Posted by: Amiee Category: ASCE2,NWAA news Date: Wednesday, February 15, 2012

Gordon Owen, ASCE 2 commodity group manager, writes how the NWAA’s Extended Enterprise project is helping improve collaboration between companies.

Demand from OEMs and primes to increase risk-sharing partnerships on new aircraft programmes continues to grow, along with the requirements of design and build through-life capability work packages.

This requires the North West aerospace supply chain to respond and react to ensure the long term future of the region’s aerospace sector. The additional drive by the primes to reduce their current level of supply chain interfaces, is shaping the response of the region’s aerospace sector via the ASCE 2 programme and the NWAA’s deliverance of the Extended Enterprise work stream.

The Extended Enterprise model is being developed to enable aerospace companies to form clusters of collaborative groups in order to successfully bid for work packages that they would not be able to access as independent companies. The foundation of this collaborative approach was first honed at meetings of the NWAA’s commodity group specifically designed to increase maturity and collective interaction levels.

Since the initial research phase (concluded at the end of Q2), the development and engagement phases of the Extended Enterprise work-stream are now hearing completion. This has seen increased engagement with aerospace companies, OEMs and primes to enable broader involvement and contribution towards potential model formulations.

Throughout the latter part of 2011, a number of focus group workshops have been operating, to which all NWAA ASCE member companies have been invited. It is hoped this will raise levels of awareness for the Extended Enterprise model and allay member companies’ fears and concerns, whilst also focussing on the aspirations and overall direction of how the model(s) could successfully work.

“WIIFM” (What’s In It for Me) became a well versed acronym during these focus group workshops, which formed a crucial aspect of extending the understanding of what are (currently) independent companies, in order not only to gain support for an Extended Enterprise, but also to understand what would be the final expectations of a range of customers.

An important deliverable within the development and engagement phases was the progress towards identifying the model(s) that existed and would be appropriate for further testing. During the focus group workshops, three models were considered:

Type 1, a supply chain model with primes working down their supply chain; Type 2, a joint venture company with a multi-owned subsidiary, and Type 3, a commercial alliance of companies each bringing something else to the table.

It was agreed that Type 1 is the current model, Type 2 a potential model for the future and Type 3 the preferred option. Running concurrently with the extended enterprise model(s) definition phase has been the requirement to formulate draft documents necessary to enable the lead partner model to operate within the appropriate commercial, legal and financial framework.

Governance rules have been formulated to enact the appropriate disciplines and business ethics required to enable such a collaborative alliance to function.

During the early stages of Q3/2011, five companies agreed to form the first lead partner model collaborative group. Assystem, Hampson Group, Hyde Group, Kaman and Morson-Projects, in conjunction with the NWAA, have signed a memorandum of understanding to underpin the intent of this grouping in support of the Extended Enterprise project.

Meetings have been held with Bombardier and BAE Systems to present the structure, content and direction of the lead partner model, and have received some very positive feedback, proving essential to the project at this stage of model maturity. Follow up meetings are being arranged with these prime customers, in addition to further meetings with GKN and Spirit.

The next stages of development are to work with the commodity groups to develop the model for companies to align to the lead partners and to offer that wider collective capability.