most notable revisions to AS9100C included expanded and more defined expectations for management's roles in managing the quality of the organization.  This also includes requirements for risk management and effective measurement in prevention.  Though registration to AS9100C will not actually start until November of this year, leadership needs to thoroughly understand the new requirements and engage process changes to ensure compliance.
 
   The second part of 2009 will continue to bring a number of changes to our requirements environment.  The FAA anticipates publishing significant revisions to 14 CFR Part 21 in October.  This will be the first major change to this regulation since 1964.  For those who are not familiar with 14 CFR Part 21, this is the set of regulations that govern the design, production, and continued airworthiness of U.S. civil aircraft.  According to the Notice for Proposed Rulemaking (NPRM), regardless of what type of production approval an organization holds, there will only be one quality system model.  Requirements for the quality management system are anticipated to be more closely aligned to AS9100.
 
   The FAA has also recently released an Advanced NPRM (ANPRM), requesting public comment on draft rules for Safety Management Systems (SMS).  Though SMS is not an entirely new concept, it is evolving from a voluntary process to one that will be regulated and enforced.  Similar to some of the new requirements of AS9100C, an effective SMS will proactively seek out potential risk, establish accurate measurement methods, and engage in prevention processes.  Though airlines and airports have been the traditional targets for voluntary implementation of SMS, the ANPRM suggests that it will also be required of repair stations and manufacturers.  
 
   So, who in your organization is keeping track of the changes in requirements?  Is your organizational leadership aware of the significance of these requirement changes?  What is your organization's plan for incorporating the requirement changes into your system?  More importantly, how is the organization going to integrate these changes into its culture?
 
   My recommendation is to get top leadership involved in the requirements process.  All too frequently the responsibility for compliance to FAA, ISO, AS, or any other such requirement falls to the shoulders of the quality leader.  In 2009, that's not good enough.  The new requirements specifically define top leadership engagement.  They need to understand what that means in order for them to effectively lead.  
 
   At the end of the day, an organization will comply with requirements because they have to.  The status of compliance may satisfy an auditor, but brings little value in sustainable performance.  However, when every member of an organization truly understands the importance of proactive processes and structured methods, and comprehends their value in the system, then they become committed to performance. No one will have to tell anyone that they "have" to do something.  People will know what is required and want to do it correctly because they believe in its importance.    
  
Michael J. Dreikorn, Ed.D.
President, The IPL Group, LLC
Principal Partner, ASD Experts 
 

When the Shareholder Becomes the Customer


by Alden B. Davis 
 

Alden Davis    

      "Our job is to maximize shareholder return," I am told at a recent management meeting. 
 
   This message has been gaining in prominence and momentum within internal corporate communications since the mid-90s.  Have you noticed how these words have become management's manta in the corporate world? 
 
   Somewhere along the way, publicly traded companies began selling financial returns as their product and forgot the real customers who exchange money for products and services. Daily decisions are no longer driven by increasing customer value, but rather shareholder value. 
 
   Value-based engineering becomes focused on cost-reduction to improve margins rather than product features to improve customer satisfaction.  Cost of poor quality becomes a conversation about earnings lost rather than customers lost.  Lean material flow becomes about balance sheet improvements instead of customer lead-time improvements.  The business has become the classic model of "tailgate" inspection focused on managing to the earnings instead of using a process control model managing all the inputs to a satisfied customer. 
 
   Just imagine if we had customer meetings with the same focus, technology and intent of shareholder meetings.  Instead of the Annual Shareholder Report how about the Annual Customer Report discussing all the improvements in customer service and product quality?  So much of what we do is determined by how we see ourselves.  
 
   Are we in the business of selling goods and services or financial instruments?  Take stock and get organizational priorities straight and make your language match.  Trust that shareholders are best served by organizations that sell products and services to a growing base of revenue generating customers.

   Be well and keep adding value!
ASD&M News
 
EADS UAVThe following are news links relevant to quality, safety, and regulatory matters in the Aviation, Space, Defense and Maritime industries.  These are events which have been reported in the month of July 2009.  As a professional, it's your responsibility to remain relevant. 
 
Workforce
 
'Skills' camp sparks interest (CAN)
 
Skills CampStudents get hands-on experience at workshop designed to expose them to technical professions.
 
 
 
A major employer in Utah, Alliant Techsystems, told employees it is planning to lay off 450 people, or 10 percent of its Utah work force. The losses would be in addition to 300 workers who lost their jobs in March. 
 
 
Comlux LogoComlux Completion USA says it will invest $46.3 million to expand its two existing hangars at the former Indianapolis International Airport and construct a third for wide body aircraft. 
 
 
BAE SystemsBAE Systems is expanding its local operations by consolidating its three area facilities into one 74,000-square-foot building in North Charleston's Aviation Business Park, a move the company said is necessary to accommodate its growing electronics engineering program. 
 
 
P3 MaintenanceA dozen local groups encompassing public, private and nonprofit interests have banded together to battle what they see as Greenville County's most critical shortcoming - a work force lacking skills for jobs that would lift the community's collective income.
  
Regulatory and Safety
 
 
Federal regulators propose requiring modifications to the engines of some Boeing 777 jets to prevent ice from forming in fuel lines during long flights, a problem blamed for the crash of a British Airways plane last year. 
 
FAA publishes Advance Notice of Proposed Rulemaking on SMS (USA)
 
FAA Logo 2The Federal Aviation Administration has started laying the groundwork for a future Safety Mangement Systems (SMS) rulemaking that will affect everyone who provides aviation services or products under 14 CFR Parts 21, 119, 121, 125, 135, 141, 142, and 145.
 
 
GavelThe House Thursday night passed its version of the FY 2010 DOT/FAA spending bill - H.R. 3288. The measure proposes $3.515 billion for AIP and includes funding for a host of airport priorities, including ATC modernization.
 
 
NTSB LogoAt a meeting on a fatal subway crash near Boston, the NTSB announced that none of the federal agencies overseeing aviation, commercial driving, rail or maritime shipping have comprehensive programs to screen for sleep disorders. 
 
 
Canada LogoWhile food safety oversight clearly left a lot to be desired last summer - as detailed by the independent report on the listeriosis outbreak released this week - it is unsettling to realize that when the two regulatory systems are compared, oversight of the aviation industry is much weaker. 
 
Mexican AirlineThe Mexican government recently grounded their fourth airline since 2007. The airlines had performed insufficient maintenance checks, resulting in fluid leaks and other technical deficiencies. 
 
EASA LogoThe European Aviation Safety Agency (EASA) has published its Annual Safety Review for the year 2008. The number of fatal accidents involving aircraft registered in Member States of EASA * and performing commercial air transport operations remained at the level of 2007 (three). This number is one of the lowest in the decade and well below the average of six fatal accidents per year. 
 
NTSB HersmanDeborah A.P. Hersman was confirmed Friday as chairman of the National Transportation Safety Board. Hersman was nominated by President Barak Obama in June of this year. She has been a member of the Board since 2004, having been first nominated by then-President George W. Bush.
 
 
The European Aviation Security Agency (EASA) and 11 countries, including Azerbaijan, signed the Working Arrangement. First time this arrangement on behalf of Azerbaijan was signed by national airline AzAL on 6 December 2006. As ECAC's associated body Joint Aviation Authorities (JAA) was liquidated on 30 June 2009, the SCAA signed the Working Arrangement with EASA.
 
NTSB: Planes at increasing risk from large birds (USA)
 
A320 Hudson RiverThe National Transportation Safety Board voted to recommend the Federal Aviation Administration revise its current standards, which require airframes be able to withstand a collision with a 4-pound bird and that airplane tails be able to withstand an 8-pound bird. The recommendation didn't include engines.

Civil Aviation
 
 
Blocked by sanding trucks and a snowplow, a Russian cargo plane embroiled in a financial dispute sat grounded Friday by a restraining order in Michigan a week after it was flown out of northern Texas in violation of a similar mandate. 
 
 
787 noseNow in the midst of yet another delay with the Dreamliner program, Boeing's reputation is on the line.
 
 
 
European safety regulators have ordered Airbus A310 operators to check the type after at least three carriers suffered in-flight loss of wing fences.
 
 
Lexington KYIn a report on the on-demand Part 135 charter industry, the Department of Transportation Inspector General (IG) concluded that the "FAA does not effectively target inspections to higher-risk on-demand operators" nor provide enough inspector oversight of charter operators in comparison with Part 121 airlines. 
 
 
China's three largest airlines are likely to receive more government funds on top of huge amounts already doled out to help them weather the global downturn.
 
Boeing 787 supplier balks at brake-software redesign cost (USA)
 
A contractor on Boeing Co.'s (BA) delayed 787 aircraft program said new software for the plane's braking system has yet to be completed amid a disagreement over who should pay for the work.
 
Aeroflot sheds its Soviet legacy and turns to a western fleet (RUS)
 
Aeroflot A-318Aeroflot's symbol is still the winged hammer and sickle, but otherwise, the former communist carrier has mostly shrugged off its Soviet past. The strongest evidence yet: by the end of the year, it will fly a fleet nearly entirely made in the U.S.A. and Western Europe


Maritime
Air quality grant will help Foss repower two crew boats (USA)
 
A portion of a $4 million air quality grant awarded to the Port of Long Beach by the U.S. EPA will go to Foss Maritime Company to repower two crew boats in its Southern California fleet. 
 
 
Ship CargoFollowing some two years of legal wrangling, California air-quality regulators have begun enforcing emission rules on ships cruising the Golden State's coastline and harbors. 
 
 
The demand for mobile satellite services (MSS) in the maritime sector is expected to escalate due to crew welfare solutions, as users are beginning to expect Internet connectivity and access as the norm.
 
 
Defense 
 
 
The U.S. Senate on Thursday removed $439 million from the defense budget for a new fighter engine being developed in Evendale by GE Aviation.
 
 
Israeli RocketThe highly touted Arrow 2, which has been operational for about a decade, is considered a central element in Israel's defense against a nonconventional attack. Local defense analysts said the launch failure marked a developmental setback for the system, but added that Israel still has ample deterrence against an attack from Tehran.
 
 
Chief of Naval Staff, Admiral Noman Bashir said India's launch of a nuclear-powered submarine has affected the security balance in Arabia Sea, as the sea is highly vital for the entire world and Pakistan does not want anyone's hegemony on it. 
 
Military leaders and a major military contractor failed to protect a Green Beret who was electrocuted while showering in his barracks in Iraq, the Defense Department's Inspector General determined in a report.
 
Congress kills the F-22 (USA)
 
F-22 SnowCongress did what perhaps no plane in the sky could do: shoot down the F-22. The United States Senate launched a devastating surface-to-air missile at the world's most-expensive fighter program, voting to cut off funding for the F-22 Raptor, a decision championed by President Barack Obama.
 
 
UK TroupsThe National Audit Office said £155m of spending on radio systems used in Afghanistan could not be accounted for.
 
 
Ship WorkersIn the wake of two costly welding scandals at its Newport News shipyard, Northrop Grumman Corp. has tightened procedures and increased oversight on welders and shipfitters on the local waterfront.
 
 
China SubThe United States voiced concern about rising tension between China and Vietnam in the South China Sea as a senator led calls to boost US seapower faced with Beijing's growing military.
 
 
EADS UAVIn a test series comprising four flights, EADS Defence & Security (DS) has successfully tested the unmanned flight system (UAV - Unmanned Aerial Vehicle) 'Barracuda' at Goose Bay air force base in Canada.
 
 
Professor Wei Sha from Queen's School of Planning, Architecture and Civil Engineering has been testing how safe vehicles with titanium alloys are when attacked by bullets or explosions.


Space
 
NASA takes open source into space (USA)
 
NASA 2NASA conducts research and development in software and software technology as an essential response to the needs of NASA missions. Under the NASA Software Release policy, NASA has several options for the release of NASA developed software technologies. These options now include Open Source software release. This option is under the NASA Open Source Agreement "NOSA".
 
AS&D Events
The following is a listing of upcoming events relevant to the AS&D industry.
 
 
IAQG Meeting - Munich, Germany, October 13-16, 2009
 
 
CQSDI
 
Conference on Quality for the Space & Defense Industry will be held together at Cape Canaveral, in Florida (Save the date 3/15-16/2010) 
This newsletter is brought to you by The IPL Group, LLC.  We hope you find the content informative and useful.  If there are other features of this newsletter that you would like to see, let us know.  The power of our industry is not solely driven by mechanical means, it is our intellectual base which brings innovation and strength.
 
 
Sincerely,
 
Michael Dreikorn, Ed.D. 
President
The IPL Group, LLC