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Jan. 17, 2025, 8:46 a.m.
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The Value of Proper Documentation in Aerospace Parts and the Role of Blockchain

Brief news summary

Effective documentation is crucial for accurately assessing the value of parts, as poor records can lead to undervaluation, while incomplete documentation may inflate values. A Deloitte audit reveals that over 60% of delivery problems are linked to inadequate paperwork, causing average correction delays of 34 days and raising the risk of fraudulent documentation. This underscores the need for secure documentation practices. Blockchain technology presents a viable solution by offering a tamper-proof digital ledger that tracks part lifecycles and inspections, restricted to authorized users. This innovation could improve asset valuation and simplify record management. However, blockchain adoption in the Middle East's Maintenance, Repair, and Overhaul (MRO) sector is limited, with companies like MTU Maintenance and Lufthansa Technik yet to fully embrace this technology. While Sanad initiated a successful blockchain pilot for IAE V2500 engines in 2019, progress was hindered by the COVID-19 pandemic. A U.S. study emphasizes the need to digitize vital documents and use digital signatures to prevent unauthorized parts, highlighting that broad commitment to blockchain technology remains a challenge in the aerospace industry.

Parts lacking proper documentation are nearly valueless, and those with incomplete documentation hold only slightly more worth. A recent audit by global consultancy Deloitte revealed that over 60% of issues when receiving parts stemmed from inadequate or absent paperwork, often taking an average of 34 days to resolve. There's also a significant risk that parts with fraudulent documentation may enter the supply chain, highlighting the critical need for secure records. Blockchain technology is often proposed as a solution. It consists of a cryptographically secured, immutable data chain recorded on a digital ledger, which allows anyone with access to verify a part’s history through its hash or block number. Deloitte indicates that blockchain provides a unique ‘part-centric’ view, detailing a part's performance throughout its lifecycle, both in the supply chain and during operation.

This method allows for comprehensive documentation of each part's history, ensuring asset value maintenance while facilitating record management and process sharing. However, adoption of blockchain in the Middle East's maintenance, repair, and operations (MRO) sector is still limited. MTU Maintenance has yet to implement blockchain, with some staff merely monitoring its development. Lufthansa Technik similarly does not currently use such technology, and Magnetic MRO has no immediate plans for its introduction due to widespread non-adoption. Conversely, Sanad, known for its technological advancements, has closely examined blockchain and conducted a successful pilot program in 2019. This pilot aimed to create a secure distribution ledger for tracking parts, collaborating with Block Aero Technologies on IAE V2500 engines. Although Sanad intended to expand its blockchain use post-Covid, priorities shifted towards other innovations, though it remains part of their long-term plan. In the U. S. , a nine-month study on unauthorized parts recommended that suppliers digitize critical documents and increase the use of digital signatures, resulting from a collective effort by airlines, OEMs, and MROs to combat issues related to false documentation. For blockchain to be effective, broad support from the aerospace ecosystem is essential, but widespread implementation remains unlikely in the near future.


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