Case Study: Adding Value With An Integrated Manufacturing System

In previous years, Phoenix Logistics managed their low-volume, batch-manufacturing process with non-integrated manual and paper-based systems. Now, after integrating their manufacturing systems, one of the most significant achievements experienced by the company is paperless, integrated real-time traceability.

Arizona-based aerospace manufacturer Phoenix Logistics, Inc., designs and produces integrated data transmission solutions for global military and aerospace markets.

The company provides the design, manufacture, and testing of high-frequency connectors, cable assemblies, and components. Major aerospace customers include Lockheed, Northrop Grumman and Boeing.

Recent applications include supplying data bus components for the NASA Lunar Reconnaissance Orbiter’s mission to the moon; high frequency subassemblies for the International Space Station; and data transmission solutions for multiple helicopter, fighter, and transport platforms.

Silos of Information

In previous years, Phoenix Logistics managed their low-volume, batch-manufacturing process with non-integrated manual and paper-based systems.

The company relied on nearly 40 stand-alone spreadsheets to track customer orders, accounting, parts traceability, inventory, shipping, and other key areas— literally silos of information with no linking of data across the business.

The company stored all documentation and production source documents in over 50 filing cabinets, managed by one full-time administrative clerk dedicated to the sole task of moving and controlling documents.

Overcoming Document Control Challenges

One of the most significant limitations with the previous methods was complying with AS9100 production requirements for lot traceability. AS9100 is an international aerospace standard that stipulates full lot traceability documentation requirements.

Compliance was difficult because the company stored paper documents tracing the source of key materials and processes such as plating, cable, and other components in file cabinets in a large room. It took a clerk three to four days to search and pull bills of materials and assembly procedures from the hundreds of file folders. There was no standard document control, and it was difficult to track BOM or process instruction revisions.

Inefficient Ordering Process

Processing customer orders was also inefficient. When Phoenix Logisitics received a customer order issued by Lockheed, Northrop Grumman, Boeing, or other OEMs, workers keyed the order data into a standalone system. The order was then approved by passing a folder from department to department. Various reports were generated to determine material to be ordered, jobs released to production, and shipments to be made.

In addition, the customer order data was verified prior to generating a job and then re-verified when the job was issued to the shop floor, again when products came off the floor, and one final time before the order was shipped.

Engineering Change Request (ECR) Process

Engineering change request (ECR) documents were manually routed within the plant for approvals and disposition. Paper forms traveled more than a mile within the plant for handwritten signatures.

As with any paper-based system, there was a high likelihood for error, duplicate and triplicate data entry, lost papers, and poor communication between production and purchasing to manage the configuration of product shipped to customers.

A Better Way

Using Plex Online, Phoenix Logistics replaced stand-alone manual and paper-based work processes with automated electronic workflows.

Implementation began with the accounts payable, accounts receivable, purchasing, customer orders and shipping functions going live in six months. Inventory, engineering change requests, quality, document control, manufacturing jobs, MRP/PRP, and costing were functioning within another six months. Additional functions implemented include: time and attendance, program management, human relations, and strategic planning.

Automated Real-Time Traceability and Production Status

One of the most significant achievements experienced by the company is paperless, integrated real-time traceability. The automated traceability system accurately tracks individual containers and/or pieces as they flow through the manufacturing process, letting the company isolate problems with pinpoint precision. Real-time, detailed historical information related to production, inspection, genealogy, and usage is available in seconds instead of days as it was with the paper stored away in filing cabinets.

The company gained real-time visibility into status, issues, projected ship date, and management of exceptions throughout the entire manufacturing cycle. This real-time visibility had not existed in the past. Management has been transformed from once reacting to past events, to now planning and executing to realize future opportunities.

Ease of Compliance

Because full and detailed traceability is built into the Plex Online inventory system, it’s simple to comply with AS9100 requirements. The Plex Online traceability tree automatically tracks in real time the complete genealogy of all inventory containers, providing both an upstream and downstream trace.

As a testament to the improved methods, Phoenix Logistics easily passed a quarterly manufacturing process audit recently conducted by Boeing. The company traces the source of production materials in seconds, isolates issues faster, and automatically generates audit reports— which frees administrative staff for more meaningful tasks that add value to the process.

Additionally a recent ISO/AS recertification audit was completed with a 25 percent reduction in audit time due to the speed of information availability and the ability to quickly audit electronic workflow records and detailed change history of every controlled document.

ECR Handling Improvements

ECRs flow automatically and in real time. No longer do paper ECR forms travel over a mile for approvals. The ECR function provides an online system for company personnel to submit change requests to engineering.

The system tracks the ECR, manages the work flow, organizes and controls the drawings, and maintains ongoing documentation of the change. Phoenix production associates now call up the ECR directly on the shop floor for a further streamlined production process.

Sales Order Processing and Data Integrity Improvements

The sales order process is close to real-time with effective customer communication and feedback. Sales order folders are no longer physically moved from desk to desk as they were in the past, taking almost a week to make the journey.

The system tracks status and who is currently reviewing the order, providing timely communication to all departments and feedback to the customer confirming delivery and technical information.

Return on Investment

Phoenix calculates a return on investment of 18 months.

Automated, real-time traceability and production status help the company achieve a cycle time reduction on the order of 9,000 percent— resulting in drastically improved response time to the customer and the elimination of two quality positions dedicated to filling out paperwork. Total cost savings: more than $89,000 per year.

The system has allowed a 25 percent cycle time reduction in relation to all customer, ISO, and AS audits, saving $3,500 in direct costs.

The supplier eliminated the cost of printing, handling, and storing over 20,000 pages of documents once generated each month, saving more than $53,000 per year.

ECR improvements helped cut processing time by 75 percent, allowing for virtually real-time changes to be implemented on the production floor. Additionally, head count in engineering remained constant while workload for the department doubled, realizing a cost saving of $83,000 per year.

Sales order approval cycle time has been reduced by 30 percent, while at the same time improving internal communication and feedback to the customer. The elimination of non-value-added validation steps resulted in another 10 percent reduction in production and shipping cycle times. 

For more information about Plex Systems, please visit

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