In search of excellence; How to grow in a cash consuming world · SECURITY1 Name of the...
Transcript of In search of excellence; How to grow in a cash consuming world · SECURITY1 Name of the...
SECURITY
Name of the presentation 1
In search of excellence;
How to grow in a cash consuming world
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1. Aircrafting signed by Fokker
2. Typical Business Models. How to compete in a capital
intensive, global game
3. The journey of Fokker Aerostructures
4. Conclusions
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Fokker Technologies Super specialist based on rich heritage of aircraft manufacturing
1911 1996
…delivered
leading innovation
that shaped the
aerospace
industry…
…manufactured
high quality
aircraft that
stood the test of
time…
…with over 500
aircraft still in
operation today
#2 in wiring systems #1 in tails for business jets #1 in out of production support
2013 Fokker is involved in 75 Aircraft platforms resulting in Fokker’s
signature on over 14,000 aircraft today
Anthony Fokker Aviation Pioneer
1890 - 1939
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Revenue Mix
2011
2015
Balanced Portfolio Fokker has a semi captive program portfolio across 75 aircraft platforms
from design through life time support
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Balanced Portfolio Across Program Lifecycles
Dassault SMS
Trent XWB
C-series
A350 XWB
A400M
A320NEO
G650 P-8A
JSF
A380
NH90
Dassault 7X
Hawker P&WC
Cessna
CJ3 / CJ4
ARJ21 C919
Apache
Cessna
Sovereign
B777
B737
A320
G550
Dash8-400
CRJ
Patriot
Chinook
F-16
C-17
Fokker
A300/A310 C919
NH90
B737
Dash8-100/200/300
CRJ 100/200
Fokker
F-16
2011 c. €28m
4.1% of
total revenues
2011 c. €253m
37.0% of
total revenues
2011 c. €208m
30.4% of
total revenues
2011 c. €195m
28.5% of
total revenues
Design-build Redesign - modifications Sustainment
Aircraft platforms in Fokker
portfolio in build life cycle
Aircraft platforms in Fokker
portfolio in support life cycle
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Typical lifecycles, Different cash models operated Typical lifecycles in Aerospace are over 30 years and take serious upfront investments, Fokker is
therefore changing its business models
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Traditional model Asset light model Services model
Key aspects
• Traditional design-build models
requires supplier to invest in design
phase
• Risk of delay in development
phase is with the supplier
• 25 to 40 year program involvement
Key aspects
• Asset light model, based on
customer financing and
prepayment of design phase
• Risk of delay in development
phase is with the customer
• Investments focus at working
capital build up at start of low rate
production and assembly (similar
to build to print)
Key aspects
• Current profile for out of production
Fokker fleet
• …moving to other out of production
aircraft will require stock
investment, offset by recurring
turnover
• Gaining foothold in the installed
base pre-empts revenue build up
full service suit
Dassault 7X
B747-8
A350, CSeries, Dassault
SMS, NH90
A320, B737/B777, JSF
Apache
Dash 8 Q100/200/300
Fo70
/Fo100
Fo50
F27 /
F28
Note: Typical cumulative cash model. Cash development for the Airbus A350 and Dassault SMS is based on milestone payments for
non-recurring cost made instead of traditional amortisation of non-recurring investments
Gulfstream G650
Fokker positions: • A380, Gulfstream G650, Dassault 7X
Fokker positions: • Airbus A350, Boeing 747-8, Bombardier
C-series, Dassault SMS
• Boeing 737 and 777, Airbus A320,
Cessna business jets
• JSF (after delay versus latest Lockheed
schedule), Apache
Fokker positions: • Fokker F27, F28
• Fokker 50, 70, and 100
• Bombardier Dash 8 ‘classic’
A380
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Fokker Aerostructures
• # 1 Dutch defense company
• key defence customers (Boeing, Lockheed
Martin,Raytheon)
• global production footprint
• operation excellence in design&development,
composite manufacturing and complex assembly
Markets Position
Defense (US/EU/SP/LG)
Large Commercial Aircraft
Business jets
• recognized position in design-build, composites
and assembly
• product position concentrated on wing and
empennage assemblies.
• Global Supply Chain (bridge supplier model)
developer
• leading company for design and manufacturing
of major integrated structures (tail sections and
wing components)
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The evolution of Fokker Aerostructures
Building a transparant
and rock solid
organisation
steered by kpi’s,
strong drumbeats
and multi-disciplinary
teams
1996 – 2006: Building
a strong and solid
portfolio
2006 – 2012: Restructure
becoming a growing and
profitable organization
2013 – 2014: Building a
sustainable and
improving organisation
2014 - …. Becoming
World Class
Building a strong
Customer Base
and being back
In business
Turnover: 0 – 200 mio
Turnover: 200 – 300 mio
Profitable and positive
cashflow
Turnover: 300 – 400 mio
Significant EBIT and
positive cashflow growth
Turnover: 400 mio ……
Increase
Maturity Levels
of Sustainable
key processes
and enablers
Being a
high performer
and a high
adaptor
Integrated innovative solutions From production house to
global supply chain
Integral Change approach
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Right to win: Integration of smart solutions It’s not about the smartest innovations…… it’s about the smartest global integration.
Proprietary technologies
World class performance
Configuration management
Type Certificate Holdership
Process innovation
Airworthiness
DOA / POA
Human Capital
Stress engineering
Availability
Airline & aircraft economics
Reliability
3D Design
Knowledge based engineering
Handbooks
24/7
Flight testing
Global reach
Systems, Design & Development
Technical manuals
Aircraft economics
Customer intimacy
Remarketing
R&D
Fokker Academy
Technical training
Quality control
First time right
Paperless
Compliancy
Data analysis
Program management
Low cost supply chain
Experience
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To become a global player…… A clear Make-Buy decission tree is key
Process &
Technology
Contributes to
USP?
Best in Class?
Profitable?
YES
NO
No more investments / future outsourcing
Y
N
Preserve the current state
Operational improvements
Outsourcing
Key technology
Y
N
Develop technology in house
Investments
Alliances with strategic partners
YES
NO
YES
NO
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The Global Game An integrated global approach is key in aerospace
Fokker Aerostructures Global Footprint Architecture
• US$ supply chain • US Defense access (buy American)
Integrated business model
Nth
America
North
America
Nth
America
Europa
Nth
America
China • Central management and HQ • Engineering and technology development • Innovative automated production processes • Dutch defense offset
• Strategic low cost sourcing • Self-propelled (sub-) assembly facility • Defense and commercial offset
Nth
America India
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Execution Excellence
`Our strategic Roadmap drives our improvements, enabled by
an integral change approach leading to firm results`
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Key Area KPI 2007 2011 Finacial Impact
Productivi ty 65% 86% 4 Mio euro Ebit per Year
Effciciency 82% 98% 3 Mio ebit per year
Qual i ty (NC level ) 20 12 5 Mio euro Ebit per Year
Spend reduction 0 16 16 Mio euro Cost reduction
Dol lar Content 22% 46% 40 Mio risk additonal dol lar spend
CLIP On time del ivary 30% 78%
Stockturn 3,7 6 30 Mio working Capti ta l reduction
Overhead (GA level ) 5% 3,50% 4,5 Mio ebit per Year
Operations
Supply Chain
General
Mission Vision Value Drivers
KPI´s Execution
• Throughputtime reduction
• Variation Control
• Yield management
• Machining changed the world
• World Class Composites
• Sheetmetal LEF
• Shakespear Spend reduction
• RLIP CLIP
• Darwin 90 days
• US Sourcing
• Working Capital Program
• Driving Quality
• Global Operations
Integral Changes
SCM Tools
Lean – Six Sigma
CAP Change
Approach
>> Yearly Cost reduction
>> Yearly Cash reduction
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2013
Simplify & Re-tune for next maturity step
180% 88% 31 44,1 6,6 55%
2012
Play Global, Act local: Fokker production
system & Global Sc approach
185% 86% 29 39,5 6,0 50%
2011 Key enablers development: Human Capital,
Technology and Logistic control 160% 87% 29 23,7 5,0 45%
2010 Chain optimization integral Driving quality, Xmatrix MA, fact and maturity scan
driven improvement selection (top and bottom) 132% 87% 25 13,3 4,5 38%
2009 Chain optimization; the basics Designed improvement strategy , Working Capital
reduction program (integral change), shakespear 124% 86% 24 5,0 4,0 34%
2008 Peformance driven and multi disciplinairy
teams dedicated to primairy processes,
6 S 120% 82% 14,5 - 3,8 24%
2007 Leadership(teams), Demand and
Performance Basics in place:ERP system in
place, Basic KPI’s, Drumbeats
105% 78% 3,5 - 3,9 22%
2006 Weeding & Set the Direction: From
production house to Supply Chain Manager 100% 63% - - 3,7 20%
TO (ME)l Prod. EBIT red W.C. red Stockturn % dollar
Design is generating results
- Design (add on concept) in depth 2006 – 2013 -
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Conclusions
• Fokker has made a clear choice to become a specialist,
integrating world class solutions
• Fokker competes in a global market with complex business
models, this drives crucial make buy decissions
• There are 3 main pillars under the Aerostructures Journey: – An integral Change approach, from strategy through value drivers to change
accelleration, measured by clear KPI’s
– From production house to global solution provider
– Smart integrated innovations.
• It is possible to be a Dutch aerospace company with a
sustainable position; Fokker Aerostructures is half way on
this challenging journey
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