Top MRO Leaders Share Their Wisdom: STATE OF THE INDUSTRY

Dr. Johannes Bussmann Chairman of the Executive Board, Lufthansa Technik

As an industry, from your perspective, how is commercial MRO doing (what is the state of the industry)?: I cannot remember the last time the aviation industry experienced a dynamic on such a scale. Thereare more new aircraft types with new technologies, materials, components, and engines entering flight operation now than for decades. Due to these new developments, aircraft, components, and engines are more reliable and require less maintenance. At the same time, manufacturers are also increasingly competing in the service business and competition among traditional MRO providers has become more intense, too. This of course has major consequences also for the MRO market, which on an overall level is continuing to grow, primarily in Asia and South America, despite the serious ongoing cost pressure being experienced by the airlines.
What do you consider keys to success in MRO?: Apart from competitive prices, key factors in determining the success of the MRO business in the future will be the abilities to help shape the market and meet the challenges of global competition. This includes a global location network, for example, which can offer customers regional services as well as new partnerships and development of innovative technologies. Lufthansa Technik’s goal is to continue to play an active role in shaping the MRO market in the future, too.
What trends are impacting or will impact MRO in the near future?: New materials and the development as well as automation of appropriate repair or production processes are important keywords in this respect. Moreover, digitalization in the sense of paperless maintenance and increased use of mobile applications is a major topic. The combination of collecting, analyzing and use of large volumes of data is a further essential trend that is set to change our industry significantly in the coming years.
How will Big Data impact MRO? Is Big Data being used by your company and, if so, how is that improving your business?: “Big Data” is a mega trend of our industry. To manage and shape this topic successfully is crucial for our future success. Therefore we are active in a number of areas, for example in the development of preventative and predictive measures in component maintenance. Also airlines have to use their data more intensively in the sense of self-optimization and have to understand that this data belongs to them and not to the manufacturers.
How will additive manufacturing impact MRO (give examples of how your company is using additive manufacturing in MRO, if applicable)?: dditive manufacturing will also be used more intensively in our sector in the future. At Lufthansa Technik we are currently looking into the possibility of using the technology with the goal of supporting cost reductions for our customers, for example through weight reduction or component improvements in order to extend durability.
How does your company encourage innovation?: Lufthansa Technik has been involved in developing a wide range of innovation activities in recent years. These include, for example, a central innovation management, numerous R&D projects with a three digit million amount of invested money, which are carried out in-house or also with external partners from industry and universities. Other examples are Lufthansa Technik’s participation in the Hamburg Center of Applied Aeronautical Research (ZAL), a new business division “Original Equipment Innovation,” and internal innovation days to promote the idea exchange within our organization. Last but not least, we are evaluating co-operation possibilities with start-ups/companies from other business sectors, in order to think outside the box and to develop new approaches to the benefit of our customers.

Kevin McAllister President and CEO, GE Aviation, Services

As an industry, from your perspective, how is commercial MRO doing- what is the state of the industry?: The industry health indicators remain positive with strong global traffic growth and capacity adds in line with demand, resulting in strong airline load factors. From an MRO perspective, we see steady shop visit growth. The combination of low fuel pricing and traffic growth is also a tailwind for current generation and mature fleets. This is reflected in the significant drop in aircraft retirements in 2015 vs. the 2013 peak and in the net return of 100+ parked fleet into service last year. So the macro indicators we watch are generally positive.
What do you consider the keys to your company’s success in MRO?: It boils down to our commitment to our airline, leasing and MRO customers to provide the lowest engine cost of ownership throughout the lifecycle. Our continuous investment in technology enables new engines like GEnx, the CFM LEAP and GE9X to achieve the double digit fuel burn improvements, as well as the reliability and durability improvements our customers expect. These learnings also enable upgrades back into the installed base that improve fuel burn, reliability and time between shops visits through the lifecycle. This is good for airlines and MROs because it keeps GE and CFM fleets flying cost-competitively, and it improves engine residual values. Our commitment to customers also means we need to understand their unique expectations and challenges so we can better simplify how we do business and tailor our offerings to meet their evolving needs. This simplified, customer-centric approach is the catalyst for the recent launch of our TrueChoice suite of customized service offerings throughout the lifecycle for our airline, lessor and MRO customers.
What trends are impacting or will impact MRO in the near future?: This is an exciting time as new, more efficient aircraft and engines enter the market and as airlines and leasing companies globally redistribute cost-competitive used aircraft. These transitions in aircraft ownership create new opportunities for MROs. Customers expect services offerings tailored to their unique needs throughout the engine lifecycle. TrueChoice Flight Hour provides a wide range of flexible risk transfer options to minimize lifecycle cost. TrueChoice Overhaul provides time and material shop visits with customized workscopes. And, as aircraft and engines move between operators, TrueChoice Transitions includes offerings developed for mid-life to mature engines like engine exchanges, green time leases, customized workscopes with shorter builds, and lessor portability products. Finally, customers want freedom to choose an overhaul provider. We’re committed to a competitive MRO model that includes a full range of MRO providers. TrueChoice Material offers a suite of material options for these MROs, including OEM qualified new parts, component repairs and used materials.
Is Big Data being used by your company and, if so, how is that improving your business?: Absolutely, but the value here is in the marriage of analytics and physics. Today we are working together with GE Digital to unlock data trends through better analytics coupled with our engine expertise. The combination of analytics and physics drives more predictive intervention, reduces maintenance burden and improves reliability and fuel. This is good for customers and GE. The investment in GE Digital’s Predix, a cloud- based, open-source platform, provides an enabling infrastructure to effectively harness the rapidly-growing volume of data across the industry.
How does your company encourage innovation?: Innovation is a big piece of our DNA. It is centered in our investment in technology to deliver products and services aligned with our customers toughest challenges. We work hard to foster a collaborative, learning culture and to leverage the best ideas from across our business. I believe our focus on digital and on simplification will help us do this faster and more efficiently.

Franck Terner Executive Vice President, AIR FRANCE KLM Engineering & Maintenance

As an industry, from your perspective, how is commercial MRO doing (what is the state of the industry)?: Our industry is experiencing major technological changes, which create the need to constantly adapt and develop technical skills. More than ever, the latest generation of aircraft entering fleets are computers with wings. This translates into e-operations and big data opportunities. There is also a wider use of composites, which we anticipated by opening last year a cutting edge aerostructures facility in Paris CDG. In recent times there’s been the impact of consolidation. In the market, there are now bigger airlines and bigger OEMs than there were before. Size counts when you are dealing with majors. In areas such as OEMs licensing schemes, our profile as an airline and MRO combined with our long standing relationship with OEMs helps us to cope with this for the benefit of our customers, who want to have a choice when it comes to selecting a maintenance support provider.
What do you consider keys to success in MRO?: Airlines are facing continuous changes. In this perspective, deeply understanding their needs is a must. Being an airline ourselves, we experience the same challenges and we are well placed to offer adaptive answers and to share the cost effective solutions we are putting in place on the maintenance field. Developing our worldwide MRO network allows us to answer the increasing need for competitiveness, proximity and dedication. Another key is the ability to innovate and to put in place up to date capabilities. That’s why we invested more than €400m in the last decade to modernizing our industrial base. As an example, based on our cutting edge facilities we were able to smoothly and quickly introduce GEnx engine maintenance capability.
What trends are impacting or will impact MRO in the near future?: We already see the impact of the current trends: new technologies, e-aircraft, consolidation… This results in a need to offer creative solutions to meet market expectations, and to innovate. It is what we are doing with comprehensive parts provisioning schemes, from advanced repairs to tear down and trading; new cabin modification solutions; research & development… On the airframe maintenance business, lower men-hours may result into a more regionalized market for new generation aircraft.
How will Big Data impact MRO? Is Big Data being used by your company and, if so, how is that improving your business?: The most obvious opportunity brought by big data is predictive maintenance. As an airline we know how much we can save by avoiding operational disruptions. Anticipating a part’s failure will contribute to the whole airline continuity.
An example of successful analytics we’ve developed on the A380 is the fuel system. For the 787, we will start applying predictive tools to the cabin air system. This knowledge will be highly beneficial to our 787 and A350 customers.
How will additive manufacturing impact MRO (give examples of how your company is using additive manufacturing in MRO, if applicable)?: Additive manufacturing is helping us to be more agile and to create tools and prototypes faster than before. One challenge remains to accelerate the certification process for parts installed in the aircraft. For large quantities, traditional production methods can remain cheaper.
How does your company encourage innovation?: In 2015, AFI KLM E&M has launched “The MRO Lab”. This is an ambitious innovation program which encourages the dynamics of innovation at all levels: employee participative innovation programs, partnership with start-up incubators, universities etc. In February 2016, we opened a co-innovation center in Singapore together with Ramco.
The MRO Lab is already providing new tools and knowledge to propose simpler, easier and faster maintenance solutions for our clients.

Matthew Bromberg President, Pratt & Whitney Aftermarket

As an industry, from your perspective, how is commercial MRO doing (what is the state of the industry)?: I see two major shifts happening in the MRO industry. First, as next-generation engines enter the market, MRO must evolve to incorporate high-tech solutions to service these innovative products. In the last 10 years we have invested more than $300 million in repair R&D with more than 300 dedicated repair development engineers yielding more than 25,000 part repairs. We are also incorporating new data collection capabilities, such as our eFAST system available on the Bombardier C Series, which is an onboard, near real-time integrated data acquisition and transmission unit that automatically downloads, processes and stores data, then securely uploads it to a customer portal. Second, in the past few years, operators have shifted their maintenance strategy from a traditional transactional approach to a more long-term focus supported by fleet management programs (FMPs). Pratt & Whitney managed engine fleets provide customers with predictable maintenance costs, 20 percent longer time on wing, the highest levels of reliability, and 20 to 50 percent higher residual value.
What do you consider keys to success in MRO?: The keys to success in the MRO industry are quality, speed and value. With a global network of 19 high-tech, high-volume MRO facilities and more than one million part repairs completed each year, Pratt & Whitney provides the highest value service on Pratt engines. The most important component is providing aircraft operators with the flexible and comprehensive services they need. Pratt & Whitney provides long-term fleet management programs to transactional engine overhaul and part repair, innovative asset management solutions, new and used serviceable material and a pool of 200+ lease engines.
What trends are impacting or will impact MRO in the near future?: The biggest impact to the MRO industry in the near future will be the surge of next-generation engines coming in for their first overhaul. Over the next 15 years, it is anticipated that there will be more than 45,000 regional and mainline jets in operation and two-thirds of these will be powered by next-generation engines. These high-tech engines will require high-tech repairs, such as innovative processes and coatings to repair fan blades and HPT airfoils, to improve part durability and establish optimum blade tip clearances for better performance. Pratt & Whitney also is building an IT infrastructure to facilitate sharing information amongst our network.
How will Big Data impact MRO? Is Big Data being used by your company and, if so, how is that improving your business?: Big data has been impacting MRO for years. At Pratt & Whitney, we’ve been capturing and analyzing data on our 13,000 installed commercial engines for decades. Now, with the help of new collaborators and new technologies, we are investing in data analytics to optimize our customers’ operations. By leveraging big data, we will be able to plan maintenance, and schedule and mitigate engine removals without compromising reliability. We allow our customers to focus on their business and we keep the engine flying.
How will additive manufacturing impact MRO (give examples of how your company is using additive manufacturing in MRO, if applicable)?: Pratt & Whitney will be the first to use additive manufacturing technology for production parts, including compressor stators and synch ring brackets, in new jet engines that will enter service on the PW1500G engine for the Bombardier C Series aircraft. We are a leader in 3D printing in aerospace, having made more 100,000 additive manufactured prototypes (including tooling and development engine hardware) over the past 25 years, and we always find ways transfer innovative technologies from our OEM side to our MRO business.
How does your company encourage innovation?: rederick Rentschler, founder of Pratt & Whitney, created the WASP engine, a lighter, air-cooled engine that revolutionized the aircraft industry. The Geared Turbofan engine is another example of challenging the status quo to create an innovative technology. We continue that tradition today by encouraging innovation across all aspects of our business, including MRO. We regularly collaborate with our engineering team to incorporate innovative repair technologies into our maintenance and repair network. Innovation is the life blood of Pratt & Whitney.

Mário Lobato de Faria Executive Vice President, TAP Maintenance and Engineering

As an industry, from your perspective, how is commercial MRO doing (the state of the industry)?: Generally speaking I still see commercial MRO doing well and will continue to do well since we continue to see growth worldwide, more in some regions than other. The Industry will continue to be dominated by the OEM’s pushed by the airframers to make their business in the aftermarket and by the big MRO Groups that have size and financial “muscle” to compete. Smaller MRO’s will continue to strive and will have to find market niches and associate with the bigger players if they want to survive.
What do you consider keys to success in MRO?: As in any other business you have first to be reliable and trusty delivering at least what you promise. More and more you need to have financial “muscle”, if we’re talking about engines and components, since most Customers expect value propositions that redraw risk from them regarding capital to invest on spares, special tooling, etc. You need to be “suit up” with an array of solutions and flexibility that fills the Customer needs and for that you need experienced, skilled and well trained professionals at the different MRO functions and have the technological capacity to provide such solutions. Last but not the least you need to have in the commercial department the capacity to “read” the market and the Customer needs, anticipate the opportunities and be very quick about it.
What trends are impacting or will impact MRO in the near future?: I would say OEM’s presence in the aftermarket. I’m curious about the outcome of EU Commission enquiry; increasing reliability and new technology; partnering and associating and finally rulemaking.
How will Big Data impact MRO? Is Big Data being used by your company and, if so, how is that improving your business?: First of all you need to be prepared for it and properly manage it and a lot of independent MRO’s will have difficulties here. Then there is a question about how much OEM’s, in the future, will give access to MRO’s and will that be for free and for everyone. The usage of Big Data helps you to be preventive, more responsive and at the same time to fine tune your troubleshooting abilities. This builds up expertise that is many times appreciated by Customers, building trust in our know-how. On another hand helps to understand what happened in case of a problem.
How will additive manufacturing impact MRO?: This is for sure a growing activity. The impact in MRO is still to be determined in my opinion since we need to understand on how these products will behave in time and what will be, if any, the constraints in terms of repair techniques.
How does your company encourage innovation?: First of all we need to develop and sustain an innovative culture. We need to create an organization environment that is collaborative and that sees errors as normal in the innovation process. One of the programs we’re involved in as coordinators is about preventive maintenance under the Clean Sky 2. We also hold a continuous improvement program where we involve workers in solving their own problems by changing processes or introducing new tools or technology. The results tie back to the management kpi’s.

Sarah MacLeod Executive Director, Aeronautical Repair Station Association

As an industry, from your perspective, how is commercial MRO doing (what is the state of the industry)?: It’s possible to be both an optimist and a realist in looking at the industry right now – I’m an optimist constantly mugged by reality – because maintenance businesses have seen some good years and are looking ahead to more. ARSA’s 2016 member survey is still in the field, but early returns show that nearly half the respondents saw growth over the past two years and 70 percent expect it to continue over the next 12 months. On a broader scale, the association’s annual market assessment projects three to four percent growth worldwide over the next decade. These are all good signs for companies with solid technical capabilities and competent management. The reality is that even with great long-term numbers, there will be down cycles. If you can withstand the ups and downs of this cyclical industry, there is going to be long-term profitability in your future. When companies push too hard, some promising double-digit growth as a “norm,” they put too much pressure on both themselves and the industry. Goals that over-estimate long-term impact beget both individual mistakes and industry-wide problems. You can be going gangbusters one day and cutting staff 18 months later if you lose sight of your foundational technical competencies. In an industry populated mostly by small to medium sized enterprises with 50 or fewer employees, being able to withstand the cycles can be a daunting challenge. It’s a necessary one, though, because the big “industry leaders” may be a little more insulated from the ups and downs but they can’t survive without smaller shops across the supply chain.
What do you consider keys to success in MRO?: Sound technical capability with an innovative, stable management profile. When a management team is competent and stable, it can establish and maintain strong technical capabilities and innovation. Within an established technical envelope, companies can find new methods and customer markets while taking advantage of capital improvements. The key to success for any business is exactly the same: Be very, very good at what you do and find new ways of doing it; be active and participatory in business operations, industry policymaking and politics. Of course, that doesn’t mean jump on every new thing that comes along, but even Charles Taylor would have to evolve to stay in business today.
What trends are impacting or will impact MRO in the near future?: The maintenance industry is excellent at crisis management – so it can withstand whatever challenges arise in the immediate future. It is the long-lead time items that create the largest impact. For example, as Congress tries to reauthorize the FAA (two extensions of the current law already, and we’re just getting started) industry is again facing the congressional propensity to legislate safety rules (activism is particularly important in fending off Washington’s micromanagement). The skills gap and the technically-skilled worker shortage is another long-term threat that we need to address. In every recent ARSA survey (and we’re seeing it again this year) members have reported difficulty finding the right people; it’s part of a larger crisis facing the industrial economy. Finally, we have to manage the friction between OEMs and repair stations as larger businesses fight for control of data, software and maintenance instructions (Instructions for Continued Airworthiness).
What were ARSA’s key accomplishments last year?: This year, ARSA’s value was best displayed by what we prevented from happening. Perfect example: the “new” 8130 requirement in MAG Change 5. It was a potential debacle that could’ve cost industry millions and grounded the international business of FAA certificate holders. We led an industry-wide effort to “smooth” implementation by realigning its effective date with regards to parts documentation. It’s not over yet; we’re working constantly to help the FAA reasonably implement the new 14 CFR § 21.137(o) allowing production approval holders to issue authorized release certificates.
I invite everyone to review ARSA’s work on that issue at arsa.org/mag-change-5. The entire maintenance community continues to get a return on that investment. It’s a microcosm of the association’s continuing efforts as the industry’s voice: preventing disasters by enforcing commonsense application of the rules and helping manage the intersection of business and government.
Of course, we accomplished much more than that last year and it’s all chronicled in one way or another at arsa.org.

Dany Kleiman AAR, VP of Repair & Engineering

As an industry, from your perspective, how is commercial MRO doing (what is the state of the industry)?: In MRO, we continue to see an increase in demand for wide-body aircraft maintenance, which AAR can accommodate at most of its five aircraft maintenance facilities in North America. There is also heightened demand for cabin upgrades and retrofits. AAR’s strong in-house engineering staff is uniquely equipped to augment airline customers’ technical engineering requirements and the upgrades can be then be done at our MRO facilities.
What do you consider keys to success in MRO?: Diversification of services is key to running a successful MRO operation, as is establishing long-term partnerships with major legacy carriers. AAR’s broad range of services and multiple facilities allow us to maintain the fleet from tip to tail including heavy airframe maintenance, landing gear overhaul and component repair. We have long-term contracts with major legacy carriers that have locked in capacity for a few years, which enables us to provide two-way insurance both from the carrier side and our side – a true partnership.
What trends are impacting or will impact MRO in the near future?: OEMs are expanding into the engine and components markets. At AAR, we have strategic relationships with OEMs around contract maintenance support and parts distribution. Sometimes we collaborate with the OEMs; sometimes we compete against them. It’s a balance, but it comes down to what provides the best value to the customer. The return of wide-body work to the U.S. As the labor wage gap narrows, more U.S. companies are going up against Asia Pacific providers and AAR has benefited from this trend given our ability to accommodate wide-bodies at most of our MRO facilities. Airline consolidation. I expect to see more consolidation in the industry because there are still too many players in component and airframe MRO, particularly as it relates to narrow-body work. Phasing out, bringing in new fleets. Airlines are phasing out old/classic aircraft and introducing more and more NG and future generation aircraft, which impacts the scope and the interval / frequency of the heavy maintenance required, as well as investment in new technology to support the next generation fleets. And AAR is making these investments including the opening of a sixth wide-body repair station in Rockford, Illinois, later this year that is specifically designed for next-generation aircraft
How will Big Data impact MRO? Is Big Data being used by your company and, if so, how is that improving your business?: Big data is obviously impacting MRO and increasing our ability to provide customers with more than just labor. At AAR, we anticipated this opportunity to add value, and we developed the 1MRO Software Suite of customer-facing, integrated IT solutions to manage every step of an aircraft MRO project, including labor tracking, inventory and performance reporting with improved metrics to reduce costs and ensure on-time delivery. And we just recently debuted mobile apps that allow customers to see and approve this information in real time from the palm of their hand. Utilizing our IT tools, we see opportunities for our customers to provide a higher reliability in their fleet and reduce their costs. As the largest MRO network in the U.S., AAR’s ability to fully equip and/or interface our customers with our IT tool box, as well as quality and reliable engineering, provides more value to our customers, especially large carriers we work with over the long term.
How does your company encourage innovation?: At AAR we recently launched an innovation campaign ompanywide called Ideas Matter whereby our employees are encouraged to submit their ideas for ways we can improve service, quality and processes – and be compensated for it. In addition, we are always constantly working to enhance our IT tools and communications to improve mobility, transparency and accountability. We also use innovative IT systems to improve the cost-effectiveness of our customers’ engineering and technical resources in fulfilling component power-by-the-hour agreements and making long-term preventative maintenance recommendations.

Leo Koppers SVP Marketing & Sales, MTU Maintenance

As an industry, from your perspective, how is commercial MRO doing (what is the state of the industry)?: I think that commercial engine MRO is doing very well, at least as far as MTU Maintenance is concerned! As a matter of fact, 2015 was the most successful year we had in history: MTU’s commercial maintenance business increased its revenues by 22% to about €1.6 billion – the highest growth within the MTU Aero Engines group. Further, we signed over 250 MRO contracts valued at around $2.1 billion, a new record and an increase of roughly 25% over 2014. From a market perspective, commercial MRO is a fast growing market. In our latest forecast, we estimate that shop visits for commercial jet engines above 100 seats will grow at just above 4% p.a. over the next ten years – from ~7,200 scheduled visits in 2015 to ~10,700 by 2025. MRO revenues should grow with a solid 7% p.a. when taking price escalation into account. Growth will be strongest until the end of this decade, with a slowdown expected thereafter as today’s volume programs get mature and increasingly replaced with newer engine technology with longer time-on-wing.
What do you consider keys to success in MRO?: From a market perspective, I would say that there are several levels of key success factors: first, hard facts related to MRO operations such as competitive pricing and logistics (turnaround times and on-time delivery) as well as high quality levels. Also a must, from a soft fact perspective, is the ability to provide support that matches, or better exceeds, customer expectations. Once these basics are met, success certainly depends on the provider ability to develop additional and innovative products and services that differentiate the company from its competitors. Our motto is “We offer more”. This explains MTU Maintenance’s USP in a nutshell. As the world’s leading independent MRO provider, it is our aim to provide our customers with individually tailored, one-stop- shop solutions which run over the entire engine lifecycle and allow them to benefit from minimized operational costs and maximized engine value. Apart from traditional MRO services, we offer on-site and on-wing services, spare engine support, engine trend monitoring as well as accessory and LRU management. But we also go one step further. With MTUPlus Mature Engine Solutions, we offer customers who are operating aging engines alternative MRO solutions that combine customized workscoping and material salvation. In addition, alternatives to MRO, for example lease or exchange engines, provide them with immediate thrust. The latest addition to our services beyond MRO is MTUPlus Asset Value Maximization which provides asset owners seeking a return of investment for their end-of-life engines innovative solutions which either optimize the engine’s usage if it can still be operated or maximize the material value through the remarketing of its individual parts.
What trends are impacting or will impact MRO in the near future?: What’s really interesting is the potential impact of low fuel prices on the engine MRO market. The positive trend is that the phase-out process of mature aircraft has slowed down and some of our customers are now flying their mature assets longer. We are not yet sure though whether this is just anecdotal evidence, or not. What also remains questionable is whether this trend will ultimately lead to a pick-up on MRO work for mature engines, or if MRO demand can be met by instant power solutions such as engine exchange or leasing as an alternative. We’ll need to wait and see. In any case, we have the right products in place to serve either side of the demand.
How will Big Data impact MRO? Is Big Data being used by your company and, if so, how is that improving your business?: Big data helps us to better evaluate the behavior of certain fleets by being able to identify specific patterns which can only be detected due to the larger amount of data that are being gathered on newer engine types. To put it simple: big data allows us to make far more detailed analysis and take the appropriate corrective actions, if necessary – so we are eager to follow that trend.
How will additive manufacturing impact MRO (give examples of how your company is using additive manufacturing in MRO, if applicable)?: MTU Aero Engines has started with additive manufacturing processes to produce boroscope bosses for the PW1100G-JM engine powering the A320neo. Another example is a new seal carrier that was designed for a demonstrator engine based on Pratt & Whitney’s PW1500G. It is supposed to be used for the next generation of geared turbofan engines.
In the maintenance section, we are closely following this development as it has a major potential for parts repair, for example to restore the blade tips.
How does your company encourage innovation?: We are constantly looking at new ways to reduce cost in order to stay ahead of the competition. This not only means improving our production processes and developing new technologies, but also creating innovative services that bring value to our customers – as explained before. Our engineering expertise as the primary driver for innovation: as a group, in 2015 we invested €210 million in R&D projects. Further, we actively ask our employees to come up with new ideas as part of our company-wide suggestion scheme.

Jeff Bartlett Director – Airlines, BAE Systems

As an industry, from your perspective, how is commercial MRO doing (what is the state of the industry)?: Our industry has become more efficient and competitive in response to the recession and higher fuel costs. Lessons learned have not been forgotten with the improved economy and lowering fuel costs. Used serviceable material and pooling are game-changers for the parts segment. Component OEMs that relied on spares sales to pay back development costs must now offer new solutions. Overall, the aircraft manufacturer push into the aftermarket has sharpened each channel’s focus on defense of their share, with MROs seeking to grow demand for integrated solutions and OEMs seeking to leverage their product expertise.
What do you consider keys to success in MRO?: The key is to understand where you sit in the value chain, which channels are natural for you, and where you need partners to deliver the new solutions that the airlines expect. Underpinning all this is the need to be more agile and responsive with real-time solutions.
What trends are impacting or will impact MRO in the near future?: Expect to see more partnerships and alliances. No one can be all things to all market segments. To defend share in our competitive environment, companies need strategies for multiple channels to market, and this can be achieved efficiently through teaming. Another trend is forecast volatility. There have always been many variables at play in forecasting our business, but add the structural changes in the market, and the dynamic market responses, and it’s becoming harder to forecast. Flight hour agreements help, as does the further use of analytics.
How will Big Data impact MRO? Is Big Data being used by your company and, if so, how is that improving your business?: Big Data generally refers to the massive amount of data captured on new platforms, but it’s also interesting to see how analytics are transforming older platforms. Inventory management, economics around used serviceable material, and product reliability are all becoming more data driven. As a component OEM, “big data” includes how product expertise is leveraged to develop innovative product improvements to improve on-wing reliability and life extension.
How will additive manufacturing impact MRO (give examples of how your company is using additive manufacturing in MRO, if applicable)?: Additive manufacturing is geared for mechanical parts and not the electronics world, so it has not been a factor yet. However, it will be interesting to see how additive manufacturing might address obsolescence issues with the mechanical elements of electronics products.
How does your company encourage innovation?: As a component OEM, innovation is our lifeblood, not just in developing new products like IntelliCabin, but also in using field data to improve performance. Two areas where we see this are modification programs to standardize fleets, and Full-authority Digital Engine Controls (FADEC) overhauls to prevent unscheduled removals. As the market evolves, we are complementing product innovation with service innovations in asset management.

Pastor Lopez CEO, PEMCO World Air Services

As an industry, from your perspective, how is commercial MRO doing (what is the state of the industry)?: 016 will be a busy year for MROs. Airlines are spending capital in upgrading and standardizing their fleets. At PEMCO, all of our bays are sold out for the remainder of the year — except for the slow period in July. We have an entire hangar dedicated to one carrier, with four to five lines depending on schedule. In the other hangar, we have four lines of mod for a legacy carrier and two lines of checks for two different low-cost carriers.
What do you consider keys to success in MRO? A: Aside from quality and on-time performance, we believe that customer service is essential to what we do. At PEMCO, we have taken a hard look at our entire operations and developed a strategy around four cornerstones: Teammates, Customer Service, Lean, and Metrics. It all has to start with our team. We have made great progress in getting team members to buy in to our vision, and we are empowering them to make necessary changes via the Lean program. We then place rigorous metrics around each function, which we review on a weekly basis. Customers are the reasons we exist. They want us to provide information in real-time and be very transparent. Again, transparency comes from empowering our team to connect directly with customers.
What trends are impacting or will impact MRO in the near future?: Lower oil prices will have a short-term impact — unless prices remain fixed at current levels. This means retirements will slow down, as happened in 2015, by most assessments. Most airlines executives I speak with do not believe the current oil price levels are sustainable in the long run. Moreover, airlines take a long-term view when planning for future growth. The labor pool is and has been an issue for a long time. On a recent visit to Phoenix, two of us from PEMCO took an Uber ride to the airport. We were discussing our MRO business as we encountered the typical morning rush-hour traffic. The driver turned to us and said, “I have an A&P.” He stopped working as an aircraft mechanic because he is making more money as a contract driver for a limousine service and driving for Uber in between jobs. Other industries are recruiting A&P mechanics with better offers. This places a burden on our “ecological” system. As a result, we’re working hard to create an environment where people truly want to work for PEMCO because of the kind of company we are, rather than for just a paycheck. The MRO industry remains fragmented. While airlines have consolidated in the last 10 years (11 carriers at the turn of the century have now folded into five), the MRO industry has been very slow to react. Yet some companies are creating additional supply by building new hangars instead of using the consolidation approach. This will have a negative impact on prices, which in turn reduces the labor pool’s desire to enter this industry — which is why I call it an “ecological” system.
How will Big Data impact MRO? Is Big Data being used by your company and, if so, how is that improving your business?: In 2015, we added an analyst to our staff. Adam Butler’s job is to analyze every single check type to help us improve our performance. Thus far, we’ve had some successes, some reasons to celebrate. For instance, there is one C-Check type for one specific carrier that we used as a loss leader. This changed through data analysis. That check is now very profitable and we were able to reduce the span time as well.
How does your company encourage innovation?: We have a great employee base with terrific technical depth and airline background. Our customer base is well diversified with four major customers operating similar aircraft equipment. This allows us to become very efficient on this platform. We use our Lean program to spur innovation. Lean is a long journey and there is no final destination. I am truly encouraged from what I am seeing at PEMCO. Some of our teammates have taken initiative and implemented small 6S programs in their areas. I believe the message is being heard, and we are getting the buy-in we need to succeed. We have a great team of technicians that are hungry for knowledge and truly want to do the best they can for our customers. I am really excited about the opportunities we have at PEMCO.

Christopher Whiteside President, AJW Group

As an industry, from your perspective, how is commercial MRO doing (what is the state of the industry)?: The component MRO industry has changed significantly in the past few years and continues to evolve. Regional specific factors are forming a real divide between geographical locations, often due to foreign exchange fluctuations mainly driven by the USD on the back of oil pricing. We are seeing markets mature and OEMs looking for larger after-market share particularly on the newer platforms like the A350. Independent MROs who, unlike AJW, do not have OEM approval, are struggling to get into the new fleet types. We are also seeing a shift towards credible integrators of multiple OEM offerings with the ability to give nose-to-tail MRO coverage or, at least, complete ATA chapter coverage with multiple OEM content. The other shift is towards greater emphasis on reliability with more focus on total costs, rather than individual repair prices.
What do you consider keys to success in MRO?: Quality, price, reliable TAT and responsiveness – in that order – and partnering with the OEMs. Cost, and by cost I mean total cost, is always a factor. MRO evolves with time, often through technology advances, or adapting to new airline methodology. Our success has been driven by matching our solutions with the needs of the customer. The needs of an LCC are dramatically different to those of a large global legacy carrier.
What trends are impacting or will impact MRO in the near future?: Global boundaries are disappearing, and new aircraft manufacturers are breaking into the market, along with the new aircraft types entering their first cycle of maintenance. The trends of MRO are driven by the needs of the operators and as more operators reduce their internal supply chain resource to concentrate on the core business of operating the airline, the MRO provider is being asked to provide a total solution. AJW is seeing changes in airline behaviour as they move away from the ad hoc repair market, towards our more financially stable flexible PBH contracts. AJW Group is more frequently being asked to provide not only MRO support, but also pooling and logistics functions combined. Another trend is for OEM manufacturers to increasingly look for partners who specialise in aftermarket support to improve the service angle of aircraft post-delivery – that is an integration of the OEMs and AJWs services.
How will Big Data impact MRO? Is Big Data being used by your company and, if so, how is that improving your business?: AJW has been collecting real life data in order to improve reliability and cost for our customers for more than 20 years. The analysis of this historical maintenance data is extremely important when it comes to forecasting the cost and profitability of potential PBH contracts. We have invested in state of art data mining tools and interfaces, in addition to employing professionals with data visualisation skillsets. We are able to perform advanced data mining in various ways because we have a consistent data structure at the point of data entry. With our big data, we can run part-usage statistics based on any commercial aircraft type. We have usage statistics on over 800,000 unique part numbers in our database giving us the competitive edge in the marketplace. We can also measure a repair shop’s performance and costs based on any specified part number to ensure we meet the service level of expectation for our airline customers. One example is the use of our data to recommend additional work scopes over and above the CMM (Component Maintenance Manual) at our own MRO facility AJWT Technique. We are also using data to formulate soft life proposals to our customers. As big data becomes more prevalent it will be possible for a seamless demand and replenishment cycle to be put into place where the MRO provider is alerted to a need while the aircraft is still in flight. Just as happens in the rotary industry with the likes of HUMS.
How does your company encourage innovation? I: Innovation has been at the heart of AJW group, it is part of our ethos across all divisions. We are never satisfied, to improve we must innovate. We have seen several innovative ideas from the very simple to the very complex come from all corners of the workforce over the past months. We are seeing people with 25 years of aviation experience coming up with new, better ways to complete their task. We also use other industries to benchmark ourselves against, using non-aviation innovative ideas within our organization and leverage information technology.

Jeremy Remacha CEO, SR Technics

As an industry, from your perspective, how is commercial MRO doing (what is the state of the industry)?: he global commercial MRO market is estimated to continue growing by 4% per annum for the foreseeable future. Whilst this provides a positive trend, the industry continues to realign itself with cost, technology and service delivery challenges. Furthermore, although operators may be benefiting from lower fuel prices, the cost pressure on MRO services continues to create harsh competition and pushes companies to seek more radical measures to meet customer expectations. In some cases, it will require new business models, innovation and greater flexibility in order to succeed. New aircraft platforms and engine types coupled with older generation retirements and OEMs expanding into the aftermarket services is dramatically changing the landscape for traditional MRO providers. At SR Technics, we acknowledge the need to be more nimble, ensure a global presence and continue to focus on the key factors which are important to all our customers. This also includes closer alliances with our major customers, strong OEM partnerships and a total commitment to service delivery.
What do you consider keys to success in MRO?: We are competing on a truly global market, where cost is a major driver. In this environment, customer retention and satisfaction become increasingly important along with the ability to deliver high quality at competitive prices. At SR Technics, we are focused on developing strong, long-term partnerships and co-operations with airlines, leasing companies and OEMs, delivering tailored solutions that add real value. We have also expanded our global footprint, offering greater proximity to customers.
What trends are impacting or will impact MRO in the near future?: In response to price competition, companies are constantly looking to improve their cost structure seeking economies of scale. As a consequence, this may lead to changed service models, different geographic locations (with lower costs) and further industry consolidation. The aviation industry is transitioning between mature and new aircraft platforms. However, the lower fuel costs provide an opportunity for some operators to extend their fleet and defer capital expenditure, prolonging the core traditional MRO work activity. The expectation is that the price to operators will continue to realign with market forces and MROs will thus need to continue to innovate, relocate or consolidate. At SR Technics, we have seen some airline operators moving to in-source activities such as line maintenance and engineering while start-up airlines, especially in Asia, are looking more to a total outsourcing model for their MRO activities.
How will Big Data impact MRO? Is Big Data being used by your company and, if so, how is that improving your business?: Big Data has the potential to fundamentally change the MRO industry as well as aviation in general. Access to data and the ability to interpret and analyze information can lead to improved reliability, greater predictability, lower costs and ultimately, improved safety outcomes. None of this can be achieved without significant investments and time. At SR Technics, we are successfully using Big Data for inventory optimization supporting over 1000 aircraft. Customers provide us with live data, giving us with instant visibility on the location and conditions of managed inventory whether it is owned by SR Technics, the customer or the supplier. Combining this data with advanced analytics software enables us to optimize investment and tactically deploy our inventory within our global network.
ARMAC, an SR Technics subsidiary, has developed specific inventory optimization software that utilizes Big Data in the decision-making process enhancing asset utilization while improving delivery performance. This can be further developed to support customers to optimize their internal supply chains.
How does your company encourage innovation?: Implementing innovation requires a positive culture and a commitment to change. The constant pressure of managing costs while serving our clients better is driving us to find new and innovative ways of doing business. We are continuously reviewing our processes and encouraging our people to seek new and innovative ways to make us more efficient and competitive on the global market, while maintaining our high quality and safety standards.
With an increasing trend of using tablets and mobile devices, we are looking to implement new applications as part of our supply chain giving technicians and customers a real time access to data.

Jim Sokol President MRO Services, HAECO Americas

As an industry, from your perspective, how is commercial MRO doing (what is the state of the industry)?: 2016 has started off well – trending better than 2015. We’re seeing positive trends as a result of modifications. Airlines are looking at cabin modification with a higher density. We’ve meeting a greater demand for ergonomic factors. We’ve also seen carriers respond to lower fuel prices by holding on to their older planes.
What do you consider the keys to your company’s success in MRO?: Adding the international recognition of the HAECO brand has been helpful. We are truly an international company which allows us to manage demand globally. HAECO is unique in that we provide airframe, engine, complete cabin solutions and line maintenance – one-stop shopping. There are very few companies who can do the engineering, certification, manufacture, and installation of interiors during aircraft reconfigurations. That sets us apart.
What trends are impacting or will impact MRO in the near future?: Airlines holding onto older narrow bodies as they get ready for NEO and Max. Record airline profits allow operators to differentiate their cabins through reconfiguration. Airlines are seeking true differentiation from their competitors.
Is Big Data being used by your company and, if so, how is that improving your business?: There’s so much different data. What do you track? We always strive for operational excellence, by tracking KPIs: Key Performance Indicators measure people, performance, safety and cost. We’re rolling out those measurements to the hangar in the same format – makes it simple for employees and not overwhelming by using key visuals everyone can understand. The key to Big Data is avoiding analysis paralysis by focusing on the key issues that impact the business.
How is additive manufacturing impacting MRO (give examples of how your company is using additive manufacturing in MRO, if applicable)?: We have yet to see any significant changes here on the MRO side. Our composite shop is naturally required to do certain things in specific ways due to regulations.
How does your company encourage innovation?: We actively solicit employees to bring good ideas about operational efficiencies. We are open to addressing concerns and have a feedback loop to vet and close every issue. That openness is built into HAECO’s culture and has brought about positive changes as we respond.

Refael Matalon Senior Director & GM Marketing and BD, IAI/Bedek Group

As an industry, from your perspective, how is commercial MRO doing (what is the state of the industry)?: The last year had been very prosperous for the aviation industry due to various global economical reasons which have pushed forward many of the industry players. There is no doubt that this strong, positive atmosphere has been reflected in many aspects of the MRO operation where we have all seen a strong, growing demand for MRO services, both in the field of Engines overhaul and Base Maintenance, as well as a very sharp climb in the PAX TO CARGO CONVERSIONS of B767-300 & B737CL/NG. In fact IAI BEDEK has been lucky enough to enjoy these days an increasing wave of conversions projects, in parallel to the growing demand for MRO Base Maintenance Services which are not only seen today as stand-alone projects but also appear as a completion service for our customers which had originally contracted with IAI BEDEK on Conversions programs.
What do you consider keys to success in MRO?: We believe that IAI BEDEK’s long history of over 60 years of experience in providing comprehensive MRO services under “one roof” , through its three Divisions for Aircraft, Engines and Components, has enabled our MRO center to develop very efficient pre-planning procedures to be used as a key factor in providing these services in the most efficient manner. We believe that a key factor to secure a smooth MRO project requires the combination of a strong core of experienced and knowledgeable Engineering personnel together with well advanced preparation of the required measures and properly preparing the facility for each and every Aircraft, Engine, LG & APU prior to its induction, from the logistics aspect as well as properly allocating the designated resources for each project respectively. This of course has to be performed in parallel to continuously monitoring and constantly developing an internal Quality Assurance program together with constant development of new measures and an in-house modernization program of the facility capabilities. This combination creates a “machine” which constantly strives for excellence in any aspect of our operation.
What trends are impacting or will impact MRO in the near future?: The trend of the OEMs being more involved in MRO with comprehensive total support will definitely affect the independent MRO suppliers who will need to look for cooperation and JVs with the OEMs. New generation engines have more on-wing life and the shop visit cycles are less frequent when LLP’s are replaced for full on-wing potential. Using remaining green life on engines is primarily one stage before end-of-life dismantling. Regarding airframe MRO the trend is for less structure and increasing composites support needs. IAI BEDEK is in an ongoing process to develop advanced composites’ capabilities to support composites’ maintenance needs. Taking into account that IAI is a manufacturer of composite parts for both military and commercial aircraft is giving IAI BEDEK a significant advantage in the composites MRO field.
How will additive manufacturing impact MRO (give examples of how your company is using additive manufacturing in MRO, if applicable)?: The additive manufacturing is not in use yet by our company. However it is evaluated for special tooling manufacturing which will definitely save cost and will justify the initial investment. Moving forward we foresee that the additive manufacturing will enable MRO’s to manufacture non-structural parts primarily interior parts once the certification of such parts will be regulated.
How does your company encourage innovation?: IAI BEDEK management is in an ongoing process of encouraging innovation.
A dedicated innovation director is coordinating the innovation efforts and activities. Each idea is evaluated by in-house experts in complimentary fields. The ideas which are found qualified are brought to an innovation committee led by IAI BEDEK GM. Each employee is aware that he has an open door for presenting innovative ideas.

Zilvinas Lapinskas CEO, FL Technics

As an industry, from your perspective, how is commercial MRO doing (what is the state of the industry)?: Considering the overall growth of spending on MRO-related services, some may state that in general the industry couldn’t have been better. But as the industry grows larger, so does the pressure from airlines for MROs to lower the prices.
Also, a lot of other issues and challenges remain unsettled. These challenges include, but not limited to: Entrance into service of new generation aircraft which have longer maintenance intervals and thus have lower demand for shop visits;
– New generation aircraft as well as their operators become smarter, more advanced with regards to IT solutions – all of which drives
– MRO providers to invest additional funds into upgrading their IT infrastructure and the qualification of the work force; with regard to using all the benefits of new IT solutions and exploring more efficient business processes (e.g. LEAN), MROs also encounter the “mind set” issue whereas more experienced but yet less flexible work force doubts or opposes the implementation of new solutions
– Growing concern of some emerging markets, including Indonesia, over the quality and safety of local MRO providers (both independent and airline in-house units) and their readiness to invest into process improvement and certification according to EASA/FAA standards;
– Increasing pressure on MROs as legacy carriers continue cost reductions in their intense competition with the LCC segment; the ability of an independent MRO to offer a wider package support or any other added value (i.e. develop new, more accurate business and cost models) – this will define who will stay in business for at least another 10-15 years; otherwise they will be merged, sold or shut down;
– Continuous growth of OEM presence in the MRO market which will only increase in the future as new generation aircraft (and engines) will replace the current generation; MRO market players should accept the fact that OEMs are here, and they are here for long; there are many ways how MROs and OEMs can cooperate; independent MROs also have something that many OEMs do not – flexibility and wider geographical coverage; in some cases, independent MROs can also offer more favorable pricings, particularly for small and mid- size airlines.
What do you consider the keys to your company’s success in MRO?: One of our main advantages – one-stop-shop services. We offer base and line maintenance, engine/APU/LG maintenance management, spare parts and components supply, training, engineering, DOA. The ability to support an airline with comprehensive set of services provides us with larger pricing flexibility as well as allows airlines to save own resources while managing all the vendors and separate MRO projects.
Another factor is becoming more LEAN and IT advanced. Shifting both hangar and office processes to LEAN standards has allowed us to reduce daily resource consumption and fasten turnaround times. Together with new IT solutions, some of which we have developed in-house, we are able to offer our customers more transparency and accountability with regards to actual man-hour consumption.
The third major factor – diversification. We do not limit ourselves to one specific market or region. Local economies (and aviation markets as well) are always exposed to global and regional risks. If you focus on one single market (e.g. base maintenance or North America only), it will be quite a challenge to start exploring new customers outside the market should something happen. We, at the same time, are present in all major MRO segments while having customers and partners in all world regions. Such business diversification allows us to correlate our sales force and adapt products without any “death or life” scale risks.
What trends are impacting or will impact MRO in the near future?: Less checks per aircraft, but more aircraft overall; tighter competition between MROs as well as with OEM; more joint programs by OEMs and MROs; stronger pressure from airlines and the struggle for higher efficiency; increasing role of advanced IT solutions.
Is Big Data being used by your company and, if so, how is that improving your business? How does your company encourage innovation?: Without a doubt, smart metering, Big Data and Internet of Things are the key to efficient resource distribution, more accurate TAT planning and thus shorter customer’s aircraft downtime. However, these technologies are still in progress of winning the industry’s recognition as the market needs more successful examples (case studies).
At FL Technics, we prefer not to wait, and develop our own IT solutions which allow us to track man-hours and all maintenance works in real time. This helps us to detect any potential delay and process flows (e.g. works stopped due to unsupplied spare parts or a need for customer’s authorization) before it starts affecting TAT. Moreover, as approx. 80% of delays come due to poor and lengthy communication between the MRO and its customer, we’ve also introduced an online communication system which allows our engineers to receive direct authorizations on additional parts or works from customer’s technical manager. This allows avoiding intermediates in the communication as well as speed up the confirmation process and thus minimizing the downtime of an aircraft if an unscheduled work is required.
In addition, we have developed an app for in-house spare parts supply that allowed mechanics to promptly upload a request for required parts and get instant notification when the part arrives supplemented with information where the part is exactly stocked. Also, we are to integrate wearable technologies and other smart devices which should ease internal communication, data exchange and access to technical documentation for our technical staff.
However, any MRO can achieve much more noticeable time and human resource savings if all MRO chain players – from OEMs and suppliers to airlines – would engage in automated data exchange and synchronization, document digitalization and other related processes. In order for the MRO industry to benefit from Big Data/Internet of Things technologies, all stakeholders must have a more pro-active engagement. The industry also needs more exemplary case studies.

Jim Martin Founder & Managing Partner ACM Aviation Staffing and President & CEO, Marana Aerospace Solutions

As an industry, from your perspective, how is commercial MRO doing (what is the state of the industry)?: The industry is in transition with many facilities being built in North America and Latin America. The chief constraint in North America remains qualified labor. This problem has become more acute as there are not enough mechanics entering the market to replace the ones who are retiring.
What do you consider keys to success in MRO?: Managing the maintenance schedule for the customer so that the heavy check is returned on time, within budget, and without defects.
What trends are impacting or will impact MRO in the near future?: Consolidation has already impacted the industry, and will continue to do so, as will the labor constraint. Additionally, airlines are retiring aircrafts faster than they used to. This can have an adverse impact to maintenance providers, but will prove to be a benefit to the tear down facilities and companies buying aircrafts to part out.
Should maintenance training be changed? If so, how?: I think that there should be better oversight on foreign MROs. I don’t believe that these facilities maintain the same quality and training standards as the North American facilities. I also think its next to impossible to have the same FAA oversight overseas as exists in the States.
What challenges are you encountering in finding the right people for the MRO environment?: There is already a shortage of skilled labor and it is getting worse. Many young people who opted for trade schools in years past are now opting to enroll in online universities. Unfortunately, many of these young people end up with substantial student debt and no real opportunities for employment after graduation. So it’s a double whammy. And it’s not just the aircraft industry that is experiencing this shortage, but also HVAC, automotive, electrical and plumbing.

Turkish Technic Senior Official, Turkish Technic

As an industry, from your perspective, how is commercial MRO doing (what is the state of the industry)?: Maintenance, repair and overhaul providers (MROs) play an essential role in sustaining the world’s airline fleets. Today, it is estimated that the global market is worth up near to $67 Billion and will grow to $100.4 billion by 2025. The aircraft fleet is growing year by year. Today, total number of commercial aircraft fleet reaches around 24,000 aircraft and will expect to grow by 3.7% cumulative annual growth rate to 34,408 aircraft in 2025. In this 10 year period, the narrow body jets will continue to dominate the market. It is clear that maintenance repair and overhaul demand will increase with the rapid increase in aircraft fleet. It is certain that the main challenge for all MRO providers to supply is to respond to the rapid growth in demand by providing maintenance services with a highly qualified workforce.
What do you consider the keys to your company’s success in MRO?: Sitting on the crossing point between East and West, Turkish Technic believes geography and its history are all in its favour as it seeks to gain more and more business from outside. Key to being able to win business, of course, are the MRO’s capabilities. We have a nose to tail service for many types of aircraft. We are an airline-owned MRO where priority pushes us in one direction or another; which enables us to have a multi purpose approach and flexibility. Last but not the least, the ambition to achieve goals and seal the success is one of the most valuable keys to our success.
What trends are impacting or will impact MRO in the near future?: Being an early adopter of the 787/A350XWB new generation technology aircrafts will be a leverage, this is valuable experience and expertise; where Turkey is limited with lack of infrastructure and airport, which is being under construction; to be finished 2018, and be the largest of Europe. Big Data is the way to go for the MRO performance (streamlining maintenance data aids innovation and increase efficiency. Our insight/experience in that it may significantly impact maintenance cost and increase efficiency. And last, cabin interior modification is getting very popular with the latest influx of IFE and internet based products. In our opinion there is opportunity, because passengers are requesting immediate content and comfort vs. money paid for ticket.
Is Big Data being used by your company and, if so, how is that improving your business?: Regarding the Big Data, I think there is not enough data collected in MRO market. At Turkish Technic we focused more on predictive maintenance. We cultivate all data, including components, flight data and etc., for forecasting the remaining service period. So it would be better to name this “Big Data Processing.”

Eric Strafel President and CEO, Aviall

As an industry, from your perspective, how is commercial MRO doing (what is the state of the industry): The commercial MRO airline market segment is indeed healthy and continues to be very positive for Aviall. Fuel prices continue to be down and airlines are more profitable in current conditions. In addition, many airlines are now extending the life of their aircraft which in turn, creates the need for additional parts. At Aviall, we pride ourselves on our ability to deliver exceptional customer service along with the right part, at the right time with our extensive market basket of ~2 million part numbers from more than 240 original equipment manufacturers (OEMs). As the market evolves to support the rapid pace of new aircraft deliveries, we will continue working to align our parts and services offering with MRO needs.
What do you consider the keys to your company’s success in MRO?: The keys to our success start with our customer- first mentality and our ability to deliver better value, convenience and a higher level of service for our customers. As a result of our wide-ranging capabilities in both the parts and repair (MRO) business, we have a diversified global footprint in providing aftermarket support in the general aviation, business aviation, commercial aviation and military market segments. This large footprint allows us to be in global locations where our 26,000 customers need us most, making us an invaluable business resource.
What trends are impacting or will impact MRO in the near future?: As airlines move toward extending the longevity of aircraft, there is a growing trend for airlines to also increase the utilization of power-by-the-hour programming, thus increasing the level of business activity for MROs in the commercial, business and general aviation markets. This increased utilization will continue to produce a growing space for the MRO industry, as direct business from airlines continues to decrease. These trends will indeed cause a positive impact on the MRO industry and we look forward to being the supplier of choice for the industry, and watching the increasing momentum in these segments.
Is Big Data being used by your company and, if so, how is that improving your business?: Nearly three years ago, Aviall went live with a new enterprise resource planning system, SAP, across all 40 of our global locations. The implementation of SAP has allowed us to positively transform how we do business, as we are now in a position to better connect, as well as receive and analyze important data from the industry, our customers and suppliers. With the SAP foundation in place, we have been able to make significant investments in analytics tools, technical skills, technology partners and external data sources to better anticipate the growing needs and business demands of our customers and suppliers. Since its implementation, we have experienced improvements in supply chain planning and forecasting, product availability, electronic integration, value-added services and overall partner satisfaction in meeting the business goals and objectives of our customers and OEMs.
How does your company encourage innovation?: Innovation is built into the Aviall culture and is a core component of how we operate as a business. We strive to understand our customer’s business objectives and problems and secondly, find ways to apply innovative solutions using data analytics and technology to create value. This overall spirit is embedded in the way we think and assists us every day as we build continued supply chain innovation and operational effectiveness that deliver value to our OEM partners and customers.

Derek Zimmerman President, Gulfstream Product Support

As an industry, from your perspective, how is commercial MRO doing (what is the state of the industry)?: The Gulfstream Product Support organization is a growing and vibrant part of Gulfstream Aerospace
Corp. The continued growth of our fleet – now at more than 2,500 aircraft – and increased flight hours in the second half of 2015 helped keep the average loading at our 11 company-owned service centers worldwide at capacity for the year. For a good portion of 2015, our facilities were full of aircraft, and that included space provided by recent expansions. In May 2015, we opened a nearly 110,000-square-foot/9,290 square-meter hangar in Brunswick, Georgia, more than doubling the site’s under-roof capacity to as many as 16 large-cabin aircraft. In late November, we opened a renovated 19,000-sf/1,765-sm maintenance hangar at our site in Long Beach, California. Also, in August we opened a nearly 90,000-sf/8,361-sm paint facility dedicated to in-service aircraft.
What do you consider keys to success in service and support?: There are several, including people, parts, facilities, technology and customer engagement. For well over a decade, we’ve invested considerably in training, tooling, technology and positioning parts, materials and employees closer to our customers. Since General Dynamics bought Gulfstream in 1999, we’ve expanded our facilities at company headquarters in Savannah, opened U.S. service centers in West Palm Beach, Florida, and Las Vegas, added international service centers in England, Brazil and China, and appointed authorized warranty repair/line service facilities all over the world. We also offer maintenance, repair and overhaul services for our operators at Jet Aviation’s Teterboro Airport facility in New Jersey. In terms of customer engagement, we have made a number of enhancements to our customer support channels that open new lines of communication between Gulfstream and our operators, regardless of where they are located. In 2012, we opened a full-service multimedia center, Studio G, that we use to enhance communications with customers. Last July, we used the studio as part of the company’s first virtual Operators and Suppliers Conference, an interactive event to ensure that customers have the most up-to-date information on their aircraft. During the three-day online conference, Gulfstream experts stationed in Studio G in Savannah provided updates on model-specific programs, regulatory mandates, select aircraft systems and critical inspections to pilots, technicians, flight attendants and other flight operations personnel worldwide. Gulfstream operators submitted questions prior to the conference, viewed the presentations and participated in live question-and-answer sessions. The event supplements Gulfstream’s biennial Operators and Suppliers Conference, which will be held in June in Savannah, and the operators forums we hold around the world throughout the year. As for parts, we recently built a new state-of-the-art 337,500-sf/31,355-sm Product Support Distribution Center at company headquarters in Savannah, Georgia.
What trends are impacting or will impact business jet service and support in the near future?: One trend is the shift in aircraft systems — from mechanical to more electrical — and the specialized training and tooling involved with that transition. The three-dimensional model-based type design that we used to design the G650 is now an integral part of servicing that aircraft. What’s happening in aviation is similar to what happened in the automobile industry.
Another growing trend in our industry is the transition to an integrated paperless hangar. Moving from paper to electronic recordkeeping leads to process efficiencies and cost savings. And, finally, we’ve seen growth in the use of specially equipped vehicles to assist operators vs. having technicians tied to a facility. At Gulfstream, our Field and Airborne Support Teams — FAST — include several large customized trucks, a van and even a NASCAR-style tractor-trailer that brings technicians, tooling and parts plane-side to assist an operator. This significantly enhances our ability to support operators without having to establish a facility in the region. For example, we have a FAST truck based in Seattle that can rapidly respond to operators at airports there and in metro Portland, Oregon, which is less than three hours away.
Is Big Data being used by your company and, if so, how is that improving your business?: Yes, we are using Big Data. The Gulfstream G650 business jet, which entered service in December 2012, is a prime example of how mowre data can help our customers and improve the services we offer them.
The aircraft features an Aircraft Health and Trend Monitoring System (AHTMS) — known as PlaneConnect HTM. Previously, system failure events/data were only communicated from the aircraft at the top of descent. With PlaneConnect HTM, failures are reported on occurrence, giving support personnel and decision-makers additional time to initiate troubleshooting and resource placement. With the long legs of the G650 and Gulfstream’s worldwide support presence, we have created the ability to have field service personnel, parts or equipment in place at the aircraft destination, significantly reducing the time it takes to return the aircraft to service.
How will additive manufacturing impact MRO (give examples of how your company is using additive manufacturing in service and support, if applicable)?: We have used additive manufacturing to create on-demand tools and fixtures for components and ground support equipment repair, and will continue to look at how we can incorporate more of this 3-D printing into our business.
For example, this form of manufacturing may be a way to replace older components, allowing us to produce exact substitutes without production tooling. Replacement components can be printed on-site in less time than it takes to order and receive the part.
How does your company encourage innovation in the service and support sector?: Continuous improvement is part of Gulfstream’s culture. We have a program known as Your Ideas at Work that offers Gulfstream employees the opportunity to suggest improvements to their work processes. We’ve received and implemented thousands of ideas through this program. Throughout our company, we look at ways to make existing processes as well as new products and services more efficient.
A good example of innovation specific to our Product Support organization relates to our next aircraft, the G500. As part of the preparations for the aircraft’s 2018 entry into service, we integrated a team of maintenance technicians with Flight Test to follow the aircraft through manufacturing and flight testing.
The integrated team performed all the modifications and testing required to prepare the aircraft for first flight on Feb. 20 of this year, and will continue to lead it through testing in support of Federal Aviation Administration type certification in 2017. The goal is the smoothest entry-into-service possible for our customers.

Todd Duncan Chairman, Duncan Aviation

As an industry, from your perspective, how is commercial MRO doing (what is the state of the industry)?: The good news is that business jet flying hours are stable. The bad news is that they are not rising. In many preowned markets, aircraft transactions are occurring at a decent rate and we are seeing a good number of pre-buy evaluations in our maintenance hangars. Poor economic conditions, mostly outside the U.S. borders, combined with the strong dollar, are also pushing international business down. That means competition among business jet MRO providers right now is strong.
What do you consider keys to success in your service and support business?: The success of Duncan Aviation can be explained in one word: people. We invest in our team members and we trust them to take care of the customer. Our team members are passionate about their work and they make careers here. Of our more than 2,150 team members, 235 have been with the company for 25 years or more. That allows them to develop deep technical experience and really get to know the aircraft and our customers. Other major contributing factors would include the investment we make in the business and our long-term commitment to our people, our customers and the industry. Over the last 20 years, Duncan Aviation has invested nearly $175 million in facilities/tooling and nearly $48 million in training. In addition, we develop strong partnerships with the OEMs and strive to provide our mutual customers with the best possible service experiences. Our team members play integral roles in advisory and technical committees for a majority of the OEMs we support.
What trends are impacting or will impact business jet service and support in the near future?: Connectivity has impacted business aviation for several years now, and it is something that continues to be a hot button for operators. They want the same experience in their aircraft as they have in their office. The NextGen mandates will have a big impact on the industry over the next few years. We are performing some upgrades at our facilities, but as an industry, it is obvious that there won’t be enough industry capacity to complete all of the necessary upgrades before the 2020 deadlines. And we are of course all closely watching and participating in the developments from Washington, D.C., regarding regulatory oversight and funding for certification and support.
Is Big Data being used by your company and, if so, how is that improving your business?: We are definitely using technology and data in new ways today, and some are having a huge impact on our business. Our senior team takes time every year to look at a long-term, 10-year plan for the business. To do this, we rely heavily on economic projections and aircraft demographics. That data helps us determine what we will need in terms of facilities, capabilities, training and staffing. As I mentioned, we are committed to business aviation. We plan to be here for the long- term and every decision we make is done with the future of our company, our team members, our customers and the industry in mind. We have invested in a comprehensive, internally built Customer Relationship Management system to better track customers and ensure we are meeting their needs and keeping them informed of our ever-changing capabilities and services. In addition, our Work Order System allows us to look at the work we perform and capture repair trends, helping us to identify parts with higher fail rates. This information can then be used to provide repairs and maintenance that will provide longer lasting solutions for customers.
How is additive manufacturing impacting MRO (give examples of how your company is using additive manufacturing in service and support, if applicable)?: Our in-house Research & Development team uses additive manufacturing in the design and production of our in-house test equipment. This allows us to build our test equipment much faster and at less cost. In the last few years, we have utilized FDM (fused deposition modeling) in hundreds of in-house products and applications, ranging from prototypes of antenna mounts to tail stand alarms. Recently, we also used this manufacturing process in a Duncan Aviation-designed modification to an IFR RD-301 radar generator.
Additive manufacturing is an emerging technology, with new materials being added every day. It is not the right answer for every application, but when it is, we certain utilize it.
How does your company encourage innovation?: Innovation is certainly something we pride ourselves on and, quite honestly, is something that is part of our culture. We are celebrating our 60th anniversary in 2016 and I truly believe that we wouldn’t be where we are today without the innovative, entrepreneurial spirit of my grandfather and father. It is my goal to make sure we continue that tradition by maintaining a culture that has an openness to listen to the ideas and desires of team members, customers, industry partners and even competitors and, when it makes sense, to look for solutions and/or new ways to perform our work.
To capture team member ideas, we have a formal Continuous Improvement Program that allows team members to submit ideas and then be part of the team that collaborates with other departments to evaluate the impact and coordinates idea implementation, when applicable. Some of these ideas are as simple as creating a storage area for tools that increases team efficiency to as complex as constructing a humidity controlled storage area for leather to ensure ideal moisture content, which makes the material easier to work with. In 2015, we implemented 546 ideas, 60 percent of those involved several teams and collaboration across department and facility lines.
We listen to customers in several ways. We host weekly lunches and dinners with customers on-site at our Lincoln, Nebraska, and Battle Creek, Michigan, facilities. We ask them about their experience and how we could improve. On a more formal level, we have three Customer Advisory Boards, one in the U.S., one in Europe and one in Latin America. These Boards have one-day meetings where we listen to their challenges and experiences and ask them for their thoughts on some of our business plans and changes.
We also listen to industry partners and even competitors by participating in alphabet boards throughout the industry as well as OEM advisory and technical boards.

Neil W. Book President and Chief Executive Officer, Jet Support Services, Inc.

As an industry, from your perspective, how is commercial MRO doing (what is the state of the industry)?: New aircraft deliveries are down, pre-owned aircraft valuations are falling, flight hours are flat and a volatile world economy has created a challenging environment for business aviation. This type of environment benefits the consumer. The OEMs are fighting for fewer buyers of new aircraft and looking to aftermarket services to help bridge the gap. With an increasing emphasis on these service offerings, prices have stayed relatively flat, and the focus on service has intensified. It is a great time to be a buyer / consumer.
What do you consider keys to success in service and support?: I try to keep things simple. First and foremost, work hard every day to deliver a world class service experience to the customer. The best ambassador you can ask for is a satisfied customer. Of course, you cannot deliver a world class service experience without having the right people in the right jobs, delivering for the company day in and day out. It’s my job to work hard to create a corporate culture and work environment where we can attract the best and the brightest.
What trends are impacting or will impact business jet service and support in the near future?: One trend we have been seeing is that until a few years ago most buyers of new production business aircraft would rarely consider enrolling their aircraft onto an hourly cost maintenance program when they were accepting delivery. Today, buyers are more educated about the risks of unscheduled maintenance costs that are not covered by an OEM warranty, they recognize the need to begin accruing reserves for scheduled maintenance at time of delivery and they also recognize the increase in residual value a maintenance program provides.
Another trend which fills me with pride for our industry is some of the innovative services which are coming to market that have attracted an entirely new segment of the population to business aviation. The “shared economy” model has allowed companies to offer access to business jets at prices never before seen in the industry. Giving the consumer the business aviation travel experience will have a wildly positive impact on our industry in the coming years.
Is Big Data being used by your company and, if so, how is that improving your business?: The simple answer is yes we use Big Data, and yes it continues to improve our business. JSSI collects data points on the nearly 2,000 aircraft enrolled on a JSSI program. By leveraging our data, we effectively forecast both the timing and cost of maintenance events with real precision. We have been able to streamline the process of developing maintenance programs for new platforms in a fraction of the time that it took just a few short years ago.
How will additive manufacturing impact MRO (give examples of how your company is using additive manufacturing in service and support, if applicable)?: Technology across all industries is reshaping the world that we live in. Additive Manufacturing will ultimately have a profound impact on the business aviation sector by bringing parts to market more quickly and less expensively. Of course, there will be regulatory hurdles to face and the necessity for quality controls, but long-term, I fully believe that this new technology will ultimately have a positive impact, by creating greater competition among manufacturers and additional
availability of parts.
How does your company encourage innovation in the service and support sector?: At JSSI, we compete directly with the PBH programs of the OEM. For us to effectively compete, we need to provide innovative products and services to our customers to be successful. As a result, innovation is in our DNA. Recently, we began creating the next generation of JSSI services by going above and beyond the Engine, Airframe, APU or Tip-to-Tail® Programs that we have delivered for more than 27 years. We have introduced JSSI Parts, the ultimate JSS1 all-inclusive service and our new Asset Monitoring Platform (AMP) for the aircraft finance community. All three of these new programs are unlike anything we have offered before, and each provides a service to a segment of the market that will expand our footprint in the industry. These innovative ideas for new JSSI services were conceived through customer dialogue and collaboration with our extended family of vendors and suppliers. And I assure you there is more of this to come from JSwSI in the near future.

Malissa Nesmith Senior Vice President/COO, Global Parts.aero

As an industry, from your perspective, how is commercial MRO doing (what is the state of the industry)?: From GlobalParts.aero perspective, we see a promising market place. Aircraft OEMs appear to be more open to outsourcing support for their legacy, out of production aircraft, while they focus on new product development, production, sales and support. The legacy market is a good niche for us. We now have a proven track record with Bombardier’s recent acknowledgment of GlobalParts as a strategic partner. And now we provide comprehensive support to the more than 2000 Learjet 20, 30, and 50 series aircraft operators.
What do you consider keys to success in service and support?: From a parts distribution standpoint, success begins with having the right parts on the shelf, available to ship immediately as well as being available to our customers around the world 24/7. GlobalParts customers get a live person on the other end of the phone, no matter what time it is, and our ability to ship counter-to-counter is only limited by the airline’s schedule and availability. To enhance our Wichita based distribution, we have added warehouse capabilities to our hub in Atlanta, Georgia, and it has impacted our international success as well as supported our stateside responsiveness. Also, we continue to be successful by focusing on being a single source solution for the industry. Customers like service that is convenient, therefore we are always looking for more parts and services to offer to make it easy to do business with us.
What trends are impacting or will impact business jet service and support in the near future?: I see the market more open to PMA parts than ever before, and PMA seems to be losing the negative stigma that it had in the past. There remains a resistance to PMA parts overseas, but many OEMs do not even have the tooling available any longer for some legacy parts, therefore, PMA is the only option. The worldwide acceptance of PMA should continue to grow in the next few years and hopefully will include more reciprocating of FAA approved STC’s and PMA’s by international regulatory groups so that the overseas operators of legacy aircraft can benefit.
Is Big Data being used by your company and, if so, how is that improving your business?: We have been using add-on modules developed by 3rd party providers to enhance the efficiencies of our ERP system. Also, we continue to develop custom dashboards from our large databases to create more measurable feedback which in turns helps us make more informed business decisions in a shorter time.
How will additive manufacturing impact MRO (give examples of how your company is using additive manufacturing in service and support, if applicable)?: There has been some tooling work accomplished here at GlobalParts using Additive Manufacturing or 3-D methodology. Our engineers continue to learn about this advanced technology and how it will be applied to our industry. We expect other MRO businesses will continue to have a watchful eye on these advancements as well.
How does your company encourage innovation in the service and support sector?: We recently added a full Engineering department to help provide solutions to customers with certain on-going challenges. This specialized Engineering team can address issues on both the repair side and manufacturing side. The team is tasked with finding the right resolution to a customer problem or concern they may have dealt with for years, ineffectively. This process opens the door to innovative discussions we can have with our clients that might not happen otherwise.

Geoff Chick Vice President of Customer Service, Dassault Falcon

What do you consider keys to success in your service and support business?: It all comes down to the people in the organization: from a supportive executive management to passionate employees with the right attitude. That’s the key driver to any measure of success in business. Of course, we do this to create the best experience for our Customers. We continuously look for Customer input, especially our Operator Advisory Board. They offer valuable advice and feedback on how we’re doing and we take their input very seriously. It was the OAB that helped us define Falcon Response and the feedback on that program is almost universally positive.
What trends are impacting or will impact business jet service and support in the near future?: The biggest change we’ve seen over the past ten years is fewer operators have their own flight department and support structure. Most customers are relying on OEMs for additional support even with the elementary things. So, we’re now more mobile: going where the customers are. And, mobility extends to both scheduled and unscheduled maintenance. Our Go Team programs and Falcon Airborne Support are a direct result of this trend. We’re also seeing cabin connectivity as being such a crucial need that aircraft are being declared as AOG when connectivity is not functioning.
Is big data being used by your company and, if so, how is it improving your business?: The first tool that we have is something called ‘FalconScan’ which will be available soon. FalconScan is an on-board real-time self-diagnosis system. Previous Falcons incorporated onboard diagnostics to monitor hundreds of parameters, FalconScan will connect to all onboard computers and monitor more than 10,000 parameters. The ultimate benefit is an aircraft that can analyze data and detect faulty equipment thanks to patented algorithms. Operators, even in remote locations, will be able to autonomously troubleshoot the aircraft, identify needed parts, if any, and coordinate the quickest possible remedy. We also process and analyze both historic data and event specific data to put parts in key locations. For the major distribution centers we use a combination of the historical demand in region as well as the most critical parts – parts which cause the most flight delay and cancellations as well as parts with the most removals. For the smaller distribution centers we stock the most critical parts. We also analyze every flight delay and cancellation — no matter where it happens — and then decide in which location we should stock the parts that were needed to return the aircraft to service.

Charles Picasso CEO, Aviation Technical Publishers

As an industry, from your perspective, how is commercial MRO doing (what is the state of the industry)?: Overall, the MRO business seems to be doing well, showing good growth in the Corporate Aviation sector with many of our clients growing, in employees and space. A healthy business-aviation segment helps the MRO business and these days that segment is doing well. The best sign of how the industry is doing comes from multiple MROs we visited through the year that were expanding hangar space to accommodate their growth. Trends I see include continuing consolidation of MROs: growth despite a continuing contraction in customers servicing small, piston aircraft.
What do you consider keys to success in MRO?: There are several. Managing the employee shortage challenge, embracing technology opportunities to improve processes, data access, and quality. I can share three critical insights for success we have observed when visiting our customers. First, was a model for predictive revenue; second, was an openness to exploring how technology could improve their operations; finally, an open-mindset, specifically in the ability to talk with and learn from others in the industry. Honestly, over my career these keys to success are not just in the MRO market, but everywhere and it is great to see our leading customers succeeding with that mindset. GA is notoriously hard to grow a new business – so MROs need to get very focused around how to best serve the customer including enhancing their customer service and pricing. The old business adage, that remains universally true, is that repeat business is the best business.
What trends are impacting or will impact MROs in the near future?: I think digitization is they key trend that will impact MROs in the near future. The Internet, as a distribution channel, introduced the industry to digitization and ATP’s early work digitizing publications helped move MROs to use software to track maintenance and run their workflow. Today’s advances in digitization are moving MROs to stage information and data. And the future is in the Cloud, which can help them better integrate with the software used to run the MROs, leading to more collaboration between the players in the value chain – Manufacturers, Owner/Operators – and improve access to technical and regulatory changes. Mechanics w/tablets can be equipped with mobile apps to access relevant information at the time of need, rather than having to prepare work packages in advance of the airplane visit and then having to research for missing information. Mobile computing will deliver aircraft maintenance “at-the-asset.” In the future, we also see MROs adopting more on-line technologies. They are becoming used to using cloud-based systems to reduce their IT costs.
How will Big Data impact MRO? Is Big Data being used by your company and, if so, how is that improving your business?: More is not better if not used smartly. As part of Big Data we need improved data accessibility and employ smarter usage. There is a lot of good information on processes, trends, efficiencies and other data if it is mined intelligently. As companies incorporate technology into their systems, they are building Big Data stores they can start to mine for new business opportunities, greater inventory optimization, and to reduce purchased inventory by returning to JIT inventory management – Just in Time. Another area where Big Data will have an impact is in the harnessing the knowledge in an aircraft and fleet’s logbooks. We are already seeing access to eLogbooks helping the efficiency of maintenance operations, but with Big Data we can start to see trends across fleets that help in troubleshooting discrewpancies and improving the uptime of an aircraft.
How does your company keep pace with the ever-changing needs of the MRO community?: As with any business, the best way to keep pace with the ever-changing needs of the MRO community is to be focused on understanding the MRO providers inside and out. Where are they struggling, where are they succeeding, what do their processes look like, where are their challenges – then using this knowledge in the market, along with our technical skills, to continually help customers improve performance. As ATP continues a constant dialog with both the manufacturers and customers we can help them manage digital technical and regulatory data so they can integrate it with their maintenance data, to improve their performance.
How does your company encourage innovation?: You have to foster a company culture that embraces change. ATP has been around for over 40 years and gone through many iterations of technology to keep pace with the changing needs of the industry – launching the first digital publications in the late 1980s and early ‘90s and now helping MROs learn how Cloud-based information can take them up another step. And, you have to make a financial commitment to the technology and resources you need to be successful – it is a continuous innovation process, not something you start for a year or two and then stop. We encourage this innovation within our company by constantly engaging our people with our customers in their place of business. Through these visits we have tough discussions on what they like and don’t like about ATP, but also we gain understanding of where there are new opportunities for us to help them with their business.

Brad Thress Senior Vice President, Customer Service, Textron Aviation

As an industry, from your perspective, how is commercial MRO doing (what is the state of the industry)?: It is a remarkably competitive time in the industry right now. Not only are we competing on business terms, but we are also competing on customer experience. At Textron Aviation, we are focused on providing superior service and offering innovative solutions to meet our customers’ needs.
What do you consider keys to success in your service and support business?: We believe we are only successful if our customer is successful. We also think that no one can serve a Textron Aviation customer like Textron Aviation team members — customers have the direct access to factory expertise. We have worked hard to grow the capabilities and convenience within our company-owned network so that we can grow and maintain our direct relationship with the customer. We have grown our company-owned footprint to 21 service centers around the world, including 14 in the U.S., six in Europe, and one in Singapore, and we have also increased our MSU fleet to provide convenient service to customers. This past year, we restructured our parts distribution network to increase parts availability and expedite delivery worldwide, and we launched an eCommerce site that gives our customers an online option for ordering parts. And earlier this year, our 1Call solution was launched, providing customers streamlined and expedited AOG service.
What trends are impacting or will impact business jet service and support in the near future?: More than ever before, customer satisfaction is key to winning business. Customers expect impeccable service and reliability each and every time — and rightly so. It challenges us to consistently deliver the highest quality product and service to every customer who comes through our door. We recognize that delivering superior service starts well before delivery of an aircraft, making maintenance a key part in the design of our aircraft. Through our MSG-3 efforts, we are designing products that don’t require as frequent scheduled maintenance. We are certifying products with expanded calendar and time intervals. We are also constantly evaluating our internal processes to ensure we remain agile to customer issues as they arise. And of course, upcoming ADS-B requirements are on the minds of many of our customers. We have been hard at work developing solutions covering most of our aircraft models and we are here to help our customers navigate the options available to them.
Is Big Data being used by your company and, if so, how is that improving your business?: As the OEM, we have access to a vast amount of data, which only enhances the support our customers receive. One example of how use data is through our Linxus system. Extensive, real time diagnostic information is coming of the aircraft via satellite. With that data, we can effectively identify potential reliability issues and to expedite repairs. We also analyze a host of other data — whether it be warranty claims, component reliability, or unusual parts sales — to identify whether a customer out in the field is having an issue that we can solve for them.
How does your company encourage innovation?: We push to continuously innovate and be responsive to evolving customer needs and new regulatory requirements. From a product side, we have certified more new products than any of our competitors. From our recently announced Longitude to the single engine turboprop, we are continually innovating across our product lines to provide the highest level of value to our customers. Within the aftermarket, we were the first in the industry to roll out the MSU concept. And since then, we have continued to grow that service for our customers. And today, we continue to innovate in both small and large ways. From cost competitive aftermarket solutions for WiFi capability to certifying an aftermarket installation of antiskid braking for the King Air, we are constantly looking at new enhancements that provide value to our customers. Our service team is also very involved in the development of new products, integrating aircraft maintenance with aircraft design. We have a team that is charged with ensuring that we extend maintenance intervals on new products, giving our products the longest maintenance intervals in the industry.