5 Imperatives to Be Ready for Any New Normal In the Defense Industry
Full transcript below:
Heatherly Bucher
All right, good morning to everyone who has joined us today.
My name is Heatherly Bucher and I am the Product Marketing Director at Arena, a PTC business.
On behalf of Arena, I’d like to welcome everyone to today’s session. Sorry, just getting my coffee. We’re excited to have you join us. We are taking a look at the challenges and opportunities for the defense sector today. By the end of the talk, we want you to have an idea of how you can future-proof your company’s product work as well as a bit about how companies use Arena in these areas. Before we get started and I introduce Gregg, let’s talk a little bit about housekeeping.
Heatherly Bucher
There are three polls today that will pop up in your Zoom and will prompt you, and you’ll be able to take those polls. We’d love to have your participation. We also have a little giveaway today for our live attendees. If you’re joining us on the recording, sorry you missed the opportunity. We have customers in many industries, not just the defense sector, and we love some of our killer consumer product companies, such as Sonos, and so today we like to support them by giving away one of their Sonos One players to one of our live attendees.
And then we have a Q&A with some of our fabulous subject matter experts from our team at the end of the session. And please enter your questions at any time into the Zoom Q&A. Please don’t use the chat for the questions. We won’t be monitoring the chat, but enter them into the Q&A. Again, if you are on the recording, you can feel free to email us after you watch this recording with any questions you might have that we didn’t answer during the event. After this event, later this week, you will get a link to the recording, as well as we have a short little PDF worksheet that goes along with this event and the information that Gregg and Alan are going to share about how you can prepare for these five imperatives that we’re going to talk about.
All right, I’m going to turn it over to Gregg.
Heatherly Bucher
Gregg Gowanloch is our Senior Account Exec with our defense electronics sector. Gregg, you’ve worked with customers participating in the defense supply chain for quite a while. You spend time with our customers every day, and I know you have some great insights to share about what’s going on. The challenges and the opportunities they have. So, we’re going to turn it over to you to share. Our panelists for the Q&A will come back on video at the Q&A time, so Alan and Jeff and Mark.
They’re going to turn their videos off and I’m going to turn over to Gregg to let him start talking about it.
Gregg Gowanloch
Perfect, perfect.
Gregg Gowanloch
Thanks so much, Heatherly, and I appreciate everybody’s attendance today. We’re excited to go through the content and provide a bit of background on what we see as the new normal being within this market segment. Certainly, as we continue to look upon the industry and the increased regulations and challenges that companies that are serving the defense, aerospace industries, contract work or for government, obviously a lot of regulatory overhangs in the way of things like ITAR challenges, NIST, DFARS, et cetera.
So, those regulations continue to evolve and continue to consume cycles of companies that are working within these industries, and it’s happening because of the contractual requirements that our customers and prospective clients are under. And then, outside of that, we’re seeing some pretty interesting trends in terms of the consolidation that continues to happen. It’s almost been more aggressive over the past 12 to 24 months, so a lot of private equity firms coming in and grabbing up some smaller defense-type players looking for economies of scale, looking for synergies across those businesses.
And really, what does that relate to in terms of potential impact on the business? And then, of course, just continued global events that have an impact to supply availability and potential trade disputes and things like that. And of course, we can talk about the challenges all day long, but they also present us with a lot of opportunities. The opportunities that we’re seeing are more and more complexity in the products that our customers are supporting and developing for these various defense contracts.
Smarter battlefield technologies, smarter and more robust security, and encryption, and networking technologies. So it’s this real fast-paced and innovation that continues to be at the forefront of a lot of these challenges. And then, I would say, this whole notion around what can we be leveraging within this industry sector that our commercial counterparts have been for over a decade now? And so, we’ll talk about what the adoption of cloud technologies and the federal government support for the adoption of cloud technologies has really had on this marketplace, and will continue to have, frankly, as we continue through this new normal.
So, as we talk about the new normal and what that really means for our customers and companies within this industry, one of the key foundational elements is centered around this concept and this practice of leveraging the data as it relates to your product development efforts.
Gregg Gowanloch
And I think if we expand into that, what does that really mean?
Gregg Gowanloch
And I think the big question to ask yourselves is how quickly are you able to evaluate your product data and make decisions throughout the organization that you can be really confident are 100% accurate? If we take a look at the evolution of product development over the past several decades, we’re moving from the bottom left, print-based, where mostly manual, and then getting into this workstation area where somewhat digital, albeit at the user workstation level.
And then moving to structured data sources, but among teams, so disjointed, fragmented. And then getting to where some companies are today, Arena customers included in this, where there’s more unity around the data, the product information. There’s better access to information, and there’s better connectivity between the different design tools that an engineering team, upfront, mechanical engineering team, and electrical engineering team might be using and better connectivity to the processes that are driving changes to the information.
So think about things like engineering change orders, change notifications, and requests. And then a lot of quality-related processes when the information is in our customers’ hands and what does that mean? And then, of course, feeding downstream systems. So it’s kind of been this evolution from manual, individual, really fragmented and disjointed to now unified. And really, where we’re going as a marketplace and just as an overall product development effort is this ultimate goal of full digital transformation from the ideation of that initial concept all the way to end of life.
And what we see is that business needs along the way have dictated this progression over the years, and are going to continue to do that. And so, one thing that’s been very, very clear is that there’s flexibility needed as we’re making these transitions and there’s flexibility needed around the access to data. And that flexibility is required by people being remote, and how they do their jobs. Travel in between customer sites and needing to be able to access that information.
And all the while, this connected thread to information has to be very secure, right? And, of course, COVID- 19, the past year and a half now that we’ve been dealing with this, has really highlighted this for many, many of our customers and prospective clients. One of the things that Heatherly talked about upfront is we want to do a few polls as we’re going through the session today and just get feedback.
Gregg Gowanloch
We’re interested to see what you’re experiencing and what your organizations are going through. So Heatherly, if we want to pop that up.
Heatherly Bucher
It should be up on attendees’ screens right now. Our panelists might not see it, but it should be up there and I see some people taking it, so I think we’re good on that poll.
Perfect.
Gregg Gowanloch
While we’re wrapping that up, as we transition in, and of course COVID- 19 has really highlighted this. But it’s much more than that. And this whole notion around how do we go about empowering a remote workforce and taking advantage of a lot of the benefits that can be obtained from leveraging and centralizing data. So if we go to the next slide …
Again, the question that I would be asking our attendees is, “How empowered is your workforce today?”
Gregg Gowanloch
Is it restricted to everything inside of the organization, has to be in person, and it’s all driven off of team-based face-to-face interaction? Is it somewhat leveraged? Are there some contextual elements to how you go about connecting to projects and information in the company today and how you interact with and throughout the organization? And really, as this pertains to product development. And so, as we’re seeing, and if you remember back to the “leverage the data” concept, when we’re literally drawing out on a drafts table CAD drawings and things like that, or not even CAD drawings but just blueprints, and moving to this more leveraged notion.
And I think the early indications of what we’re seeing is that what we’ve gone through collectively in the past year and a half in terms of a lot of more remote work because we had to, and early feedback is that we don’t see it entirely shift back to where everybody’s going to be in the office, at their desk, in their cubicle farms, all those types of things. So how do we best deal with that?
And I think one of the trends that we’re seeing is organizations realize that, man, we’re kind of handcuffed when we come across these types of situations. I have countless stories of prospective clients that we’re dealing with, all of a sudden, overnight, my employees are working remote. How do I deal with that? And one of the ways they were doing that is they were having to physically sign out desktops and monitors because their team wasn’t equipped with laptops and things like that.
They were having issues with VPN access because not all companies were set up to allow for employees to come in remotely through a VPN and things like that. So it was just an absolute drain on productivity, and it caused a lot of chaos. So that’s been a big driver around how do we, going forward, look to empower a remote workforce? I talked a lot about the challenges, but really what we’ve seen as the opportunity coming out of this, is that when employees are empowered and they have access to leverage the data that’s centralized and available at all times, it has a really positive impact on how companies are able to recruit, attract, maintain top talent.
And that comes back to employees having the flexibility to do their jobs when and where they need to be able to do those. And then it’s also, in terms of a bottom-line type thing, it’s having this type of strategy in place, being able to leverage this type of strategy, is reducing expenses. It’s reducing turnover because people have more of that flexibility in there. I think, more importantly, it’s allowing our customers and prospective clients to reach more broadly out into the talent pool, as opposed to many companies in this industry are centered into very concentrated technology pockets where a lot of companies are fighting for the same talent pool.
But now, all of a sudden, if we’re able to knock down some of these remote work barriers, we can exponentially expand our reach into the talent pool.
Heatherly Bucher
All right, we have a second poll, Gregg.
Heatherly Bucher
There we go, I launched it up. Everyone should be able to see that, talking about their product development challenges.
Gregg Gowanloch
Yeah, so this is an interesting one because, again, a lot of what we’re seeing through our installed base of customers and hundreds of conversations on a weekly basis, we’re getting a lot of questions in different areas, whether it’s how can we deal with counterfeit parts and supply chain resiliency to navigating these regulatory requirements that seem to be cropping up almost weekly, on some extents, and certainly yearly.
Gregg Gowanloch
A big one coming is CMMC.
Heatherly Bucher
All right, I’ll leave that poll up for attendees to take while, Gregg, you can continue on with the third imperative.
Gregg Gowanloch
Yeah, this is a huge one and it really touches on a variety of areas, but it’s this whole notion around what can organizations, and not what can they, but really what should they be doing to enhance the resiliency of their supply chains, and what does that really mean? So, if we go to the next slide, Heatherly, I’d really like to drill down into just this notion of how companies are getting products to market in this modern-day product development effort.
Gregg Gowanloch
And so, questions to have in the back of your mind would be, “How do you work with your suppliers currently?”
Gregg Gowanloch
Is it scalable? How secure is that? And can you proactively see and anticipate where some of the bottlenecks might be coming from and what type of exposure that you have? And obviously, the reason why that’s important is it impacts everything from product margins to contract delivery dates. For most of our customers that are dealing with government contracts, there are massive implications to not meeting critical deadlines, outside of the fact that there are troops, in many cases, that are really reliant on equipment being available when they need it most.
What we’ve seen over the past 40 years is a movement away from a vertically integrated manufacturing environment to an outsource manufacturing strategy. And that’s brought in a huge need to be agile and flexible with the partners you work with. Companies, need to be able to adapt to everything from capacity restraints, quality issues, and of course geographical challenges. All of our customers in this space are manufacturing in the United States, but that doesn’t take away the geographical barriers of where some of their suppliers or contract manufacturers might be located.
So there’s obviously increased complexity, potential gaps with outsourcing, but there are also significant financial and time-to-market benefits for those companies that execute well on this type of strategy. I would say, too, the other thing that we’re seeing is this rate of product complexity and technology advancement increasing significantly. And one of the things that’s driving this is just, again, the need for connected technologies, and networked battlefields, and things of that nature.
And one of the interesting trends that we’ve seen over the years, too, is it’s really increased the reliance on things like off-the-shelf components. So think about things like chips, capacitors, resistors, all of these common components that are critical to the end product. And so, we’ve seen huge disruptions in supply and availability of these types of common components over the years, whether it’s an earthquake in Japan, things like just memory shortages because the critical suppliers of memory, they cut capacity and then they didn’t ramp it back up.
It creates these temporary shortages that have an impact, just based on constraints. And then, most recently, if you’ve been reading the news and things, there’s a massive semiconductor shortage right now and it’s really a direct result of COVID. And some unfortunately bad decisions that were made, and made by some pretty significant companies out there, like Ford, Tesla, and GM. They canceled their allocations and then all of a sudden they’re scrambling to find more.
And when they canceled, there were other companies that were quick to jump in to grab those allocations, and ultimately, it’s led to having to shut down lines because of it. So again, a tremendous financial impact. So, the truth in all of this is being able to quickly identify alternate sources, deal with these quality issues, and plan for lead-time issues. It’s required. And the companies who excel at this and are most proactive at analyzing the possible issues and are able to get ahead of these disruptions, reap the benefits because they don’t have to shut down the lines.
They can hit their commitments. And of course, in all cases, leveraging the data is critical to that strategy.
Gregg Gowanloch
And as we get into the fourth element, this is another one that hits home for a lot of our customers. It’s this notion of how do we really partner with our customers for the long term?
Gregg Gowanloch
And it really all comes down to your ability to anticipate customer demand and partner with them to address those demands and proactively guide them towards the future. So many of our customers are really, in terms of this question to have in the back of your mind, “What is a best-in-class company noted for, both internally and customer-facing?” And so, a lot of it comes down to being as transparent as possible with that end customer.
I have countless examples of customers, during their customers coming in and auditing them, being able to volunteer out and clearly demonstrate that their company’s standard operating procedures and requirements are being followed to a tee. And, “Hey, we’re happy to show this to you. We’re happy to explain how we’re protecting the IP of your product along the way.” So, being able to give customers the assurances that what you’re doing, at all facets of product development, is being adhered to and you’re protecting their IP, really expanding the customer experience.
So, being able to involve customers and provide them visibility at the drop of a hat of where you’re at in the product development lifecycle. Be able to freely share information along the way. That’s huge, it gives comfort to the end customer that we’re progressing through our contract, or our product development efforts, nicely and we’re going to hit the targets. In many cases, we might exceed those targets that we set.
So, exceeding those expectations. And then just, along the way, what are we doing to ensure that there are backup plans in place, just in case something goes wrong. We are thinking about alternate sources, so if there is a supply constraint, don’t worry about it. We have you covered. And those types of things. So, it’s really being able to demonstrate at the end of the day just best practices to customers and being able to ensure that you’re leveraging the right tools at the right time to meet those customer demands.
All right, poll three.
Heatherly Bucher
Yeah, let me launch this poll. We would love to know, for those who are live attendees, what regulatory governances you need to meet right now, or maybe in the future. So, you should see a third poll up there while Gregg talks about the fifth imperative.
Gregg Gowanloch
Perfect, and that’s a great segue into this fifth imperative. We’ve talked a lot about leveraging the data, empowering your remote workforce, enhancing supply chain resiliency, and really anticipating your customer demands.
Gregg Gowanloch
But how do we do that today, and all the while establish this notion of a compliant environment? It’s not even a notion as much as an imperative. You have to be compliant. And one thing that we know for certain is regulations that are in place today are going to change. And then there are going to be new regulations that we’re going to have to adhere to that we know nothing about today. So, whether that’s a year from now, five years from now, 10 years from now, we’re going to have to be flexible and adapt to continue to, once we’ve established a compliant environment, maintain that compliant environment.
So, of course, there’s been lots of them over the years. The UL, ISO certifications. Obviously, ITAR has been a critical one, EAR. And then where we’re heading with CMMC, and we’re on the early rollout and adoptions of that, and it’s all about being able to, when you look at all these standards and directives, if you look at one of the fundamental tenets of them it’s how do we identify, and collect, and maintain that full set of requirements that’s needed for compliance today?
And then, looking forward, how do we future-proof it? How are we implementing it in the company today? And then, maintaining it. How do we plan for that change that we know, inevitably, is coming? And what we’ve seen over the years is key tenets to this is centralizing data. It doesn’t really matter what the regulatory requirement is, it’s always centralizing that data, controlling access to the data, but I think, more importantly, it’s documenting your policies, and how you go about interacting with that data, who has access to that data, what types of controls should be put around that data.
And so, it’s all of these policies and procedures that are intertwined and, at the end of the day, lead you to the ability. The companies that do this best figure out how and where do we centralize the data? We’re going to document our processes, and the tools and technologies that we use around those processes are really enabling us to be compliant and to address customer requirements and exceed their expectations.
And the companies that do this really well figure out how do we do this without really taxing the organization? How do we do this without having to add a ton of headcount to oversee being compliant? Because at the end of the day, as long as you can say and illustrate that you’re compliant, that’s what matters. It’s not, “Hey, we got an extra gold star for being extra- compliant.” So, it’s the efficiency in which we become compliant that’s really critical.
Perfect.
Gregg Gowanloch
So, one of the things that we’re going to transition into is … I’ve been talking a lot about what we’ve been seeing and what we deal with day-in and day-out with our existing customers and prospective clients, but really what I want to focus in on is how Arena enables our customers to execute on delivering great products and innovating on newer technologies all the time, everywhere, no matter location.
And so, we’re going to go through and we’ll talk about Arena’s capacity to do this and help companies.
Gregg Gowanloch
So first and foremost, Arena has been in business for 21 years. We’re a market leader with over 1,300 customers, primarily in high-tech electronics. Medical device, life sciences, and of course, aerospace and defense. The common theme across our customer base, though, is high rate of innovation across our platforms, interconnected technologies, typically, outsource manufacturing, and really complex products from the standpoint of their mechanical design in nature.
Gregg Gowanloch
There’s electrical elements, software/firmware elements.
Gregg Gowanloch
And they’re doing this, bringing products to market in a highly regulated environment. So we are an enabling technology for our customers on a global scale. Most of our customers leverage an outsource manufacturing strategy that we talked about. They have global supply chains, and they have worldwide both development centers and customers. So they need to be able to have access to their information to drive their product development, basically, 24×7, 365 days a year, and Arena does enable that.
And the most common thing that we’ve helped our customers with over the past 21 years, and we talked about it earlier, is moving them progressively further up and to the right.
Gregg Gowanloch
If you remember that “leverage the data” slide we covered early on, and it’s moving them from the siloed pockets of team-centered kind of data vaults and repositories of information, and then all the controlled chaos in between, in terms of how do we keep all these different teams, whether it’s an engineering team, operations team, quality, contract, manufacturer.
Gregg Gowanloch
Man, how do we keep everybody on the same page and have a concise view of the product information at all times? That’s the universal challenge we’ve been helping companies with over the past 21 years.
Gregg Gowanloch
And what we’ve been enabling is really this notion of a single source of truth.
Gregg Gowanloch
A go-to place for product data and information. So, a lot of this information, and you’re going to see this in a minute with Alan when he gets into the demos, how do we centralize things like mechanical and electrical design information? And how do we have clear visibility into approved manufacturers and suppliers of key components and alternates? And then, as importantly, as we make changes to the products, how are we controlling the revisioning events of those products?
The evolution of moving something from early on in a design stage to production. And how are we communicating internally with those changes? So we’ll talk about that, and of course, when the product is out in customers’ hands, how are we proactively dealing with and addressing quality issues that inevitably do come up? Of course, there’s lots of technology companies out there.
Gregg Gowanloch
Lots of solutions in this marketplace, but clearly what has set Arena apart over the past 21 years, and the reason why we are considered the leader in this complex medical and high-tech electronics and aerospace and defense industry, is our solutions are purpose-built.
Gregg Gowanloch
They’re business-ready applications and, end of the day, that means that our customers can get up and running and getting value out of Arena much quicker than the alternatives that have been in place today. I think, more specifically, here. We’ve seen, specific into the aerospace and defense industry, we’ve seen companies like the Boeings of the world and Lockheed Martins of the world, they’ve been able to invest multimillions of dollars in technology infrastructure and like systems, but it’s carried a huge cost and a huge deployment effort.
So Arena’s been able to do similar systems for a fraction of the cost, and a system that doesn’t take an army of folks to maintain. And then, we’ve centered around the ability to do this securely and in a scalable manner. So, no matter what somebody’s internal role is, we have the access controls, and the policies and procedures in place, to be able to support that secure access.
So, in other words, enable that remote workforce, and because it’s cloud-based it’s a collaborative environment.
Gregg Gowanloch
And the key to our strategy, really, in this market segment is aligning with where the federal government has allowed companies and has taken the strategy, and that strategy is to really embrace cloud offerings and embrace them because they are more secure. They tend to be more secure, and we can confidently maintain compliance in these environments.
We can reduce risk, and we can reduce the burden on our IT organizations by leveraging a modern cloud technology platform. But the benefits of that, that come with that, is it’s always current, it’s always up to date, and there’s always somebody monitoring it to make sure that the latest patches are installed and things like that. And it just becomes a more scalable environment to operate from and transform your business from.
I’ve talked quite a bit about Arena’s presence in a variety of high-tech in medical device and aerospace and defense sectors, and there’s a lot of commonalities between these companies in terms of the types of products that they’re bringing to the marketplace, but to give you an idea of some of the companies that we’ve partnered with over the years.
Gregg Gowanloch
And of course, within the defense sector specifically, some of these customers are highlighted, like Spectranetix and Orolia, Bestronics on the manufacturing side, and so forth.
Gregg Gowanloch
So, at this point, I want to introduce Alan Goodrich—Alan Goodrich is our Senior Director of Solution Consulting—and ask Alan to provide a live overview and demonstration of some of these concepts that we’ve been talking about so far.
Alan Goodrich
Excellent. Thank you, Gregg. I’m going to share my screen out here, and really what my intended purpose is to show how our customers are addressing these imperatives that we just discussed with the Arena platform.
Alan Goodrich
So let me go ahead and do that. Maybe Heatherly or Gregg, just confirm that came up.
Heatherly Bucher
I can see your screen.
Alan Goodrich
Arena login, great. So, the number one imperative that we’ll take a look at—empowering the remote workforce. This is the easy part of the product demonstration. Generally, you’re looking at the IT requirement for users to operate on the platform, which is an internet connection and a web browser. We test and validate on all major browsers, so whether you’re using Chrome, Safari, Internet Explorer, Microsoft Edge, users can get access to the information that they need and they do that in a secure manner.
So obviously, your username and password here are going to get you access to the system and then control what you can see and do. Can you edit? Can you create? Can you approve? Can you review? And of course, as expected, you would see as I go full screen in my web browser here, things like two-factor authentication.
Alan Goodrich
We can enforce IP access controls, where people can log in from. But the people who need it can simply log in and get access to the information that they need.
Alan Goodrich
So they’re going to be brought to a landing page. The system is automatically going to show them things that need their attention, so maybe that’s an approval on a change order, a notice sent from a colleague.
Alan Goodrich
That information is at their fingertips, they’re not digging, they’re not having to memorize a procedure or place to go and look for it.
Alan Goodrich
They simply log in and have access to the information that they need. And so, when we talked about empowering that remote workforce, this is what that really does. Maybe you left a computer at the office, you can log in from home and get the work done. Or as we’ve all seen in the last 12 months, you’re able to enable your employees to continue their work regardless of location. Really, the next thing that we want to focus on then is the ability to leverage the data.
A lot of the things that Gregg addressed were with disconnected and siloed information. My mechanical drawings are over here, our change order process happens in this business system, or maybe through email. Our electrical and software teams work elsewhere. And then we’ve got procurement and quality teams operating in their systems as well. With Arena, customers are able to pull up quickly a product, a part, a process, and have immediate visibility into current status, history, as well as things that may be coming down the pipeline.
So what we’re looking at here is a sample product. This is a communication navigation system. We’re seeing the top-level here. The current effective revision being displayed, and I started here on the fully indented bill of material because I think this is a great representation of really how far this leveraged data can go. So if we look into the bill of material for this product, we’re seeing more than just the hardware, so if there’s a power supply that comes with this, packaging, artwork, labeling information, you can have access to that.
You’re ensured you’re looking at the latest approved version, the revision value. If you need access to the files themselves, they’re over on the right. So it could be a drawing, could be artwork, could be the label. Into the actual hardware here, we’re going to have mechanical and electrical subassemblies, so the gasket, the front housing, back housing assembly. Perhaps we have a printed circuit board embedded on that PCBA. We’ve got our caps and resistors, all the way down to, let’s scroll here, firmware, and perhaps we’ve got our embedded source code or binary file attached.
And with each one of these components in our bill of material, we’re seeing the latest effective information, so what’s the current value? And again, as I mentioned, the files attached over on the right. But also, we’re having visibility into the pending workflow, so are there changes coming down the line that are going to impact that part you’re looking at? Are there open requests or quality issues? All of this is leveraging Where Used knowledge that’s inherently native to the system, so if someone in operations or quality control flags a part of the nonconformance, a design engineer is going to be made aware of that.
So again, for customers that have complex product portfolios, a lot of commonly used parts, a disconnected siloed environment, this is very hard to do. And instead, in Arena I can log in from anywhere, have access to that key information and make timely decisions and avoid things like delays, scrap, rework, and just general time that it might take to run down this information. Instead, leverage the data, it’s all right here at your fingertips. The next thing we wanted to look at is really enhancing supply chain resiliency.
So we’ve got all this data in here, we know we’ve got the right design information, we’ve got a solid understanding of our change control process, but a lot of our customers outsource some element of the design or manufacturing process to Arena. And so, they’re going to control those sourcing relationships. Every item might have a sourcing tab. I could view a sourcing bill of material here on a product itself. Maybe down at the hardware level, this is where we might actually be sourcing, you can see Flextronics, maybe Trilby, Sanmina listed.
If I drill in, I might see those under the sourcing tab for the actual hardware here. Maybe we’re outsourcing the assembly for this finalized product. With a single click, I can view who might have access to this. So, very easy in Arena through a secure supplier sharing model, and really that’s at the license level. It’s not a separate portal, it’s not poking holes in a firewall. I can provide our key contacts at Trilby, in this case, with access to view this item.
Maybe they need to get the latest bill of material, get access to the latest drawing. Securely, accurately, quickly, we can bring them into the same environment. Again, not having to create a siloed system of record that doesn’t get updated sometimes, takes too long to get through. Now they’re right here with us. Beyond just the product data, this is going to extend and come back up the chain here with our Where Used report, to our product that we were just looking at. This supply chain resiliency is going to extend into things like the change order process.
So if we take a look at a change order here, this is out for approval looking to address an overheat issue. I’ve got that same supplier access tab. If I need my contract manufacturer to sign off on this change because it’s critical, I can do that right here in the system. In this particular change order, if we took a look at the redlines of what was happening here, you can see that we’re trying to address an overheat problem. We’re introducing a new fuse, we’re improving ventilation on the back housing, we’ve got a new drawing there.
We’re swapping out a component on the printed circuit boards, we’ve got a new schematic and we can redline the BOM and see that switch happening. This is being driven by a quality event. That quality event here, listed under our corrective action, can also be part of communication to supply chain. Maybe they’re the ones that reported it in, or maybe you need their acknowledgment. So our quality event here has supplier access as well. Perhaps we’re bringing in our contact at Trilby here. So that’s really, across the board, how you can enhance that supply chain resiliency.
Get them into the same system of record with you, collaborate with you effectively, but most importantly, securely—so that you can get key changes through our quality processes like we’re seeing here. Next, I want to take a look at requirements and meeting customer requirements. So, in this same storyline, we have this overheat issue. We’ve addressed it via that corrective action that we were looking at where we’re going to change the product design.
Let’s take a look at the preventative action measures. In our standard process, after corrective action when we’re issuing that change order, we want to look at preventative action. How do we stop this from happening again in the future? So, we might see here some examples where maybe updates to some SOPs are taking place. Maybe we’re writing new requirements for future tests on future product lines. And this could also trigger things like training records to occur. And so, in the case of customer requirements, maybe we’ve caught this problem.
We’ve identified, “Hey, if we change the manufacturing process this will prevent, and if we add in a test requirement we’re going to catch this and prevent a recurrence. So let’s introduce that to our new requirements that we’re working with for our customer.” So, Arena has requirements management, where we are maybe detailing out all of the NPI requirements, from business, to product, to hardware and design, electrical requirements, mechanical requirements, all the way down. And what’s great about this, just like we saw with quality, this is going to link back to your product record.
So in addition to seeing traceability from requirement to requirement, I can see the product that this is going to be linked directly to. And this is really how we’re going to meet customer requirements. Perhaps they’re providing this to us. Well, if I’m loading and controlling those requirements here in Arena … Again, you’re an engineer, you’re working on a product, you’re going to see that traceability as to what’s driving the features and functions that you’re looking at and designing. Lastly, driving a compliant environment.
As Gregg alluded to, this can encompass a whole lot of things and we’ve touched on several of them here today, including login capabilities, privileges and roles, and securely sharing information with suppliers. But also, as we’re looking at this particular bill of material, I want to point out basic things like scrolling down to our printed circuit board assembly here, and over on the right … Actually, let me switch views to our indented view again.
And coming down to that printed circuit board assembly, over on the right, this column represents requirements for compliance. So, things like RoHS, WEEE as you see here, conflict minerals. If there’s documentation that needs to be in place for parts, for products, for assemblies, this is a great place for that. Now, I can see across a component, do you have the evidence required to satisfy that compliance requirement? So in this case, for RoHS, do we have the CoC from the manufacturer loaded?
On that part record, I can see it right here and this flag is indicating that we’ve met that requirement. So quickly, easily, again, get it into a system of record. Now compliance data is not in a separate siloed system. It’s right here. We can understand, are we production-ready for this? But in addition to that, in terms of compliance, we can also look at simple documentation. So, in our assembly here, we’ve got a user manual. That user manual, you can see here, is pending approval release.
This user manual perhaps might be part of an overall training plan. So Arena also has training capabilities. So, your SOPs, user manuals, instructions for the shop floor. If those are going to be updated via a change order, it can automatically tell the employees that need to retrain to that procedure and record that happening in Arena. Now you have, again, a single system of record for audits, internal training, to understand, did that get done, and are we operating in a compliant manner?
So I’m going to stop my share, that was the intended overview.
Alan Goodrich
And turn it back over to Gregg, Heatherly, and the team.
Heatherly Bucher
Thank you so much, Alan, for that great short demo of what Arena can do. I always get excited when I see the product, but also when I see your demos in particular.
Heatherly Bucher
We’ve got some questions, and I’m going to introduce our panel in just a minute.
Heatherly Bucher
But I just want to do, really quickly, the giveaway.
Heatherly Bucher
Like I said, if this is your first time joining an Arena event, we do love our customers and we like to share some of their fabulous products to kind of brighten everyone else’s day. If you become an Arena customer, this was kind of a common thing they do at customer events, but occasionally we do it for future customer events as well, like today. And as I mentioned, today we have a Sonos One player, although I have Sonos envy because they just released the Sonos Move yesterday, after we made these slides.
So if the winner wants to swap and you want to get the Sonos Move instead of the Sonos One—Sonos Move is a new little portable Bluetooth—then we can do that. Going through, just picking random. Actually, I had someone else pick. Our winner today is Derek S. And Derek, I will get in touch with you later via email to get details to get that out to you and see if you want the brand new portable one or if you want the Sonos One. Now, I want to roll into, last 10 minutes or so, our questions.
Heatherly Bucher
But before I do that, in addition to Gregg and Alan, we have two of our subject matter experts from our larger team with us and I want to introduce them really quickly.
Heatherly Bucher
Mark is a Senior Solutions Architect for Arena.
Heatherly Bucher
He has many years working with our high-tech and defense customers. In particular, defense customers, some of our largest defense customers today. Mark is the solution architect for them. In addition, Mark’s previously worked in the defense electronics space at Ball Aerospace and really understands the unique challenges defense supply chain participants face. And then Jeff. Jeff Baer is our Director of Security Engineering. He has decades of experience in the areas of information security, audit compliance. Prior to joining Arena, he spent seven years in financial services, a highly regulated environment, obviously.
And over 10 years as a leader at Coalfire, which is actually one of our partners for 3PAO, and there he provided assessments in cybersecurity advisory services to customers across various industries. We do have some questions and I did answer, by the way, if you are joining us live or even on the recording, you’ll see answered questions that we answer by type in the Q&A. So, I did answer one question about where we host our GovCloud solution, and I typed that in, and the answer is we use AWS GovCloud for our GovCloud solution.
But let’s take a look at some others that we’re going to answer live. So, the first one. Jeff, since you’re perfectly suited to handle a couple of these, one that’s come in is, “Is Arena ITAR certified?”
Jeff Baer
Yeah. So there’s not specifically an ITAR certification, but yes, we do have an ITAR program in place. Again, as Heatherly just mentioned, we had a 3PAO come in and help guide us through that process to make sure that we are meeting or exceeding all the requirements. So we have, obviously, processes internally for managing the systems and ensuring ITAR compliance. And then we’ve, again as Heatherly mentioned, selected AWS GovCloud, which obviously has ITAR compliance as well as FedRAMP and many others.
Jeff Baer
So yeah, hopefully, that answers the question.
Heatherly Bucher
No, perfect. And we have another question that I think, Jeff, you could probably spend the rest of the time we have. But at a high level, Gregg shared that there’s a lot of changes that go on in the regulatory space, of course, that our customers are subject to, as well as that we watch. And Gregg mentioned a little bit about CMMC, and I know some of our customers are still learning about it. But the question we got from one of our attendees is, “What are we doing with regards to CMMC, DFARS, FedRAMP, these newer defense space regulations?”
Jeff Baer
Of course. So, DFARS was the first one we implemented, and that’s based on the NIST SP 800-171. It’s approximately 110 control requirements. We then picked off programs last year for both CMMC and FedRAMP. So FedRAMP, we are on track for FedRAMP moderate compliance by the middle of this year, we believe we’ll be able to state compliance there.
Jeff Baer
And then, CMMC, as some of you may know, it’s an evolving set of requirements and controls and there’s still things changing as it relates to, I should say, the audit requirements, et cetera. But for us, we’re doing CMMC level three. It adds about 20 control requirements on top of the DFARS NIST standard that I referenced earlier, and we expect to be prepared to call an auditor to come in and perform that CMMC audit towards the end of this calendar year.
Jeff Baer
So, a lot of activity in CMMC and FedRAMP, and then again, DFARS, the program is solidly in place today.
Heatherly Bucher
Great, Jeff. I appreciate it. I think one of the things that I know our customers are always amazed when they talk to Jeff directly is the level of detail and activity that we do constantly with regards to our standard operating procedures and other process-based activities, not just the architecture for AWS GovCloud, for example. Not just our solution platform, but everything else that goes behind it, that our teams are involved in, our processes.
It’s a lot of work that Jeff heads up. Mark, I’ve got a couple of questions for you because you, of course, work with our defense customers all the way through implementation and beyond sometimes. And so, the first question is a little more generic, and then we have one that’s a little more specific. The first question is, how do we make sure who has access to the system? How flexible is it? How restrictive is it?
Mark Andres
Access is obviously a very important component, especially when you’re talking about your intellectual property in this space. Arena has gone through and is still evolving in that area, to continue to grow and mature in the access area, but primarily the first thing that comes to mind is the Arena Access Policy, which was introduced just a few years ago. The access policies allow you to create very granular controls over your data.
Mark Andres
Who can see what information, and even what parts of that information do they have the ability to see or not see? And if you’ve used access policies before, you’ve seen that we’ve been maturing that, even to the attribute level where we can have key attributes to help trigger those levels of permission versus our old access roles, which you had no ability to modify them whatsoever. So, specifically, our ITAR customers are all migrating.
Mark Andres
Actually, if you just start right out using the access policies. And every world in Arena has those policies, even to the file level. Files get to be very, very sensitive and so it can control who has access to those files and not. A couple of other areas that help you, and again, we continue to mature these, are in our Arena Administration module we have a whole set of recent activity reports. Those activity reports stem all the way through user access. Has the user exported data from the system?
Mark Andres
Have they run and executed a report? Have they also accessed a file? And every one of those also have additional filters around them where, was it an employee that accessed that information? If you have hundreds of employees, and then you have some partners, and you might have some integrations running. It could be difficult to sift through all that information, so under the recent activity reports you’ve got the ability to set those filters. Even whose access was denied and where did that denial come from?
Mark Andres
And the last area that’s a little bit light is also around Arena’s standard reports. If you go to your report world, there’s one called user access history report and that can give you a complete listing of all the users, or by user name, when they accessed the system, how long did they access it, et cetera.
Heatherly Bucher
Wonderful. And then, another question actually just came in about integration processes with regards to transitioning from those multiple databases when we implement, Mark, and they have data in various places. What does that process look like at the highest level, what are the steps to work with the customer, identify those legacy data sources, and then get that into Arena for Arena to be the sole source going forward?
Mark Andres
Yeah, sure. That does definitely increase the complexity in implementation. Taking into consideration your part numbering, do you have any part number inclusions? How about suppliers?
Mark Andres
And that’s one of the more common issues you run into, with supplier naming conventions. So normalizing and consolidating the data can obviously increase the complexity of that. But we’ve done that numerous times and continue to improve upon that process as we engage in further opportunities.
Heatherly Bucher
Great. We’ve got a few more questions. I answered a few privately, and we will follow up with typed-in answers. Actually, I think we got another question. Alan answered one or is answering one, I think, in text. So, do check the Q&A window there so you can see the questions, but we are out of time.
Heatherly Bucher
So, I wanted to conclude and thank you all for joining us today.
Heatherly Bucher
We hope you’ve learned something new. Perhaps you’ve become excited about what your team could do with Arena. A recording of this event will be made available to you shortly. You’ll get an email with a recording link, and we also have a one-page planner that you can use to assess where you are in these five imperatives. Kind of a health check, if you will, about you and your team and these five imperatives that Gregg talked about. If you want to talk to Gregg more about Arena, or get a custom demo or a trial with Alan’s team, feel free to reply to that event recording email or reach out to us directly and we will be happy to have that conversation with you.
We do have a couple of great tools on our website that I wanted to highlight. They’re both new, but they have become very popular with our future customers. If you want to start a dialogue with your team about the costs of everyday mistakes, we have a calculator. It’s kind of a fun thing to do while you sip your coffee in the morning. You can put in your own information, we don’t see any of it. But you can play around with the calculator there, put in information about your team, your product, your NPDI cycles, and then pick some scenarios of things that maybe, unfortunately, have happened to your team in the past, or things that you’re worried about in the future, and it gives you a realistic view of what those mistakes can cost.
And, if you need help getting the right software for you, we have a definitive guide on how to buy software, any software. We put this together collaboratively across our teams, who have a wealth and depth of experience in not just helping customers select software and implement, but also do so ourselves. And so, we feel very confident that if you need a guide on how to buy software for your team, whether it’s PLM, QMS, ERP, CRM, or anything else.
You’ll find that on our website as well. Thank you so much for joining us, and we hope you all have a fabulous day.
Mark Andres
Thank you, everybody. Cheers!