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DATA MANAGEMENT CHALLENGES of AEROSPACE & DEFENSE ` A WHITE PAPER TPT Technologies, 3960 Howard Hughes Parkway, Suite 500, Las Vegas, NV 89169 www.CMstat.com
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DATA MANAGEMENT CHALLENGES - CMstat€¦ · Data Management Challenges of Aerospace & Defense - A CMstat White Paper 9. With contract details determined the engineering process begins

Oct 18, 2020

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Page 1: DATA MANAGEMENT CHALLENGES - CMstat€¦ · Data Management Challenges of Aerospace & Defense - A CMstat White Paper 9. With contract details determined the engineering process begins

DATA MANAGEMENT CHALLENGESof

AEROSPACE & DEFENSE

`

A WHITE PAPER

T P T Te c h n o l o g i e s , 3 9 6 0 H o w a r d H u g h e s P a r k w a y, S u i t e 5 0 0 , L a s Ve g a s , N V 8 9 1 6 9

w w w. C M s t a t . c o m

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Executive Summary

The Data Management and Contract Management organizations of Aerospace and De-fense contractors are the conduit to the customer and it is their work that allows for de-livery, submittal, acceptance and payment from the customer. Without these organiza-tions there would be no business and no profit. Seasoned Aerospace and Defense con-tractors know that these teams are critical to their success.

Strategic Aerospace and Defense contractors who understand Contract and Data Man-agement are looking for alternatives to exponential head-count growth, methods to re-duce inefficiencies, and solutions that look beyond the short term benefit and create long-term benefit to the firm and its clients. This white paper explores the multi-faceted challenges and provides guidance on how to move your Contract Management and Data Management functions from a necessity to your strategic advantage.

Key Observations & Findings

The following describes the inefficiencies and profitability challenges common across Aerospace and Defense contractors, sub-contractors and their customers. Although these findings address many different organizations within a contracting firm, the focus of this analysis is on the Program Management, Data Management, and Contract Man-agement organizations within Aerospace and Defense.

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• 80% of organizations lack a cohesive system to track, audit, or manage the data associated with contract and data management.

• Most firms use manually-intense procedures and disparate systems to or-chestrate data management, contract management, and submittals and re-ceipts.

• Team members, departments, sub-contractors and customers must each create their own record of information to manage the process of change management, data management, program management and contract man-agement. These records often are not properly synchronized.

• A majority of firms when faced with data management and contract man-agement challenges resort to increased man hours to solve their challenges.

• Most firms spend many unproductive hours to locate, gain consensus, dis-tribute and communicate information required for the submittal process.

• Despite increased effort on the part of all parties involved, project dates slip.

• Most firms are challenged to consistently and appropriately secure their data to ensure that they protect intellectual property as well as meeting the ITAR requirements of Homeland Security.

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Implications

The implications of these findings and observations are clear. As a result of the broad community of individuals involved and the multiple uses of the data that is managed, the effect of these challenges ripples into many areas with wide-sweeping impact. Some of the most concerning results are:

• Aerospace and Defense contractors cannot quickly respond to information requests from customers since data is not easily located or verified, result-ing in poor customer relations, increased costs, and loss of additional reve-nue.

• Team members, departments, sub-contractors and customers create their own record of information, which is manually-intense, error-prone and is likely to become quickly outdated. Incorrect data can result in late pay-ments or penalties and reduced customer confidence based on contract terms, which reduces a firm’s opportunity for profitability.

• Program Management costs for labor increase with complexity of the pro-ject and number of interested parties, rapidly eroding profitability.

• Engineering, Contract Management, and Change Management teams are distracted from daily tasks to respond to information verifications and re-quests resulting in opportunity and productivity losses. However, the in-vestment is necessary since incorrect data can slow acceptance of submit-tals and therefore, revenue recognition.

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• Program and Data Managers spend inordinate amounts of time coordinat-ing meetings and e-mails just to create and distribute accurate data. This results in project schedule delays, reducing customer confidence and satis-faction, increasing penalties, and ultimately eroding contractor profitabil-ity.

• Administration of data security and disparate systems results in increased risk, reduced visibility of IP, higher IT costs for system maintenance, user training, data security, and platform support.

• Improperly secured data may be available for misuse in ways that will di-minish the value of a firm’s intellectual property thus resulting in a loss of a competitive advantage in the market.

• Data of national security importance may be available for pilfering or mis-use if not properly secured based on a person’s role or background. This is not just about being cautious. These are standards set in new legislation under Homeland Security known as International Traffic in Arms Regula-tions (ITAR). Compliance is not only mandatory but failing to comply may constitute a national security breach, possible legal implications, and a cer-tain end to future contract opportunities.

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Recommendations

There will always be opportunities to improve the Program, Data and Contract Man-agement functions. Successful Aerospace and Defense contractors seeking best-in-class performance will pursue initiatives and solutions enumerated below:

• Reduce the number of technologies utilized across the process and func-tions to lower the cost of information technology and increase the strength of security across the enterprise.

• Organize and/or eliminate disparate systems used to conceive, build, and deliver by enabling full-featured technologies to support the data man-agement process.

• Create a single source of the truth for every department, sub-contractor, role or customer.

• Create online workspaces that allow for anytime access to data for collabo-ration and review.

• Reduce excessive communications and meetings by applying practices and solutions that mange versioning and approval within the process.Reduce handoffs, and improve change management across all departments.

• Reduce the effort required to compile, validate, distribute, submit and re-ceive deliverables by automating manually-intense processes based on Standards and Best Practices.

• Eliminate tedious daily activities and focus team members on common goals by managing, not only individual activities, but the contract/project milestones within your solutions.

• Reduce support costs and speed return on investment by deploying proven full-featured solutions. Avoid service-based, solutions that rarely deliver similar features, implement on time or within the proposed budget.

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Introduction

Aerospace and Defense contractors produce some of the most complex and engineer-ing- intensive products and services available. These products & services created under contractual agreement with government agencies, military or other contractors require firms to follow equally complex and manually-intense processes to deliver and get paid for their offerings.

In most cases this process requires many man-hours, disparate tools, and heroic coordi-native efforts. In the quest for accurate submittals and payment for deliverables it is not uncommon for these efforts to interfere with the business of delivering exceptional products and services. Achieving balance between the goals of managing contract and data compliance, engineering great products, and being profitable is the challenge of program, contract, and data managers.

The same challenges that plague the aerospace and defense contractor often trouble the customer or government agency as well. The data that is compiled by the contracting firms for submission must be reviewed, stored and maintained by the customer. Con-tract terms need to be managed and reviewed prior to a receipt approval and payment to the contractor. So as we discuss the complexity of program, contract and data man-agement we are speaking of the same roles and challenges for both the contractor and customer.

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The focus of this white paper is to:

• Define the data management process for aerospace and defense firms and their customers.

• Expose the current challenges of data management for data managers, contract managers, and program managers for aerospace and defense firms and their cus-tomer’s contract managers, program managers, and data managers.

• Understand emerging best practices, standards and opportunities for improve-ment within the data management process.

• Provide considerations when looking to solutions and approaches to address the challenges of data management in aerospace and defense firms and in the data management functions of their customers.

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The Data Management Process

To understand the challenges of data management we must define and understand the key steps in the business process and identify the handoffs, the purpose, and the driver of each activity in the business process. The data management process impacts almost every member of the aerospace and defense contracting firm as well as members of the customer’s data management, contract management and program management team. The data management process spans the Product Lifecycle from concept, to contract terms, to delivery, and in many cases through Sustainment and retirement.

Aerospace and Defense is based on innovation and from the moment the customer or the contractor conceives an idea there is a need for gathering data related to the con-cept. This data could include items such as requirements, budget numbers, or techni-cal constraints. These items will eventually turn into the guidelines that will drive a contract between customers, contractor and subcontractors. Contract terms are drafted and are crafted to meet the needs of both the customer and the contractor. The con-tract negotiation process begins the need for version management and document stor-age.

A contract contains terms, milestones, and specifications for delivery as well as product requirements for the product or service to be delivered. The contract forms the corner-stone of the data management process. It is these terms that the program manager, data manager and the customer will use to manage the process of submittal, receipt and payment for the project.

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With contract details determined the engineering process begins on the deliverable. At this point the community of individuals who impact the deliverable, create data regard-ing the deliverable, or need to be aware of information regarding the deliverable, grows exponentially. These interested parties include program managers, engineers, manufac-turing, change mangers, data managers, contract managers, testing teams, sub-contractors, compliance managers, documentation specialists, training development, firm management, purchasing, project managers, finance, as well as the customer fi-nance teams and their program, and contract managers. With a community of roles this large and with numerous individuals in each role it is very clear how expansive the reach of data management can becomes.

As a product is developed decisions regarding the deliver-able are made. Regardless of the size of a decision all changes, revisions and refinements are captured for the purpose of delivering the product. Many data elements are important to a broader group than the contractor and the customer. While those elements need to be available for numerous reasons, they should not be difficult to obtain regardless of location or time zone. Some elements are con-sidered proprietary and should be protected to maintain intel-lectual property or national security. More importantly, many of these data sources must be verified as accurate. When verified, the data can be delivered to the customer or returned to the contractor as defined in the contract.

Through the years the methods and types of contract data to be shared between cus-tomer and contractor have become standardized. The key elements managed are the Contract Data Requirements List (CDRL) and the Subcontract Data Requirements List (SDRL). These are the key components managed by the program management and data management team. The source of data for CDRLs and SDRLs are numerous and can span multiple organizations, roles and many disparate systems of record.

The source of data for

CDRLs and SDRLs are nu-

merous and can span

multiple organizations,

roles and many disparate

systems of record.

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The data manager and the program manager typically use a project plan with mile-stones that allow them to organize the data at key points in the project where they will gather the data from the various sources, and format it to satisfy a CDRL or SDRL. Those data elements are delivered to the customer.

Typically, the customer will take the CDRL or SDRL and use those as inputs in their own data management process. Understanding that there may be several revisions be-fore the contractor and the customer agree that the submittal is complete the customer would want to monitor the changes, revisions, and correspondence. Therefore, revi-sions or access to the versions of the data should be available to both the customer and contractor. As the data manage-ment teams in both organizations utilize or review the data it is not uncommon for errors to be identified. If errors are identified then impact, action plans, project plan revisions, and changes may be required in both the customer or con-tractor organizations. The ability to respond to these situa-tions is both critical to the quality of the deliverable and the reputation of the contractor. In extreme cases a customer may choose to fine or penalize a contractor, which could greatly impact profitability. This simple fact alone shows why data management requires strong discipline, process and focus to be successful for either the customer or contractor.

Once the contractor and the customer have reached final agreement on the contents of CDRLs and SDRLs the customer issues an authorization for payment. Payment is typi-cally for work completed to date and not for the entire contract value. Since payment is tied to the data management process it is no surprise there is great importance and scru-tiny on the efficiency and effectiveness of the data management team.

Since payment is

tied to the data management

process it is no surprise

there is great importance

and scrutiny on the

efficiency and effectiveness

of the data management

team.

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Data Management Challenges

And Best Practice Recommendations

Despite the desire for efficient and effective data manage-ment processes the complexity of the task has prevented organizations from making great strides. To date solutions and practices have eased a particular step or activity but have not addressed the entire process. Despite innovation there have not been great leaps in solving the overall proc-ess challenges for customers and contractors. Most aero-space and defense contractors have typically solved the challenges not via automation, standards, or best practices but instead via excessive communication, dedicated data man-agers and excessive man-hour costs.

Most A&D contractors have

typically solved the

challenges via excessive

communication, dedicated

data managers and

excessive man-hour costs

Understanding how complicated the process of data management and contract man-agement is it may surprise you that over 80% of organizations lack a cohesive system to track, audit or manage the data associated with data and contract management. How-ever almost every contractor utilizes several different point solutions to manage the numerous data elements and processes that compose the data management and project management process. Those tools span the processes of communication, project man-

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agement, contract management, document management, computer aided design, version control, billing and elec-tronic meeting places.

It is unlikely that program managers and data managers have a strong command of all the tools used within their contracting environment yet to compile the data required for CDRLs and SDRLs they must gain competencies in al-most all of the tools.

It also means that for every member of the data management and program management team that the firm must also purchase necessary hardware and application licenses. This means large investments in technology, training and em-ployee salaries for occasional users of these technologies.

At first blush it may seem logical to suggest that a single application or solution should be created to manage contracts, create communications, perform computer-aided de-sign, facilitate collaboration, prototype designs and perform project management, track revisions, and approve data. In reality there are best-of-breed, fully-featured applica-tions (PLM solutions) for aerospace and defense that focus on and handle the Engineer-ing functions quite well. There is no need to replicate these offerings. However, there is a need to create an integrated “backbone” to support Data Management. The single technology “backbone” works in concert with the best-in-class applications to manage the key milestones of the project, as well as the outputs and files required for that mile-stone. It should facilitate storage and automate scheduling tasks as well as validating data for use by the Data Managers. This is the simplest and most effective way to ex-pand functionality while leveraging your PLM investment.

Data managers expend large amounts of time reviewing data to determine and validate its timeliness, accuracy and validity. Locating the data items such as reports, internal and external correspondence, e-mails, contract amendments, requirements, supplier de-liverables, invoices, meeting notes, engineering specifications and drawings, training and documentation is also a massive task. Locating data is difficult because this data is

Understanding how

complicated the process of

data & contract manage is it

may surprise you to know

that over 80% of

organizations lack a

cohesive system.

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stored in numerous formats, in multiple locations, and multiple versions. It is stored in numerous locations because for various reasons, it must be shared across different functions at different times. Since, in many cases there is no common “backbone” for management of the version of the file, or the hand-off of the data to other functions, data quickly becomes inaccurate and uncontrollable. Add the further complication of determining which location holds the correct version and if the data has changed in the compilation period and the challenge continues to grow.

In short, this means that without a “master record” of the data item, and a “backbone” to manage where data is being used, updated and stored; your organization runs a high risk of many functions working with outdated or incorrect information. Incorrect information yields only two results for an aerospace or defense contractor: rework and non-compliance. Rework before a deliverable can be submitted means delays, possible penalties or potential revenue loss. Non-compliance can mean any number of things, all generally negative. The result is erosion of an organization’s resources or profitability. To avoid these unfortunate situations a data or program man-ager must:

• Locate the correct information.

• Determine and locate the correct version of data.

• Archive or Categorize the incorrect information to avoid further issues.

• Locate all interested parties.

• Communicate the correct information.

• Determine the impact of decisions made or work completed with incorrect data.

• Re-plan & Re-execute activities that need to be repeated due to the incorrect data.

• Notify customers of delays or management of cost overruns.

Without backbone to

manage data,

your organization runs a

high risk of many functions

working with outdated or

incorrect information.

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These may seem like a few simple steps but each of them can becomes enormous de-pending on the size of the project. These steps are made larger and more complex de-pending on how information is stored, communicated, and validated. With every new method of data storage or communication, individual data elements experience a “hand-off”. Each data hand-off increases the potential for miscommunication or missed changes that occur during the hand-off process. The potential for processing “invalid” data increases exponentially with the number of disparate data applications and storage methods. Therefore, it is no surprise recent research identified that best- in- class aero-space and defense contractors have determined that their number one issue is improving hand-offs.

Aerospace and government contractors, and their custom-ers may look to improve handoffs in the Data Management process by addressing several focus areas:

Formalize the Process - Improving handoffs means there is a formal process to move information from one group to another at appropriate times. Currently the method that most firms utilize to gain consensus or validate data is to or-ganize large numbers of meetings and communications. Meetings and communications present unique challenges, including getting the right people, with the right under-standing, in the same room, at the same time. And even if they could participate, and know the information, most will still need to gather further information to fully validate the data. Even with a coordinated effort across organizations this process is repeated numerous times to gain consensus. The composition of communications and organiza-tion of meetings alone requires many non-productive man-hours. While it is worth it to get the correct data, this is not an efficient way of doing business.

Start Early - Tools such as paper documents and e-mails are used to communicate but the data files are not managed and controlled by a “single source.” Lacking a single source, each time a person requires the most up- to-date information they must locate the correct data, determine the valid source and gain approval. Since they may do this

Incorrect information yields

only two results:

Rework and

Non-Compliance

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numerous times in the life-cycle of a project the biggest question may be when is the right time to perform these activities? When should you begin the process of storing data, conducting reviews, and communicating information? The answer is before you start your project. That means utilizing tools to manage your project and use those key project milestones to manage the process of Data Manage-ment. Build into your project plan the opportunities to validate data, gain consensus and assemble your docu-ments.

To the degree that you can use that same process to manage the data you will greatly reduce the effort required to man-age your data.

Implement a Data Management “Backbone” - Successful organizations use methodologies to address these challenges by creating tools to track changes, notify interested parties of revisions, and provide feedback. These activities are integrated with collaboration spaces, and tools, to sup-port electronic capture of meeting minutes and provide an archival record of what deci-sions were made, who made them and how they were made.

There is a need in the aerospace and defense contracting arena for a single application to perform these tasks and store data elements. Data elements are as diverse as internal and external correspondence, contract amendments, requirements, supplier deliver-ables, invoices, meeting notes, engineering specifications and drawings, training and documentation. The elements are stored in numerous formats, locations and files. These items are often created in best-in-class (Enterprise PLM) applications. It would be un-wise to lose the rich features of a best-in-class application, so when looking to organize data and reduce handoffs, organizations should utilize an information “backbone” to secure the storage of the files and mange the versioning. Because an information “backbone” works in concert with the best- in-class application it enables the best of both worlds. Your organization benefits from the best-in-class application features,

Most firms utilize large

numbers of meetings and

uncontrolled

communications to gain

consensus and/or validate

information

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while seamlessly protecting, versioning, revising and gaining consensus via the data management “backbone” application.

If your data management “backbone” is aware of the source application and its unique file type, contents, and display requirements, it can greatly reduce IT costs in several ways. If you do not need the source application to view the files you greatly reduce the number of licenses, or concur-rent licenses, a firm needs to purchase. It also reduces the number of hardware platforms and unique configurations to be maintained by IT support teams. Creating a single interface to view data and source files greatly reduces user training and support costs. Users do not need to be trained on the unique navigation and features of each source application and quickly gain pro-ficiency across the entire process.

Besides organizing the data there is the multi-faceted challenge of securing the data. Data should be secured to achieve three goals:

• Maintain IP -The first goal is to prevent those individuals not having a valid busi-ness reason from seeing the data. This is to avoid situations where your firm’s intellectual property is unknowingly exposed for pilfering.

• Maintain Data Integrity - The second goal is to secure your data from unauthor-ized changes or modifications. Only those individuals within your firm with a valid business purpose to make changes to a file are permitted to do so while still allowing you to share data with your team. This allows you to enable informa-tion sharing without propagating copies by using one source for communication.

To organize data and reduce

hand-offs,

a data management back-

bone should be utilized

to secure and version the

storage of the files

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• Comply with Government Regulations -The third and final reason for securing data is to meet the standards for aerospace and defense contractors as outlined in the International Traffic in Arms Regulations (ITAR). This Homeland Security ini-tiative mandates contractors to secure certain data from individuals based on their country of origin. This can be challenging since this type of security is not about the person’s job, location, or other common attribute. This is about an indi-vidual. That means that in many cases that you must go to extreme efforts to configure unique security for these individuals.

Data delivery restrictions are also of key importance. Ensuring that data is not deliv-ered to ITAR restricted users is crucial. The biggest challenge in security is the effort re-quired by members of the data management team or I.T. or-ganization to achieve this level of complex security for the firm. To understand the magnitude of this challenge, sim-ply take the number of employees your firm employs, mul-tiply that by the number of hardware platforms, applica-tions utilized, number of unique roles, by the number of locations and daily changes that occur to roles and plat-forms, and you can begin to understand the complexity of this task. Now, add to that the number of ITAR roles in your firm and the effort continues to mount. Recent discus-sions with aerospace and defense contractors have shown that in some cases as many as two full-time persons may be tasked just to manage the security!

If you’re not adopting a tool

to manage your process then

you’re not going to be

competitive in the

aerospace and defense

arena

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Solution Considerations

Clearly there is an opportunity for efficiencies and improvement, and automated solu-tions to solve the challenges we have discussed. As in all technology solutions there are attributes and features those in the aerospace and defense industry should consider when selecting solutions to automate their data management functions. There are also key focus areas that assist in picking world-class applications that will result in fast re-turn on investment. The key focus areas can be organized into three themes. They are:

One ProcessOne Source

Proven Success

One Process

Instead of heroic efforts to organize meetings, communications, and manage deadlines, a Data Management “backbone” creates One Process for your project. One Process means you’re always in touch with your project team members and your customer. One Process means you’re time and money is spent on building the best products in-stead of chasing paper. According to recent research over 60% of the best-in-class or-ganizations use a tool to automate Data Management processes.

If you’re not adopting a tool to manage your process then you’re not going to be com-petitive in the aerospace and defense arena. When reviewing solutions look for these features:

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• A solution that can manage from conception to retirement. This reduces the need to move from application-to-application and group-to-group to get work done, which increases your speed and accuracy.

• Applications that not only manage data but integrate with project management, and PLM tools to manage the data, deliverables and project information.

• Tools that not only automate your end-to-end process but also use metaphors such as wizards to streamline the clerically intense tasks such as the submittal process. These tools increase accuracy and reduce man-hours.

Simply put One Process means you build an efficient organization.

One Source

Instead of seeking out a source of the truth every time you have an information request make sure you have One Source for all data all the time. One Source means that your solution manages the validity, distribution, revisions, and status of all data from the moment it is created until it is retired. By knowing which data is correct you focus your efforts on improving product instead of defining the correct product attributes. When looking to solutions that create One Source consider the following features:

• Full featured information “backbone” for organizing, securing, versioning, and validation, spanning numerous platforms, applications, and physical locations, thus reducing confusion and errors.

• Data is accurately managed to allow Auditability, Traceability, Verification, and Reuse, ensuring you’re working with accurate data.

• Data integrated into status and management reporting means your customers are always informed.

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• Data should be available anytime, anywhere. Data Management “backbone” must be accessible via the internet to deliver the right data to the right person whether they are a customer, sub-contractor or employee, regardless of location.

• Collaboration and workspace tools are integrated into the solution to allow for update and review at all times ensuring correct data.

• Solutions that allow for viewing of data without the need for purchasing extra li-censes of the source application, reducing infrastructure costs.

• Solutions that reduce your IT costs by providing role-based security across dispa-rate application files instead of applying security within each application, which is costly, time consuming and inconsistent.

• Solutions that meet the ANSI/EIA 859 standard, making your organization com-pliant and up-to-date with best practices.

• Deliver pre-configured reports and reporting tools, for communicating status. Status reporting means you’re always informed and deliver on time.

One Source means you are Confident and Compliant

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Proven Success

There are lots of opportunities and point solutions that can impact your business. But not all of those companies provide a complete solution that not only meets your needs, but also have a history of making their customers successful. When reviewing solu-tions, aerospace and defense contractors should look for the following attributes:

• Built by seasoned data managers, program managers, and engineers for their peers. This means the people who built the application know how the key users of the system work which makes usage easier and more efficient.

• A product tailored for the aerospace and defense industry that includes standards and best practices when it is delivered instead of requiring you to customize the solution to meet your industry needs.

• Look for a packaged software solution not a service-based solution. Service-based solutions typically run over budget, have high support costs, and rarely de-liver a rapid return on investment.

• Strong customer programs and implementation methodologies that provide you a rapid return on investment.

Going with Proven Success means you are Profitable.

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Conclusion

While the problems of Aerospace and Defense contractors may be common, the solu-tions that can meet these requirements are not.

As your Program Management, Contract Management and Data Management teams strive to find solutions to your Data Management challenges, look to the leader in Aero-space and Defense contracting Change Management and Data Management solutions, CMstat. CMstat has over 20 years experience in delivering Change Management and Data Management solutions. With hundreds of customer successes and exceptional products like Epoch DM, our web-based premier solution for automating the data man-agement process CMstat is more than qualified to provide your firm with a solution to the challenges outlined in this white paper.

For more information or a product demonstration of Epoch DM or other CMstat solu-tions please contact us at 877-537-1959 or via the internet at [email protected]

One Process, One Source, Proven Success

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