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Mike Skorija’s job is to take extremely complicated processes and boil it down to simple, manageable solutions. As the global supply chain director for RTI , Skorija was recruited to develop RTI’s corporate-wide supply chain program and create its vision going forward as a central part to this vertically integrated company. RTI’s trio of distinct business units center around the titanium products industry. The company’s titanium group produces a full range of titanium mill products, such as ingots, slabs, plates and sheets.

The fabrication group takes that process one step further, or several steps depending on the need, and creates value-added titanium products through fabrication, machining, cutting and assembling to deliver a complete solution to the customer. The company’s recently created distribution group was separated from the fabrication group in 2009 to create better oversight of RTI’s distribution potential. 

As with many corporations with various revenue streams, RTI’s creation of a vertically integrated entity to serve the aerospace, defense, energy, medical and sporting equipment sectors not only creates synergies internally, but positions the company as an invaluable one-stop shop for external clients. Within that model, the company develops overarching managerial operations that essentially act as the glue holding the vertical processes together – the supply chain program is one such glue. 

“Our corporate supply chain staff is made up of 10 subject matter experts with considerable hands-on experience that cover purchasing, planning, warehouse and logistics as well as reporting and metrics,” Skorija explains. “We then coordinate within the supply chain management at all segments and levels. We set the foundational structure and the rules by which to operate the entire supply chain by. Each segment has their own needs, so foundational elements from the model are consolidated into a group of operational metrics we call the ‘OPS Book’ and are set as the building blocks. The individual business units customize their approach to meet the business model needed by the individual customers, but are able to be synchronized in the overall entity as one integrated RTI strategy.” 

To get the entire organization on one supply chain page, Skorija and his team first laid out the three objectives of the program that will create efficiencies throughout the entire company. 

• To create a synergistic supply chain model in sync with customer demand and operation capabilities. 
• To allow visibility into all segments of the business to drive and measure performance.
• To take a complex set of situations and business requirements and break them down into manageable components where actions will receive clear bottom line benefits. 

In a nutshell, the first objective asks the question – what do our customers want and how do we make our supply chain line up with the customer’s needs? The second objective sets out clear goals and equally clear ways to measure performance in realizing those goals. For the third objective, Skorija explains that “if you try to understand and act on all facets of the supply chain at the same time, you may become paralyzed by extensive analysis and never actually get started on any initiative,” he says. “Instead you need to focus on basic ‘blocking and tackling’ to define your processes. It is that foundation from which you build your organization on.”

By laying out these three objectives, RTI’s corporate supply chain department has transformed from a purchaser to a central part of the company’s operations. With a new initiative, the department’s value is even spreading outside of the company’s walls.

Putting the Pieces Together

“RTI is being placed in a very unique position within the larger community of original equipment manufacturer (OEM) providers of commercial and military aircrafts to provide integrated oversight,” Skorija says. “We will provide oversight and full transparency of all titanium materials from the main assembler of the aircraft back down through key OEMs all the way back to raw material suppliers.”

Before joining RTI, Skorija was a methods engineer and a cross-functional program manager with IBM. He expanded his international experience with high volume discreet manufacturing operations with Hewlett Packard and The ABB Group. The foundation and lessons he acquired led to the development of an integrated transparency model across a multitude of providers while pulling demand from the customer’s requirements. He calls it an integrated master-planning tool (IMT). Instead of focusing on each piece from beginning to end, the process starts its planning from the final assembly and what steps need to happen to get there. 

“A metaphor I’ve used is that if you picture the inner working gears of a watch, each piece is an individual driving force but the overall goal is to get those pieces to function as one,” Skorija explains. “If any of those gears are slipping, you don’t get the right output. Everything has to work together.” 

Instead of managing the supply chain of a company who may make an assortment of products, the IMT focuses on one product, a large product, and all of the parts, pieces and parcels it needs to reach its final destination on time. In the recent assembly of an F-35 aircraft, RTI introduced its integrated supply chain solution to bring all the components together seamlessly.

“For a completed aircraft, you have large sections of a plane built by different companies that need to come together,” he says. “One manufacturer is producing the mid section, another the wings, the tail section etc., and at the end they assemble it into a finished aircraft.”

 Skorija explains that in the same way one aircraft is made of multiple large sections, one of those large sections may have five other suppliers that all contribute to that one section. That concept continues down the entire line and ends at the raw material suppliers. 

“You take each smaller piece and look back and see how many little pieces are on the tail section for instance and who provides them,” Skorija says. “Who did the machining, who was the forger, who provided the general raw material pieces? You can go back to 100 to 90 providers that appear in the bill of material and we put all of that information together.” 

That information provides transparency into every titanium supply component for the entire F-35. RTI’s supply chain department takes on the complex challenge of tracking each material supplier, what they are supplying and who they are supplying to. RTI’s client determines the date for final assembly, and by working backwards RTI can guide each supplier on when the component needs to be ready and shipped. Through this new  service, RTI will bring in new revenue streams that the company expects will significantly increase its 2012 revenue. 

“In an integrated supply chain, there are a lot of processes that have to be in sync with each other to work together as one to pull the material through the chain and not push it,” he says. “Every single part is being made in preparation to hit the final assembly line and allow for an uninterrupted process.”