Testing Takes Time… and Time Is Money
The Sente Group Inc.
For high-tech electronics companies, such as General Dynamics Land Systems, testing is indispensable to success. Engineering personnel spend significant amounts of time and money in test design, test execution and test-equipment procurement.
Headquartered in Sterling Heights, Michigan, GDLS employs more than 7,400 people who design, manufacture, and support land and amphibious combat systems for the U.S. Army, the U.S. Marine Corps and allied nations.
Few defense contractors see the effect that their testing function has on profitability, time-to-market and engineering productivity. Even fewer have the practices, tools and people it takes to implement plans that produce measurable, sustainable results, which is why GDLS embarked on a program known as test resource management (TRM).
Rigorous performance metrics for GDLS were exceeded on a number of fronts. Capital-spending reductions surpassed 100 percent of the goal, and operating-expense savings and cash-flow goals were bested by more than 300 percent. The program also helped GDLS break down interdepartmental barriers, resulting in more efficient access to more effective test equipment and significant reductions in wasted lab space. Low utilization rates are particularly alarming when considering the high purchase price of the test equipment frequently found at any given location of a large defense contractor.
"Do the math," says Paul McNamara, CEO of The Sente Group Inc., which developed TRM. "You get a clear picture of the financial case for change in the test environment. If you have 5,000 pieces at $6,000 each, for example, you're looking at $30 million invested in equipment. Most of it is likely sitting idle, and half of that idling into obsolescence.
"It sounds hard to believe, but we find test equipment sits idle 85-90 percent of the time in the defense industry," continues McNamara. "Furthermore, we find, at times, upward of 50 percent of test equipment no longer meets ever-changing industry standards. The combination creates high-cost, high-risk exposure for product development cycles."
"Test Resource Management helped us integrate utilization of test equipment among our labs," says Norm LaPrise, engineering design and development laboratories manager at GDLS.
GDLS hosted forums to ensure that engineers and technicians, the program's primary customers, understood the costs and benefits, how it worked and what results to expect.
"Regardless of whether management supports an initiative, the end-user of the equipment must be on board or it's doomed to fail," LaPrise says. "Engineers don't respond well to programs that are forced on them. They remember past programs that didn't work and disappeared."
LaPrise says that the strategy of implementing the program "one campus at a time" was also important. This gradually created a buzz from one group of satisfied customers that could be leveraged before and during the program's introduction into the next campus.
GDLS surveys formally measured customer satisfaction. End-users consistently gave high marks to the program's performance, importance and usefulness. Action was promptly taken to address any negative feedback or suggested improvements.
Through October 2005, 99 percent of all equipment requests were fulfilled as specified and on time. End-user requests for equipment were measured by tracking the percentage of requests kept as specified, and the time required to fulfill each request.
Today, GDLS leaders see the program's cultural effect and confirmed cost savings.
"Engineers now think differently about sharing test equipment, more along the lines of a business within a business," LaPrise says. "TRM has helped us integrate test functions among departments as a means of improving output for the entire division, adding new power to GDLS' ability to execute on its contracts. We now know how to forecast technology and can communicate with our engineers to determine what test technologies we will need well ahead of time. It's helped us turn our engineering community into a proactive player, rather than a reactive entity."
The Sente Group Inc.
- Many defense contractors' productivity suffers because of low test-equipment utilization rates. Equipment can sit idle up to 90 percent of the time, wasting money and space.
- Test resource management (TRM), developed by The Sente Group, gives managers a comprehensive view into the efficiencies of testing functions.
- General Dynamics Land Systems' use of TRM resulted in capital-spending reductions that surpassed 100 percent of the goal. Operating-expense savings and cash-flow goals were surpassed by 300 percent.
www.sentegroup.com or www.gdls.com.