Start-up firm SafeFlights plans to go live with blockchain for the aircraft parts market in January 2018 in time for the Singapore Air Show, according to CEO and Co-founder Eleanor Mitch.
SafeFlights plans to create private blockchains for enterprises and link them seamlessly with existing Enterprise Resource Planning (ERP) systems. “We bridge the physical-digital gap for parts provenance,” Mitch explains. “We are developing a consortium blockchain so that OEMs, MROs, suppliers, airlines and governments can participate and update the blockchain as a part moves from entity to entity or airframe to airframe.”
The aim is to break down silos so companies that are part of the trusted network can see an asset’s journey from cradle to grave. Blockchain data cannot be altered or deleted without the consensus of all trusted parties. “Only trusted, verified parties can participate, which eliminates the possibility of human error or bad actors entering the supply chain,” Mitch says. The SafeFlights CEO says digitizing paper data will also save cost
Once the system is operational, trusted employees or managers will be able to view the status and full provenance of a part. “Gone are the days when back-office staff search through piles of paper for a form or waste time with heavy data-entry workloads,” Mitch says. Near real-time automatic integration of data ensures asset stocks and provenance data are properly secured, streamlining supply chain flows.
And smart contracts in blockchain will be able to execute in near real time. On contract execution, payment presentment and receipt can be near real-time as well. “Imagine how improved financial efficiency will be with the reduction of 90-day, 60-day and 30-day payment cycles for payment upon execution,” Mitch says. “Financial resources can then be used appropriately rather than stuck in the payment traffic jam.”
Mitch acknowledges there is a learning curve for blockchain and its possibilities. “At first, people are hesitant. However, once they learn that the SafeFlights solution can be integrated seamlessly with their existing ERP and requires minimal staff training and resources, people become excited about getting ahead of the curve and saving money.”
Mitch believes the SafeFlights solution might become a new standard for aerospace supply chains. She believes insurers could join the consortium and offer lower premiums to companies adopting the SafeFlights solution. “If insurers can be certain that an insured asset really comprises trusted parts and trusted provenances, they can avoid losing money on claims for mixed-reliability provenances. Gone will be the days when an MRO can insert an older part on the fly into a brand-new engine, reducing the value of the engine without the client’s and insurance company’s awareness. Asset value is protected and insurers can have certainty as to provenance.”
By early October 2017, SafeFlights was finalizing a partnership with three different organizations to launch the first iteration of its SafeFlights solution and was negotiating with an airline to adopt the solution. The firm is currently looking to establish strategic partnerships with major players so widespread adoption can be jumpstarted. “Time is the main hurdle,” Mitch explains. “But we keep getting expressions of interest, so we’re on the right track and there’s a lot of enthusiasm.”