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19 th October 2011 Carlo K Nizam Presented by Carlo K Nizam (Airbus) Head of Value Chain Visibility and Auto-ID Airbus Executive Overview Value Chain Visibility & Auto-ID

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19th October 2011

Carlo K Nizam

Presented by

Carlo K Nizam (Airbus)Head of Value Chain Visibility and Auto-ID

Airbus Executive Overview

Value Chain Visibility & Auto-ID

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Carlo K Nizam Page 2

MACRO CHALLENGES

• 18 design/manufacturing/assembly sites across the world

• Exchange rate pressures

• New aircraft programmes (A380, A400M, A350, A320 NEO)

• Production rate increases

• Power 8+ programme, EBIT pressures

• Clear focus on enterprise eco-efficiency

Constant pressure for continuous improvement and innovation

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Carlo K Nizam Page 3

Why Increase Visibility? Why RFID?

Business Savings EBIT, Cash, Cost Avoidance

Visibility Information about working, not working

Measurability Where is it working, not working?

Improve the way of workingBusiness Process

RFID, Bar Codes etc. Accurate and efficient information

Quick winsthrough data automation

Long term winsthrough

continuous improvement

Improving visibility is a pre-requisite to improve the “way of working” and deliver business savings

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Carlo K Nizam Page 4

Visibility, Measurability and SavingsThey are all connected

All business savings come from improving a “way of working” i.e. process

Level of visibility and measurability determines level of process improvement

RFID can help improve level of visibility and measurability savings

Improved Accuracy Control Efficiency of Processes

Improved Business Savings

Manual based visibility with low measurability (e.g. manual data entry)

Semi-automated visibility with increased measurability (e.g. bar code)

Automated visibility with high level of measurability (e.g. RFID )

The level of visibility and measurability determines the level of savings possible; RFID is an promising enabler to increase this level of savings

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Carlo K Nizam Page 5

RFID + PROCESS MONITORINGEnables Process Improvement

RFID

Automation↑ Productivity

↑ Quality

↓ Cycle time

+

Real time reporting↑ Process Optimisation

↓ Identify Variations

↓ Automated Alerts

Process Monitoring

RESULT = Leaner and more competitive business processes

Set Alert parameters for process

steps

Set Alert parameters for process

steps

Monitor performanc

e against targets

Monitor performanc

e against targets

KPI trend and

prediction

KPI trend and

prediction

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Carlo K Nizam Page 6

Strategic BenefitsReal time visibility and automatic update of events across the value chainUnprecented high level of information accuracyMove to a digital “fly by wire” supply chain

Process BenefitsMore efficient automated processes shorter cycle times less inventoryIncreased accuracy & control of business operations less non conformitiesIncreased traceability of part life cycle less paper, less time lower costsMore automation Less manual intervention Improved labour productivity

Business BenefitsReduction in Inventory & Capital AssetsIncreased Labour Productivity and better avoidance of Costs

RESULT = Leaner and more competitive business processes

Supply Chain

• Real time delivery confirmation

• Global automated transport tracking

• Improved demand stability

• Increased visibility of inventory

Logistics/Distribution

• Automated data entry and tracking

• Faster processes, less inventory

• More accurate inventory, stockchecks

• Improved inventory management

Assembly

• Automated data entry

• More accurate & efficient configuration

• More accurate & efficient attestation

• Faster cycle times

Airlines/MROs/Suppliers

• Simplification of as flying configuration

• More efficient/effective lifecyle mgmt

• Faster repair turnaround process

• Automated ULD/baggage/catering tracking

Reduce productioncost of aircraft

Reduce productioncost of aircraft

Reduce operatingcost of aircraft

Reduce operatingcost of aircraft

BENEFITSIncreasing Visibility Through RFID

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Carlo K Nizam Page 7

CROSSROADS & DECISION TIMEThe situation pre-corporate programme

Collection of 15 independent projects

Fragmented approach; multiple standards, solutions and vendor landscape

Creation of multi-function Auto-ID Steering Committee

Company strategy, consolidation and prioritisation of activities

Agreement to develop a harmonised approach and solutions for deployment

Analysis of benefits, pilot proof points, bottom up business cases, industrialisation

Selection of standard solutions and services for Airbus/EADS

Clear pull from internal/external customers ONE Airbus approach : it works!

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Carlo K Nizam Page 8

Company approach to improve business processes through better visibilityScope is focused on big picture; Airbus value chain not functional silosRFID is seen as a key enabler to improve visibility & business processes

Airbus is taking an integrated and value chain approach for the potential application of Auto-ID across its business processes

Logistics & Distribution

Assembly LinesAirbus Suppliers Customer in Service

Transport Logistics Take Off

What is Value Chain Visibility and Auto-ID?

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The VCV ProgrammeThe Business Radar Concept

+ = AccurateStreamlined

Efficient operations

RFID + = AccurateStreamlined

Efficient operations

RFID = Airbus Business Radar

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The VCV ProgrammeTotal Lifecycle Visibility

Value Chain Visibility and Auto-ID Programme

Non-Flyable Flyable

Release 3Release 2Release 1

Logistic Distribution Manufacture Assembly Inservice lifecycle Cargo

Supply Chain Tracking(3PL Centre, Toulouse)

Warehouse Logistics(3PL Centre, Toulouse)

Inventory Management(A380 FAL, Toulouse)

Distribution Tracking(A380 FAL, Hamburg)

Global Transportation (Beluga, Hamburg Station)

Work In Progress (A380 Hamburg, St Nazaire, Broughton)

Config Mgmt + Attestation(LR FAL, Toulouse)

Tooling Management(A400M, Filton + SA Flowline, Broughton)

Cabin Configuration (Airline 1)

Payload Tracking(Airline 4)

Repair Shop Processes (Airline 2)

Spares Logistics/ FHS (Airline 3)

Each of these boxes is an RFID Process Lighthouse

The area in brackets is where the first lighthouse was deployed

A350 XWB : 3000 parts are being delivered with RFID that will enable these processes

The portfolio of RFID process “lighthouses” already deployed in multiple business areas can benefit all industry sectors

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Carlo K Nizam Page 11

DIFFERENT TYPES OF RFIDTotal Lifecycle Traceability

Value Chain Visibility and Auto-ID Programme

Non-Flyable Flyable

Release 3Release 2Release 1

Logistic Distribution Manufacture Assembly Lifecycle of parts Cargo

RFIDshipping

labels

RFID Containers

RFIDonjigs

RFID on partsRFID

ontools

RFID onassets

There is no one size fits all solution

Different RFID enablers are used for different processes

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Carlo K Nizam Page 12

DIFFERENT TYPES OF RFIDIntegrated into a standard corporate s/w platform

Value Chain Visibility and Auto-ID Programme

Non-Flyable Flyable

Release 3Release 2Release 1

Logistic Distribution Manufacture Assembly Lifecycle of parts Cargo

RFIDshipping

labels

RFID Containers

RFIDonjigs

RFID on partsRFID

ontools

RFID onassets

Device Interfacing & Data Event ProcessingDevice Interfacing & Data Event Processing

Business & Infrastructure Monitoring and ReportingBusiness & Infrastructure Monitoring and Reporting

Business Process Mapping & Legacy System IntegrationBusiness Process Mapping & Legacy System Integration

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Carlo K Nizam Page 13

RELEASE 1 (NON FLYABLE) A380 Final Assembly Line (FAL), Hamburg

Main Deck

Upper Deck

Lower Deck

Floor Deck

LiftFurnishing Hangar

RFID Reader (Identification points)

Each Dock has 11 Read Points (5 on the Left, Right and 1 centre). There are 6 docks in total on the A380 Final Assembly Line

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RELEASE 1 (NON FLYABLE)A380 Final Assembly Line (FAL), Hamburg

RFID Tag RFID Antennae

Motion SensorsRFID Reader

Error Light

Scope

750 Material Delivery Units (MDUs) containers per A380

Automated life cycle tracking of MDUs from 3PL to FAL

BENEFITS and STATUS TODAY

Streamline processes; right place, right time, first time

Reduce containers by 8% compared to manual process

Pilot Phase Over – Now in Production, 4500 containers

100+ RFID Reader InstallationsEXPANSION : A320 Final Assembly Line

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Carlo K Nizam Page 15

RELEASE 2 (NON FLYABLE)Tooling Management

BENEFITS

Automated tools booking in/out and workers association

Optimised maintenance and calibration cycles

No tools search time, less work stoppage

STATUS

Pilots – Completed

Industrialisation – Completed

EXPANSION : 65,000 Tools UK and Germany

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Carlo K Nizam Page 16

RELEASE 2 (NON FLYABLE)Tooling Management

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Real-time localisationLocalising a Business Item

LAST SAP UPDATE 20/01/2011 17h15

POSITION DESIGNATION

+

CORDON MÉTALLIQUE*

3121 

3120 Cordon métallique couteau court

Cordon métallique couteau longP30Y_L79_SOU

P40B_G30_SOL

3121

3120

P30X P30YP47 / P59

P40B

P40A

M55

P50A

P

50B

M50

EQT NB

Business ItemSort by Item shadowed Maintenance status

BENEFITS

Automated tools booking in/out

No tools search time, less work stoppage

Automated logistics tracking

STATUS

Pilots – Completed

Industrialisation – EIS April 2012

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RELEASE 2 (NON FLYABLE)Configuration Management

Business and Economy Class Seats and Life Vests

Tagging

Seats

LifeVests

Seats

Locations Tagging

LifeVests

BENEFITS

Automated and Digital Attestation Process

Faster Cycle Time and Reduced Paperwork

Improved Configuration Management

STATUS

Pilot - Completed

Industrialisation – Completed

EXPANSION : A320 and A380 Final Assembly Lines

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Carlo K Nizam Page 18

RELEASE 2 (NON FLYABLE)Visibility of Industrial Processes (VIP)

Green dots are the tools moving in 3D and in real-time with accuracy of 15cm

Wing Assembly Centre

BENEFITS

Automatic and real-time visibility of industrial processes

Automatic monitoring of processes and variations

Key enabler for Lean Improvements

STATUS

Pilot - Completed

Project - Completed

EXPANSION : All A380 Assembly Sites

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RELEASE 2 (NON FLYABLE)Visibility of Industrial Processes (VIP)

EXPANSION : All A380 Assembly Sites

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Carlo K Nizam Page 20

RELEASE 3 (FLYABLE)Current Status

Use Case Studies4 opportunity studies completed with airline customers and MRO partners All payback within 12 months, strong savings (up to multi-million €/year)

A350 XWB RFID Part Marking Specifications Distributed to Airbus suppliers in 2008, based on approved standardsSuppliers deploying RFID solutions for part marking

Aerospace RFID Standards FinalisedATA Spec 2000 for data structure and high memory managementSAE AS5678 for performance minima, test conditions and robustness

The introduction of RFID part marking on A350 XWB will help enable customers reduce their maintenance costs

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Carlo K Nizam Page 21

NEXT STEPSEADS and Beyond…

EADS Parent GroupExpansion across multiple business units within EADS Group Projects re-using Airbus processes, solutions, contracts and vendorsRe-use of standards : Faster, cheaper and better

Airlines, MROs and External Organisations Airbus : catalogue of benchmark RFID processes across aircraft lifecycleNot limited to Airbus; generic and applicable to all players in the industryApproached by number of companies to develop and deploy projectsTwo projects already completed, three more in progress

Airbus catalogue of standard processes and solutions is providing value to multiple actors across the value chain

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Carlo K Nizam Page 22

EXAMPLES of EADS BU Projects

All projects re-use Airbus processes/solutions/contracts/vendors

Process Airbus Eurocopter Astrium Cass

Warehouse Logistics X X X XAsset Tracking X X XTransport Tracking X XTooling Management X X XWIP Tracking X XIndustrial Vehicle Management XForeign Object Damage (FoD) X XConfiguration Management X XMaintenance and Repair X XExternal Services X X X

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Carlo K Nizam Page 23

Summary

Airbus recognises RFID as a key enabler for improving processes

Airbus is taking an integrated & end to end approach to the use of RFID across all business processes through a single corporate programme

Airbus is actively working with airline, supply chain and industrial partners to develop an approach that maximises benefits to all actors

Airbus is working with major industry players, standards bodies and authorities to ensure inter-operable RFID solutions

Airbus is using RFID as a BUSINESS RADAR to help build a DIGITALand FLY BY WIRE view of the supply chain and its business operations

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Carlo K Nizam Page 24

© AIRBUS S.A.S. All rights reserved. Confidential and proprietary document.

This document and all information contained herein is the sole property of AIRBUS S.A.S.. No intellectual property rights are granted by the delivery of this document or the disclosure of its content. This document shall not be reproduced or disclosed to a third party without the express written consent of AIRBUS S.A.S. This document and its content shall not be used for any purpose other than that for which it is supplied.

The statements made herein do not constitute an offer. They are based on the mentioned assumptions and are expressed in good faith. Where the supporting grounds for these statements are not shown, AIRBUS S.A.S. will be pleased to explain the basis thereof.

AIRBUS, its logo, A300, A310, A318, A319, A320, A321, A330, A340, A350, A380, A400M are registered trademarks.