MRO Survey 2015

By 2020, most companies in the aviation maintenance, repair, and overhaul (MRO) sector will use new technology in a way that fundamentally changes how the industry works, cutting or re-distributing industry revenue by up to 20 percent, or $15 billion.

According to results of Oliver Wyman’s 2015 MRO Survey, the use of big data in the aviation industry will become pervasive, with the rise of aircraft health monitoring and predictive maintenance systems. The way MRO providers touch the aircraft will also change with wearable and other new repair technologies and additive manufacturing (3-D printing). Meanwhile, most aviation companies will have to manage overhauls of their aging IT backbones that inhibit efficient working environments and integration with newer technologies.

MRO providers must also invest in different capabilities during the next few years, as manufacturers deliver next generation aircraft and engines with new technology and services.

The survey authors anticipate these advances could spawn new business models. This could amount to a redistribution of up to 20 percent of value among current industry players, or $10 billion to $15 billion, and entice new, non-traditional competitors to enter the MRO space to siphon off high value revenue opportunities.

To compete as technology changes, MRO providers will have to overcome their own reluctance to innovate. Most survey respondents said their organizations have clear visions and growth strategies, but gave their companies failing grades on the ability to translate identified opportunities into executed operational plans.

Disruptive change will challenge managers to think beyond standard practices and commit time and resources to choose technologies and develop supportive business models. Within MROs, there is a need for clarity, purposeful analysis, and selection of the right opportunities to capitalize on innovation.

1What will be the most influential new technology for the MRO industry in the next few years?

Big data. It’s becoming the cliché answer, but for aviation, it’s true. Aviation companies now have the ability to collect detailed data on planes and engines using health monitoring and predictive maintenance systems. That will change the way MROs care for planes and engines.
2Will big data transform the industry?

It could, if airlines assert ownership of their data. Manufacturers have always collected data from operators about their products in order to understand customers and make improvements. But with the ability to use data to improve maintenance, that data becomes an asset. Carriers flying large fleets of similar aircraft could gain a significant competitive advantage by keeping much of their fleet data proprietary.
3Are survey participants right to focus on big data?

Yes, they are right to focus on something important to customers. But we were surprised to learn from the survey that another potentially transformative technology, 3-D printing, isn’t getting much attention. We think additive manufacturing will arrive in aviation in a big way sooner than many people think.
4Are MROs becoming innovators?

MROs are still reluctant innovators. They tend to follow the customer’s lead rather than jumping ahead to develop a new product or expertise. Within MROs, there is a need for clarity, purposeful analysis, and selection. MRO leaders must commit time and resources to successfully pick and choose technologies and develop beneficial business models.