We have entered the competition
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This is a translation of the original article in Russian

The Sukhoi Superjet 100 aircraft is a challenging project by definition. For the first time in more than 20 years, a new type of a civil aircraft has been designed in Russia – an aircraft whose technological level is comparable to that of leading civil aircraft manufacturers, and which therefore underlines Russia’s wish to re-join that club of leading manufacturers. In contrast to most of their competitors, however, the SSJ creators not only had to design the product as such, but also create the entire necessary infrastructure. At the same time, they had to change themselves and within a short period of time implement a modernisation process in all fields, from design technologies to post-sale support and sale financing mechanisms.

Currently, the airplane manufacturer JSC ‘Sukhoi Civil Aircraft’ is taking the next step, moving from test production to middle-scaled serial production. The company plans to produce 26 SSJ-100 this year, compared to 12 last year and 5 in 2011. Simultaneously, the company is implementing further aircraft improvement and production optimization measures.

‘Umpro.ru’ spoke to Andrey Kalinovskiy, president of JSC ‘SCA’.

Andrey Vladimirovich, in recent publications dedicated to the SSJ some top managers of your company and the UAC management indicated that the Superjet is just an initial platform. Could you please explain what that means? Is the SSJ a basis for a whole series of civil aircraft by Sukhoi?

Among other things, yes. As you know, this summer we have successfully concluded the testing programme for the SSJ-100 Long Range modification. It has a range of 4,500 km, which is one and a half times longer than the basic version. We also plan to produce another SSJ-based aircraft.

However, the term ‘initial platform’ has another, broader meaning: the Superjet project kicked off the process of deep modernisation of our production facilities, united the efforts of the SCA staff in Moscow, Komsomolsk and Novosibirsk, and adopted the best Russian and foreign technologies for the needs of civil aviation. Our airplane was designed in broad international co-operation; many of the installed systems were created for the first time specifically for the Sukhoi Superjet 100 and underwent all necessary certification.

By the way, what is the exact share of Russian manufacturers and foreign suppliers in the SSJ project?

The fuselage is made completely in Russia, and most composites also are Russian. A considerable part of other components are supplied by Russian companies. However, a wide spectrum of components is supplied by foreign partners, such as the avionics and the landing gear. The engines were designed and are produced by a Russian-French joint venture PowerJet, while the engine components are supplied by another joint venture – ZAO ‘VolgAero’…

The main assembly line is located in Komsomolsk-on-Amur, where we build ‘green planes’ with the best possible productivity – these are basic frames without livery and cabin interior, suitable for any customer. Every customer has its own requirements: in one country, for instance, the local aviation authority requires the installation of a video camera in the cockpit. This and all other options are installed in our customization centres in Ulyanovsk, Zhukovsky and Venice. Once we have gained a foothold in the South-East Asia, we may set up another customization centre in the Russian Far East – such a project already exists. We have an increasing amount of options – we offer our customers various cabin designs and additional services. In Venice, for example, we install a cabin interior designed in Italy, – we presented that interior at the Le Bourget air show — paint the aircraft and deliver it to our Mexican customer. Their planes have a single-class and yet very comfortable cabin layout: comfortable seats, generous seat pitch, built-in monitors displaying flight information and entertainment programmes, etc. Thus, despite the fact that this is regional airplane, its comfort level is very close to that of a medium-range aircraft.

But don’t those logistic circumstances make the plane excessively expensive? The engines are shipped from Rybinsk to Komsomolsk, and then the 'green plane' is transferred to Venice for customization…

The concept of production co-operation is not new. Let me mention the example of our foreign colleagues: Boeing moved the production of the fuselage mid-section to Japan, elevators to China, while the nose section is produced in the US, the landing gear in England, and the horizontal stabilizer in Italy. All calculations prove the economic profitability of this logistics concept. An aircraft generally is an expensive product, as it incorporates brand new technological innovations in the aviation industry. But our plane is not more expensive than those of our competitors. Besides, one must understand that the price of an aircraft is just one component of its competitiveness. One can produce a relatively cheap airplane, but its spare parts are very expensive. Or its operational costs turn out to be very high. Fuel consumption also is an important factor. Sometimes a relatively cheap airplane has high fuel consumption. Finally, an aircraft deal is not only about the price. It also includes a financing model as well as leasing credit conditions. Today, we offer various financial models, which involve among others Vnesheconombank and the leasing company Ilyushin Finance, and we look out for new financial partners capable of offering a variety of financing models in order to acquire new customers. In short, when talking about the price of an aircraft, one has to see the entire picture.

In early summer the Minpromtorg (Ministry of Industry and Trade of the Russian Federation) prepared a government regulation bill on amendments to the federal development and financing programme called ‘The development of civil aircraft in Russia for the years 2002 to 2010 and for the time period until 2025’. This document stipulates additional R&D financing of the SSJ-100 project amounting to RUB 3.3bn until 2015, with RUB 1.6bn to be made available this year already. How is this money going to be spent exactly?

The money is going to be spent on further improvement of flight performance, technical characteristics and operational results of the aircraft. This programme also includes a better flight control system for the pilots, better access to the particular components for service technicians, and other improvements to lower the operational costs of the aircraft. Altogether, we are talking about enhancing the set of competitive advantages necessary for further development.
For instance, we have increased the service life of some components thanks to close co-operation with the suppliers, additional tests, improved design etc. As a result, we were able to omit one of the regular checks, which simplified the operational service of the aircraft. We also dedicate a lot of time to finding ways to reduce the weight of the aircraft. A solution in this field will reduce fuel consumption and increase the operational characteristics of the aircraft.

We are also implementing a set of measures to amplify operational restrictions. Currently we can cover up to 80% of customer requirements, and our plan for the future is to offer a package of all conceivable functions, which will take into account even extremely rare and specific requirements. For instance, a customer may need to operate the aircraft at a temperature of 50°C. Or place a very special order for airplanes able to land in high mountain regions – at 3,000 m above sea level.

Talking about customers: how is the sales process of the SSJ organized?

It is a very complicated matter. We have a department to promote the airplane, organize presentations and our participation in exhibitions, as well as analyses of service routes. We also use the sales experience of our Italian partners and actively work with consultants, who help us to set up business processes based on international experience in the aviation industry, including the selling process.

Today, a successful promotion of an aircraft requires a network of post-sale service centres…

It is about to be created: we signed a general agreement with the joint venture SuperJet International (SJI), who is setting up such centres around the world.

And what is the ratio of inner-Russian and foreign orders for the SSJ-100?

Currently, the inner-Russian orders make up for some 60% of the overall portfolio. The need for our planes in Russia is very high, as many civil aircraft designed in the Soviet Union are no longer in production, and this niche needs to be filled. The Russian market is as important to us as the international one. Obviously, a high share of inner-Russian orders in the overall firm order portfolio is quite normal, as foreign customers always await the feedback from operators in the country of manufacture. However, as the production output grows, we expect the amount of foreign orders to rise considerably.

Andrey Vladimirovich, we cannot omit the following question: what do you think, why despite the fact that the Russian market surely needs the SSJ-100 it has been facing such an active negative campaign particularly in some Russian mass media? Any operational defect, however petty, even during testing – an obviously unavoidable occurrence at the beginning of operational service – is described as a real catastrophe…

One has to understand one thing very clearly: we have literally squeezed our aircraft into a business field where nobody was expecting us – neither in the Russian, nor in the international market. In Russia, the sale, spare parts supply, operational leasing, technical service and maintenance of foreign second-hand aircraft is a very profitable business generating enormous revenue. So the people involved have a lot to lose and to fight for. One common strategy is to generate a negative opinion of a competing product. And if we were located only in Russia, that strategy most likely would have succeeded. But it is hard for our critics to ignore the fact that our planes have been successfully operated abroad – in Indonesia, Laos, and, since recently, in Mexico.

And yet, you must admit that the problems described in the aforementioned publications do exist in reality. And the supplied components make up for some 70% of all defects. Hence the question: how do you work with the suppliers?

Indeed, we need to improve the reliability of some components and systems. And we expect our project partners to do the same. Among our suppliers are leading international companies supplying components to almost all leading aircraft manufacturers. Now that the SSJ is in full-scale operation we can back up our position by quoting reliability statistics and other hard digits. Generally, the supplier evaluation system is an inherent part of quality management. Let’s take a ‘classical’ example – the SNC system – which provides supplier evaluation criteria, such as price, quality, delivery times, post-sale service etc. Based on this comprehensive evaluation, we hold meetings and conferences with our suppliers and examine them.

However, many Russian companies still display a very formal approach to it, while you take it seriously…

No wonder! If there is no real competition, such a formal approach will persist. Since the majority of our suppliers are monopolists in their area, they have no incentive to improve their product quality. As to us, we have to live up to international standards – we got into this environment and penetrated this market, where all marketing elements are equally important. Indeed, our plane is very good and technically up to date. Yet, it additionally requires modern sales financing models, modern technical support, maintenance, crew training etc. All this must be competitive, of very high quality, and there must be a lot of it. Furthermore, one must not forget spare parts warehouses all over the world offering competitive prices. The operational quality of the aircraft must meet contemporary requirements. So this was the load we were carrying when we entered the competition. Airlines are beginning to compare the quality of the SSJ with that of competing aircraft. The customer cares about the quality of the final product, and as producer of a high quality product I am responsible for it.

Currently, you are taking the step towards middle-scaled serial production of the SSJ. Can you give us specific figures?

As I mentioned before, this year we are planning to produce 26 aircraft. Accordingly, the assembly line cycle is being reduced. Last year we produced 12 SSJ-100, which corresponded to a cycle of 30 days. Now we have reached a 10-day cycle, and our aim is to achieve a 7-day cycle in 2016 in order to produce one aircraft every week, and then even every 5 days. But this only applies to the assembly line, as the customization requires more time. A cabin cannot be installed in 7 days, and the painting takes 12 days. According to our calculations, we are going to generate operating income in 2015 and become profitable in 2016, when we reach a production level of 60 aircraft per year.

The implementation of this very first project surely required a profound change in production management, work organization etc.?

Of course. Our project is particularly difficult, as the final assembly line building has already been built, the number workplaces there is limited, and we cannot apply the strategy of physical expansion. What remains is improving workforce productivity and production efficiency. If we take last year as a reference point, productivity must be increased fourfold.

We try to do so by optimizing the inner structure of the corporation, redistributing the competences, and getting the specialists closer to the point in the assembly line where a problem occurs. Many competences were delegated from the management centres in Moscow to the production level, and the foremen on the ground are no longer left alone with arising problems as it used to be before. Instead, a whole bunch of specialists – designers, technologists – are involved in finding solutions to those problems. Everything related to the production flow and manufacturing activities remains at the level of manufacturing facilities. But once the flow is disturbed and we lag behind the schedule, the issues are delegated bottom up from Komsomolsk and Novosibirsk to huge departments in Moscow, where they are taken care of by qualified specialists in accordance with approved procedures. For instance, in case of massive manufacturing defects the staff in Komsomolsk does not deal with it. Instead, it is dealt with ‘on top’, at very different management levels.

You have mentioned better workforce productivity: are you focusing on technical conversion?

If you mean mechanical processing and mechanical assembly, these production fields can be automated by buying brand new equipment and using it, e.g. for connecting the wings or assembling big components. Yet, the final assembly at all aircraft facilities in the world is performed manually. Here, we focus on engineering solutions allowing us to improve productivity, i.e. on making the aircraft a highly technological product. However, the actual organization of the production process, such as the structure and organization of the workplaces, is equally important. As to the technological side, it consists of design solutions allowing simplifying the assembly and increasing the final quality of the aircraft. While formally we used to see quality only as a customer criterion important to the airlines, we now consider higher assembly quality as one of the factors that determine better workforce productivity: better product quality cuts the losses related to defect correction.

One of the elements in our fight for quality was the introduction of visualization last spring. The production controllers received tablets along with the task to take pictures of assembled components from pre-determined control points. These pictures taken at intermediate assembly stages are uploaded into the central database, which now contains more than 20,000 pictures. And if a defect occurs during operational service, we can easily, within an hour, find out at which assembly stage the construction standards were breached, which controller accepted the work, and determine exactly whether the defect is ours or occurred during operational service. Such ample photograph database also enables us to systematize typical mistakes in order to better deal with them later on. But not by means of tracing and punishing the culprits – such approach would only make people hide their own mistakes and those of others. The most important thing to us is to identify the problem as fast as possible, find out why it occurred, and develop a set of measures to avoid it in the future.

So this is a variation of the so-called ‘brilliant’ system?

Indeed, ‘brilliant’ within the framework of our realities. Assembling an aircraft requires tens of thousands of different operations and involves hundreds of people. And if a defect or deviation from the technical documentation is identified in the very final stage of an independent inspection and acceptance, it is very hard to establish when that defect occurred. Correspondingly, it is hard to develop the right corrective measures. For instance, the specified distance between two pipes has not been kept: it should be 10 mm, in reality it is 9. It is not a fact that the piping has been assembled incorrectly. Maybe it was coincidently displaced during the installation of other components or at another assembly stage. The visualization system allows us to identify the point of occurrence of the defect very precisely, and to develop the measures that will prevent it from occurring in the future. In addition, it gives us a personalisation of the responsibility of the process participants. Thus, it enables us to enhance our professional staff database by providing objective quantitative and qualitative evaluation of their work. We don’t just assume that one particular employee is good, because of long-standing experience in the industry. We know it for sure, as his production process provably has very solid quality records.

Thus, you are approaching the grading system?

Exactly. And the database records provide the base for promotion. We don’t punish people for wrongdoings, but we help them climb up the career ladder and make other related decisions depending on objective, provable facts.

These statistics are very useful, indeed. However, they are based on the results of the work already performed. What about a staff tool that would allow you to pick the right people for the particular operations from the very beginning, based on predisposition and preferences? At the Volkswagen plant in Kaluga, for instance, before being assigned a particular job at the assembly line, every worker is deployed to various sections of that line in order to identify the most suitable future working place. Some people e.g. are predisposed for monotonous work, while others are definitely not… Generally, as practice has shown, a systematic focus on human-related matters, such as corporate psychology – sometimes even small research departments are set up for this purpose –, generates a tangible market advantage for the companies who do so. It seems that Russian high-tech companies are ready for the market in that regard.

I fully agree with that. We also face these problems every day. Today, young people join the aviation industry for romantic reasons. They want to learn ‘how to build planes’. But then they face the hard reality: working in the aviation industry implies high responsibility. It’s a very hard job involving a lot of paperwork – regulations, requirements, limitations etc. Many people are not ready for that. I’m not only talking about workers, but also about engineers, technologists, foremen etc.

In addition, you constantly face the need to train your staff. For instance, your facilities will shortly be receiving components from new composite production plants in Kazan and Ulyanovsk. And you will have to train your employees to work with these materials, won’t you?

Indeed! And these plants have incorporated new requirements with regard to composite production. And it is going to be very difficult for the staff to adapt to them. So I agree that the employees must be prepared for production in due time. Today, when new employees join us, they may be disappointed after three months, although we invest money into them and branch off resources for their training …

In the last edition of ‘Umpro’ we talked about the experience of the automotive industry training centre in Kaluga: they apply this kind of pre-employment suitability check to anybody who is going to join one of the local automotive companies.

We did a similar thing in Novosibirsk. With the support of the local governor we set up a training cluster, which included professional training schools, the technical college, the technical university, and the aircraft manufacturing factory. Right from the school bench we picked guys who would then attend the university or college, but already know in which assembly hall they would work and how much money they would earn later on. They began to gain practical production experience at school. Many of the children had a difficult family background, and a school traineeship earning them some 10,000 roubles, which sometimes would exceed the earnings of their parents, was very effective motivation.

All well and good, but the problem is that our companies display a rather intuitive approach to this task, and there is no consistent methodology of such human-related concepts, no knowledge of the particularities of human perception etc. And that is despite the fact that creating it most likely would not cost that much… As to workforce productivity: machine processing time is not the only factor, the exchange of dies is equally important…

I agree. In this context, the introduction of tablets, i.e. the visualization of the production process and the subsequent work with the growing database resolved a whole bunch of problems. For instance, we immediately found out that it was very difficult for an inexperienced person to perform assembly operations based on the original technological documentation created by our technologists.

This very lack of understanding is the source for mistakes in the assembly line. Formally, we, the top management, didn’t see these problems and never wondered whether the descriptions of technological processes were written in a language workers could understand. We carried out an experiment in one sector of the assembly line: we invited quite an experienced worker from a neighbouring sector, gave him the relevant technological documentation, and placed him at the assembly line. He was not able to do anything. Subsequently, we re-formatted the technological process and visualized it by supplying it with photographs and 3D models. The second time the very same worker was able to perform 70% of the required assembling operations – although he had never performed them before. Then we improved the technological process once again. But the main lesson we learned was the necessity to revise the development standards completely and change the very format of the technological information we provide to our employees.

In western countries there is a lot methodological documents describing the optimal way of presenting that information…

As to us, we’re just beginning to realize how necessary that is. The core problem is that we have already entered a highly competitive market, while the workforce productivity in Russia still remains extremely low.

By the way, this proved to be the case during the WorldSkills competition in Leipzig last June. This competition showed that while our workers are quite competitive in terms of product manufacturing, they considerably lag behind in terms of time saving and self-organization.

The main problem is not even the intensity of work, but its efficiency at every given workplace. Therefore, we need a broad introduction of advanced management technologies. Currently, they are very little taught in our country and their implementation is barely supported…

I remember, back in the Soviet era many factories had their own so-called department of scientific workforce management. Obviously, the idea was delegated top down, and there was no incentive to actually fill it with live – there was no real competition, so such departments existed only on paper. But the idea as such was right.

Yes, and today there is an incentive, and that’s why we have been actively introducing the LEAN technologies, which allow us to eradicate the seven main sources of loss. We analysed the situation in our production facilities and found out that our workers spent up to 40% of their working time waiting for something, looking for the tools or details they needed etc. All this is lost time. So we decided to revise the entire production structure and organization in order to make everything revolve around the needs of the workers and ensure the best possible working conditions. We did so because we understand that the more efficient each worker is at his working place, the more the company earns. The most difficult part was to change the mentality, especially of the middle management. Here, the LEAN technologies help us a lot. And only when these processes are finally refined and work smoothly, can we successfully introduce IT solutions. Not beforehand, since implementing IT solutions without any preparation is like laying asphalt in a puddle. Now, they are working very efficiently. For instance, one can enter employee statistics records, the so-called KPI (Key Performance Indicators). Thus, people get money for real performance.

It is obvious why the mentality change turned out so difficult – your employees had a strong background in the military industry, which has its own established concepts of aircraft design and production.

In this regard we have very much benefited from our Italian colleagues and partners, who have been supplying both Boeing and Airbus for a long time. Alenia brought in invaluable experience and knowledge in the field of modern European civil aviation and serial production of civil aircraft. The company has access to all standards, organizational processes, and quality management support. We have been soaking up this experience, adapting it to our realities. Many SCA employees have undergone a traineeship in various facilities of Alenia Aermacchi (Alenia Aeronautica).

The Italian colleagues also supported us in the EASA certification process. Without their immense knowledge in this field it would have taken much more time.

Andrey Vladimirovich, let’s go back to the original topic of our conversation and try to make a forecast: how does the future of the SSJ and further SSJ-based series look like?

The series is surely going to enhance. I think that we have just entered the market and it’s too early to provide a reliable future forecast for the aircraft. But science and technology develop so fast nowadays that every 5 years we are going to carry out a profound modernization of our airplane, which is definitely not going to vanish from the market in the next 25 to 30 years. We have occupied a particular niche in the segment of regional aircraft with a particular fuselage diameter. The diameter we offer is more comfortable for the passengers and more suitable for cargo transportation, since it has big cargo holds. Further perspectives of aviation development largely depend on the use of composite materials, and why should we not consider developing a composite wing for our plane in 10 years or so? Our engine designers are also actively working, and we expect them to come up with innovations – they are reducing the engine weight, increasing its efficiency, examining the prospect of using biofuel, i.e. implementing a broad spectrum of modernisation programmes. And look at how the avionics and electronics have been developing! The aircraft contains hundreds of kilograms of wire – it’s comparable to the human nervous system. We have increased the quality, reduced the intricacy, and lowered the weight, thus reducing the prime costs of the aircraft. In view of this development pace, I am looking optimistically into the future of the Sukhoi Superjet 100 – I think it is going to be produced for a long time while undergoing constant improvements.

Authors: Interview by Gennady KLIMOV and Svetlana BAKARJIEVA
umpro.ru

06 Mar 2014 23:31


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