Collins Aerospace, a unit of Raytheon Technologies Corp., boasts one of the largest footprints in the aerospace and defense aircraft industry. In fact, it’s safe to say nearly every commercial and defense aircraft and rotorcraft has something with a Collins sticker on it.
“Look at the engine. The nacelles are from Collins. The cockpit holds many Collins products. Look at the seating and the lighting. It is nearly impossible to step foot onto a military or commercial aircraft and not see something Collins does, and frankly, does very well,” said Aaron Maue, executive director for Defense Sustainment for Collins Aerospace.
This vast industry footprint drives everything the Charlotte, N.C.-headquartered company does. And at the forefront lies innovation.
Collins Aerospace, which netted $26 billion in sales in 2019 and employs about 68,000 people, has a long legacy of innovating for aviation. The company traces its history to several founding fathers who invented technologies that revolutionized the industry, including: Arthur Collins, the company’s namesake, who pioneered radio communications; David Sundstrand, who invented the 10-key adding machine; Thomas Hamilton, who revolutionized propeller propulsion; rubber tire industrialist Benjamin Goodrich; Fred Rohr, trailblazer in aerostructures and Paulin Ratier, who developed wooden propellers.
It's this reputation for innovation that led to the largest Supplier Initiated Ordering program in the company’s history — a $34 million contract for sustainment of the U.S. Air Force's (USAF) F-16 and B-2 fleets.
Maue credits the recent win to a talented employee base and a culture of innovation, which led to the creation of the company’s sustainment team in 2018. “We innovate in products, we innovate in capabilities, and we innovate in the way we work with customers,” he noted. “In the sustainment area, we help our customers solve their ongoing sustainment problems.”
Collins Aerospace’s journey to the new USAF contract began in 2017, when the USAF sought help to improve readiness. Hill Air Force Base was experiencing large variations in repair material availability for Collins' Accessory Drive Gear Box. The problems ranged from too many parts in stock to too few — and the readiness rates of its F-16 and B-2 fleets suffered as a result.
The gearbox is a critical part for military aircraft. It acts as the heart of the aircraft’s transmission system, used to change rotational speed. The company decided the best way to help USAF required a departure from the traditional MRO model. In the traditional MRO operation, siloed processes, disparate systems and data overload make it hard to coordinate the entire process, from scheduling and forecasting to inventory management and replenishment.
Collins Aerospace’s newly-created Defense Sustainment team turns this common problem into an opportunity. The team collaborates with the Defense Logistics Agency (DLA) to forecast future gearbox material needs as part of the company’s Beyond Break Fix strategy.
Under the Supplier Initiated Ordering program, a new Department of Defense practice, the DLA provides Collins Aerospace with access and insight into its material demand profile. Collins Aerospace then leverages its proprietary demand profiling process, world-class supply chain management and manufacturing resources to drive an optimized material support plan.
Now Collins Aerospace maintains a guaranteed level of material availability for Hill Air Force Base. The company also rotates all inventory regularly to reduce the DLA’s carrying costs and double inventory turns throughout the performance period.
“This performance-based support approach represents a new level of collaboration between Collins Aerospace, the USAF and the DLA,” Maue explained. “By working together, we devised a solution that enhances MRO efficiency, while improving fleet readiness. It’s the first win under our Beyond Break Fix program, a companywide sustainment and support initiative that focuses on material availability instead of transactional parts, thereby enabling us to better support the warfighter by increasing aircraft readiness rates.”
The Beyond Break Fix Strategy
The Defense Sustainment team is part of a winning venture that began in 2018, when Collins Aerospace was formed through the combination of Rockwell Collins and UTC Aerospace Systems.
Maue explains the program began after a full review of the challenges customers face. Their customers, currently a mix of 40% military and 60% commercial, sought innovative ways to deliver capability and meet their servicing sustainment needs. The examination led to the company’s Beyond Break Fix program, a performance-based strategy that ensures customers have the parts they need to repair their fixed-wing aircraft or rotorcraft, when they need them.
Traditionally, when a customer has a product that breaks, they send it to Collins Aerospace for repair. It could be a four-hour fix, a six-hour fix, or it could take far longer if the part isn’t available. The company does the repair once the part is available and returns it to the customer. “It’s a very transactional behavior, not unlike what we do with our cars,” he said. “But this process limits the value we can provide customers.”
The Beyond Break Fix strategy operates a little differently. The two entities, in this case USAF and Collins Aerospace, share data and work closely to make sure parts are available when they’re needed without customers carrying a large parts inventory.
“They take a broken widget off their airplane or their rotorcraft, and there is another widget sitting on the shelf ready to go into that aircraft,” he explained. “And they can get that highly valuable asset out there doing the work it’s supposed to be doing. With defense aircraft, that’s protecting our freedoms and our safety.”
This is an improvement over the old process. Collins Aerospace’s review uncovered that customers didn’t understand their lead times and were ordering parts expecting them by a certain date, when in fact, the lead times were much longer. “We now have access to data that shows their usage and replacement rates, and their expected mission capability needs. We then combine that data with everything we know about the product, its technical capabilities, how often it fails, and its repair requirements. When we link that to our understanding of our own supply chain, we can help create a consistent, forecastable set of outcomes for our customers that precludes them from having to keep a lot of extra inventory on hand to meet their mission needs,” Maue said.
He added, “Our customers’ job is to keep as many airplanes or rotorcraft in the air as possible and our Beyond Break Fix Strategy helps them do that. We measure performance as our ability to have the right part to customers at the right time, without them keeping a huge inventory that drives their costs up.”
The program works for both fixed-wing and rotary-wing platforms. Collins currently does not have any rotary-wing customers on the Beyond Break Fix program, but “we see the significance and importance of being able to support rotary-wing customers with sustainment,” Maue said. “We already support rotary-wing platforms using the traditional, transactional MRO approach.”
How to Get Involved
Taking part in Collins Aerospace’s Beyond Break Fix program is easy — just ask. The company will review your platforms and how well the traditional transactional MRO model works for your operation.
“We listen to the symptoms they’re having, like a physician listens to a patient,” Maue explained. “As they describe the issues, we start the dialogue and tell them there’s another way to solve this problem.”
Though it can help match parts availability with repairs, Maue admits the Beyond Break Fix program is not for everyone. Maybe the customer has one or two aircraft, or the aircraft are being retired in a couple years.
“When they have a small fleet, we have to get creative when structuring the contract and deciding who owns the inventory,” he noted. “There are a lot of knobs and dials we can turn to make the program work. But sometimes the traditional approach makes the most sense. If they only need enough widgets to keep an aircraft in the air for a couple years, it’s not worth the time and energy to set up a performance-based contract contract like this.”
For those that qualify, Maue says the time is ripe for parts sustainment programs. COVID-19 magnified aviation parts supply chain challenges and companies learned the hard way to expect parts delays. With COVID-19 affecting suppliers, they might order a part and wait weeks because people are out sick, or the company is operating with a smaller staff because business took a dive.
“You can imagine the problems this might create,” he said. “They used up the last of their supply of a part, then placed an order and found out there was a long lead time. They might even run out of the part before new inventory comes in. Our program eliminates bumps in the road from supply chain interruptions.”
Ronnie Wendt is the owner of In Good Company Communications, a Waukesha, WI-company that specializes in writing about aviation-related topics.