AS9145/APQP return on investment

g_dep1

Starting to get Involved
#1
Hi everyone,

I work for a defense contractor looking to further adopt AS9145. From a cultural standpoint, there seems to be a lot of "lip-service" or superficial support from our top leadership when it comes to APQP. Our customer Lockheed Martin, flowed down APQP and PPAP requirements which is where our top leaderships verbal support for integrating the APQP tools into our current operations is coming from. However, since a lot of our defense programs have tight budget and resources, getting the engineering resources to complete tools like DFMEA, PFMEA, etc is still a difficulty.

Is there a way to quantify the ROI for implementing APQP on new products for defense programs? Basically stating that due to costs being avoided, there can be a Return on Investment (allocating engineering man-hours/resources) in completing the tools. I think top leadership know it's "the right thing to do" but when it comes to walking the walk, there seems to be resistance and just a request for quality to "check the box." They will never say that explicitly though (politics).

Really curious to hear other's thoughts on this.

Thanks
 
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Sidney Vianna

Post Responsibly
Staff member
Admin
#2
AS9145, the IAQG version of AIAG APQP, was the result of a well planned infiltration by a consulting company that, for the obvious reasons, I will not mention the name. They are probably cashing in with the training sessions.

Nevertheless, the methodology behind APQP is sound. It should go without saying that there is no such thing as excessive planning and risk mitigation, when it comes to complex projects. You already mentioned the keywords - corporate culture - A well executed APQP places a LOT of effort in the early phases of the projects. Unfortunately, too many organizations and people are not used to dispense a lot of resources in the early stages of a project. The typical approach is that, when the project is way over budget, way behind schedule and the design is significantly underperforming, resources are "thrown" at it. So, the issue, the way I see it, is much less RoI, but Project Management re-thinking, to mitigate the typical dysfunction.

If you really want something along these lines, of ROI on APQP/PPAP implementation, check https://iaqg.org/wp-content/uploads/2019/10/planning-for-quality-QP-article.pdf

Good luck.
 

Ninja

Looking for Reality
Trusted Information Resource
#3
From a background of trying to justify automotive APQP to top management...stop trying...it's a losing game.
APQP may well be the best risk lowering approach out there for the customer, but trying to defend it as/to a vendor is a losing battle.
You're measuring today's cost with tomorrow's "what if" risk...no one will listen to you in the vendor company, even if it does save you millions "maybe" later.

If it's a ticket to play, there's your defense. Outside of that, it may save you millions...but that's later...you can't defend it as a vendor looking only at present quarter. That's why it is imposed by the customer...it has quite a bit of value on the customer side...
 

outdoorsNW

Involved In Discussions
#4
The ROI will depend on volume as well. Some projects never have more than a couple of dozen parts of modest value built where APQP makes the project a money looser unless the customer is willing to pay extra. Others have thousands of parts built.

I am somewhat cynical of APQP in aerospace because I have seen too many cases where the customer did not understand what they were asking for, so they asked for everything in the book including things that made no sense for the particular product. When I asked them to clarify what they needed, the answer made clear they had no idea what they were asking for.

I also have encountered too many cases where the person asking for APQP did not coordinate with purchasing and purchasing did not order enough parts to get the sample size the customer's APQP person wanted. For the type of low to medium volume products I have worked with, we were not going to build any more than the amount needed for the PO. The risk of never getting another order for that part and being stuck with unsellable inventory was too high.
 

John Predmore

Quite Involved in Discussions
#5
Is there a way to quantify the ROI for implementing APQP
The way I quantify the potential payback of APQP is by looking at the auto industry, where I started my career 40 years ago. In the factory I worked, one of the Big Three, reject rates were commonly in the neighborhood of 5%, this despite dedicated human inspectors at every major operation. The first new car I purchased went back to the dealer 14 times for warranty work, and this was when the warranty period was 12 months or 12,000 miles. Today, the automotive warranty period is 5-8 times longer, and if you do receive a recall notice it is a proactive campaign, so customer inconvenience is minimized.

By the time I left the auto industry 10 years ago, reject/rework was measured in parts per million, and the US automakers are on a par with the world's best, operating in the neighborhood of a hundred ppm. The car makers did not achieve 1000-fold improvement by hiring 1000 times as many inspectors, or 1000 times as many engineers. Three orders of magnitude improvement was achieved with quality by design, quality at the source. APQP is a key chapter of automotive history.

It is true automobiles cost several times more than they cost 20-30 years ago. But cars today typically last 10-20 times longer, are more reliable in MTBF, require less upkeep, and operate more robustly in a multitude of environmental and driving conditions. Ask someone who remembers the way the auto market was 30-40 years ago.
 

Jim Wynne

Staff member
Admin
#7
The argument could be made, and perhaps should be made, that improvements in materials and technologies are as much to be credited with vehicle improvement as anything else. The American automotive industry still does a lot of things very poorly and wastes oceans of money every day.

Think about what's being asked here, regardless of the industry. Is there value in doing as much as possible to anticipate and mitigate problems in design and production early in the process? Of course there is. It's what engineers should be doing as a matter of course. Why is it necessary, then, to elucidate and justify the bloody obvious to top management? There are a lot of answers to that question, but it's been being asked forever, practically, and there appears to be no end in sight. The best you can do is attempt to apply reason and logic, but be forewarned that justification using reason and logic are mostly impotent against ideas that were formed without using reason and logic.
 
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