SHARING WHAT WE KNOW Boeing Employees Are Working to Manage the Company’S Collective Knowledge— and Create a Competitive Advantage

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October 2007 Volume VI, Issue VI

www.boeing.com/frontiers SHARING WHAT WE KNOW Boeing employees are working to manage the company’s collective knowledge— and create a competitive advantage

October 2007 BOEING FRONTIERS October 2007 Volume VI, Issue VI October 2007 Volume VI, Issue VI

www.boeing.com/frontiers SHARING WHAT WE KNOW ON THE COVER: Associate Boeing employees are working to manage the company’s Technical Fellow Jim Coogan collective knowledge— and create a competitive advantage works with Emily Hoelting of Delta/United Launch Alliance. Photo by Michael Gail oto h Gail Hanusa p COVER STORY KNOW AND SHARE 12 Boeing’s Duc Le (left) consults with Pat Riedl, a Boeing retiree, on 787 wiring design processes. Boeing employees are taking part in various efforts to manage the company’s collective knowledge. Here’s an explanation of why this is important to Boeing.

The Netherlands is a nation where internationalism, inno- LOW LAND, 28 vation and environmental concern converge. These quali- FEATURE ties strengthen the relationships between Boeing and the company’s HIGH IDEALS Dutch customers and supplier partners—to everyone’s benefit. STORY

BOEING FRONTIERS October 2007 October 2007 Volume VI, Issue VI

Boeing’s Kathy Landino, an FAA Designee, guides her signed Airworthiness Certificate into its holder 18 above the door in a Boeing 737 airplane. All Boeing A glance all around jetliners must have an original Certificate of Air- What’s the home of the world’s fastest digital panoramic worthiness before being delivered to and operated camera? Boeing. Here’s a peek at what can be done with by a customer for commercial service. 22 this camera—which is based on an existing camera system and can take a 360-degree picture in a single pass. A world of opportunity U.S. Defense Department expenditures are expected 24 to flatten, according to most forecasts. That’s why Integrated Defense Systems is focusing increasing attention overseas. In fact, international customers represented 13 percent of IDS revenues in 2006—almost double the share of five years ago. Looking forward Boeing is undertaking many activities as it works to 34 build and maintain a long-term presence in Korea. These range from supporting its Korean customers to relying on the nation’s suppliers and undertaking activities that support Korea’s people. Marian L ock h art p h oto Stamp of approval Meet Boeing’s Kathy Landino, who’s authorized to 18 issue U.S. Federal Aviation Administration Certificates of Airworthiness for Boeing jetliners after they are flight- tested. The work of Landino and her fellow FAA airworthiness Photographer Ron Bookout documents the designees plays a major role in ensuring that Boeing delivers on C-17 flight deck manufacturing process. This the promises it makes to customers. 22 work is being done with a new panoramic camera system. P eter Geor g e p h oto

6 Letters 8 Historical Perspective 45 Stock Charts 48 Around Boeing INSIDE 7 Notebook 10 New and Notable 46 Milestones 50 Spotlight

October 2007 BOEING FRONTIERS As part of its Project Wedgetail airborne early warning and control program, Australia has pur- 24 chased six 737 AEW&C aircraft. Boein g p h oto Where careers lift off Special deliveries Huntsville, Ala.—also known as “Rocket City”—has To help manage an upswing in airplane deliveries, the 38 more engineers per capita than any other city in the 42 Contracts organization of Commercial Airplanes has United States. Here’s a look at some of the work performed at developed a new airplane-delivery process. The goal: Imple- the Boeing site in Huntsville, as seen by several of the facility’s ment leaner, more-efficient and more-responsive processes and employees. systems that increase customer satisfaction.

Korean Air representatives watch the recent delivery of their new 777-200ER from the 42 second-story window of Boeing’s Everett (Wash.) Delivery Center. The Contracts organization of Commercial Airplanes has made improvements in the delivery process to enhance the experience for customers. Wantz p h oto Willia m Wantz

BOEING FRONTIERS October 2007 n LETTERS

“A Boeing transit system for employees Editor’s note: Ken Botham, Shared Services Group would in the long run make the company General Services senior manager and the person who Publisher: Tom Downey more productive.” Editorial director: Jo Anne Davis manages Boeing commuting —Martin Nix, Renton, Wash. matters in the Puget Sound EDITORIAL TEAM area, provided this response: Editor: “Thank you for shar- Paul Proctor: (312) 544-2938 ing your comments. My team Managing editor: Washington, the other and I recognize the concerns Junu Kim: (312) 544-2939 up the east side of Lake you’ve listed and are working Designer: Washington, and the other continuously to improve the Rick Moore: (314) 233-5758 to the south. commute for Boeing employ- Commercial Airplanes editor: This system would ees in the Puget Sound area Dick Schleh: (206) 766-2124 have two levels. The first and across the enterprise. Integrated Defense Systems editor: level would be micro- Please note that in the Puget Diane Stratman: (562) 797-1443 buses once every 10 or Sound area, Boeing works Engineering, Operations and 15 minutes, all day long. with local authorities to help Technology editor: The other system would build better public transit William Cole: (314) 232-2186 be macrobuses, and these routes. In addition, our com- Shared Services editor: would run express during muting resources for the area Mick Boroughs: (206) 919-7584 shift changes—going, for include carpool and vanpool Copy editor: example, express from programs. However, at this Walter Polt: (312) 544-2954 Everett to Renton. time, a private bus system is CONTRIBUTING EDITORS Granted, not everyone not feasible because of the Boeing Capital Corp.: would use it, but it would varying needs of employees.” Donna Mikov: (425) 965-4057 make it easier for many For more on commuting to join vanpools and car- options, please visit http:// ONLINE PRODUCTION pools. Someone could drive an commuting.web.boeing.com Production manager: A free ride to work? electric car to Renton, and work on the Boeing intranet and Alma Dayawon: (312) 544-2936 oeing should follow the in Everett, for example. click on your geographic area Web designer: Brecent lead of Microsoft, Why should we do it? Traf- of interest. Michael Craddock: (312) 544-2931 which is planning to start up a fic congestion will only get Graphic artists: mini–transit system for its em- worse as the region’s population Corrections Rick Moore: (314) 233-5758 ployees in the Seattle area. The increases. The price of gasoline Cal Romaneschi: (312) 544-2930 • The caption for the photo system would feature micro- is rising (the transit system on Page 16 of the September Web developers: buses that would have bicycle would operate on alternative 2007 issue incorrectly identi- Lynn Hesby: (312) 544-2934 trailers and also offer WiFi Keith Ward: (312) 544-2935 fuel). A building-to-building fied what object was being Internet access on board. transit system would solve a lot inspected by Boeing employ- Information technology consultant: I think Boeing could put in Tina Skelley: (312) 544-2323 of overloading of parking. And ees Ken Scherban and Richard a frequent-service transit sys- it would save employees the ex- Tolman. They were inspecting tem in the Puget Sound area pense of driving to work. a Common Strategic Rotary How to contact us: of Washington state. It would Similar ideas can be done Launcher. E-mail: be nice if the system had WiFi for Boeing locations outside the • The caption for a photo [email protected] on board, so employees can do Puget Sound area. on Page 43 of the August 2007 Mailing address: work while going to work. I contend that a Boeing issue incorrectly identified in Boeing Frontiers This new system would transit system, just for Boeing which state the U.S. town of MC: 5003-0983 also handle company mail and employees (and contractors), 100 N. Riverside Plaza Pass Christian is located. Pass Chicago, IL 60606 company cargo—thus helping would in the long run make Christian is in Mississippi. pay for itself. Longacres (the Phone: the company more produc- (312) 544-2954 Boeing Commercial Airplanes tive—and help reduce the cost Fax: headquarters building) could be of transportation. (312) 544-2078 a “grand central station” with —Martin Nix Web address: three routes radiating out: one Renton, Wash. www.boeing.com/frontiers up the west side of Lake Send all retiree address changes to Boeing Frontiers, MC 3T-12 P.O. Box 3707 Seattle, WA 98124-2207 Letters guidelines Postmaster: Send address corrections Boeing Frontiers provides its letters page for readers to state The opinions may not necessarily reflect those of The Boeing to Boeing Frontiers, MC 3T-12 their opinions. The page is intended to encourage an exchange Company. Letters must include name, organization and a tele- P.O. Box 3707, Seattle, WA 98124-2207 of ideas and information that stimulates dialogue on issues or phone number for verification purposes. Letters may be edited (Present addressees, include label) events in the company or the aerospace industry. for grammar, syntax and size.

October 2007 BOEING FRONTIERS n NOTEBOOK

SNAPSHOT A STORM’S A-BREWIN’ This view of Hurricane Felix over the Caribbean Sea was taken in early September from the International Space Station by an Expedition 15 crewmem- ber. Boeing is the prime contractor for the ISS. NASA PHOTO

QUOTABLE

he 787 “opens up a t makes us feel alive and e planned the flight whole new continent for very involved and equal almost a year ago Tus.” Iparticipants in the Boeing Wand achieved it on —Edward C. Freni, aviation director for the workplace.” schedule.” Massachusetts Port Authority, which runs —Marty Rabu, a Boeing tooling technician in —Mark Ellis, Boeing Peace Eagle program Boston’s Logan International Airport, on the Winnipeg, Manitoba, on how using a BlackBerry manager, on the late-August first flight of ability of the 787 to conduct nonstop flights wireless communication device has improved a 737 Airborne Early Warning and Control from Boston to Asia, in the Sept. 14 Boston the work environment for deaf employees such aircraft for Turkey’s Peace Eagle program Globe as him, in a Sept. 12 CBC News story. For more on this subject, see Page 17 of the February 2006 Boeing Frontiers

IAM PROMOTIONS ETHICS QUESTIONS? No promotions listed for periods ending You can reach the Office of Ethics & Business Conduct at 1-888-970-7171; Mail Code: 14-14; Fax: 1-888-970-5330; Aug. 31 and Sept. 7, 14 and 21 TDD/TTY: 1-800-617-3384; e-mail: [email protected]; Web site: http://ethics.whq.boeing.com

BOEING FRONTIERS October 2007 n HISTORICAL PERSPECTIVE

The Boeing-built E-3 Airborne Warning and Control System has helped the U.S. Air Force achieve and maintain air 30 years supremacy for more than 30 of air supremacy years. B OEIN G P H OTO

By Jennifer Hogan the rest of the first crew waited for their providing situational awareness to com- new bird, tail number 75-0557. Hardy and mand centers and tactical aircraft. A real- or 30 years, the Boeing-built E-3 Air- his peers had already received their check- time dynamic picture of the battle space borne Warning and Control System out from Seattle, and he was one of the first built by the AWACS sensors and displayed F(AWACS) has helped the U.S. Air two instructor pilots for the E-3. on the mission crew consoles is shared Force achieve and maintain air supremacy. “The early years of the E-3 were fo- with the entire network. This picture is It’s supported every major U.S. military cused on training and selling the capabil- worth more than a thousand words. operation and conflict from the Cold War ity of the plane to fighter groups within the * * * to today’s global war on terror. Following Air Force,” said Hardy, today the Boeing John Howell remembers his time in the are accounts from retired U.S. Air Force site manager for AWACS programs in North Atlantic during the end of the Cold members who have lived the history of the Oklahoma City. “It took about three years War. Howell was the squadron commander E-3—flying and maintaining the aircraft before the E-3 gained acceptance among for the 960th Airborne Warning and during the last three decades—and who the fighters.” Control Squadron. since have joined Boeing. Their stories Although the E-3 was ahead of its time, “The fighters did not have today’s sat- cover the history of the AWACS and hint it had computing capacity comparable to ellite links. They relied heavily on the at what’s in store for the future. the early Commodore 64 personal comput- AWACS to identify the Russians as they * * * er, with nine black-and-white consoles and entered the Greenland–Iceland–United Maury Hardy was standing on the flight eight ultrahigh frequency radios. Today it Kingdom gap off the coast of Iceland,” said line as the first E-3 AWACS was delivered boasts 14 full-color consoles and 14 UHF Howell, now a Boeing field marketing rep- to Tinker Air Force Base, Okla., in March radios with Joint Tactical Information resentative at Warner Robins Air Logistics 1977. Excitement was in the air as he and Distribution System (JTIDS) data links Center, Ga. “At the end of (U.S. President

October 2007 BOEING FRONTIERS n HISTORICAL PERSPECTIVE

In this late 1970s photo, Maury Hardy (left) is shown with U.S. Air Force team- mates who made up the first E-3 crew. Today, Hardy is the Boeing site manager for AWACS programs in Oklahoma City. The early years of the E-3 were focused on training and selling the capability of the plane to fighter groups in the Air Force.

Boeing E-3 provided radar coverage, and a Boeing KC-135 refueled the F-15s and E-3 as needed during the long flight. “This shows the importance of Boeing to U.S. defense and underscores why a company like ours must have the highest ethi- cal standards,” Robinson said. * * * What does the future hold for the AWACS and its crews? First and foremost, many more years of service. The upcoming Block 40/45 upgrade is the largest single improvement in the history of AWACS. “Block 40/45 will start in 2011 with sys-

U . S AIR F ORCE P H OTO tem upgrades that will bring the AWACS into the 21st century,” said Kirk Warburton, Ronald) Reagan’s tenure, Russian Premier ed with the news—the World Trade Center a retired Air Force major who’s now a Mikhail Gorbachev was challenged to tear in New York City had been hit. Network Centric Operations development down the Berlin Wall. When the wall came “We knew immediately this was an at- and integration manager for Boeing. down, it was the greatest satisfaction and tack, and we began planning for our coun- “The E-3 will feature multisource in- accomplishment. All of us who worked the try’s safety,” Robinson said. Two E-3s had tegration, providing improved target iden- missions knew we had prevailed.” already been deployed that morning on tification and tracking,” Warburton said. * * * training sorties. They were immediately “There will be improved data-link integra- Chuck Winstead was in one of five diverted, one to Washington, D.C., and the tion, ensuring the most important tracks E-3s that were airborne over Iraq on the other to Florida. The latter would escort receive the highest priority. This will aid first night of Desert Storm in 1991. A hos- President Bush there for many hours. the mission crew while they are communi- tile MiG-29 aircraft was spotted flying Bush was aboard the 747 known as Air cating with the fighter.” n over western Iraq, and Winstead’s crew di- Force One, Boeing F-15s were his escort, a [email protected] rected the first strike of the war. “Everyone sent to fly into Iraq had to check in with an AWACS first,” said Winstead, now the director of Integrated Command & Control at Boeing. “We or- chestrated their fuel, provided threat warning and air-target point out, contacted them after the mission and connected them back with the tankers for refueling before heading home.” * * * Today, Ben Robinson is the KC-135 program director and Boeing’s Oklahoma City site director. Six years ago, he was Brigadier Gen. Robinson, commander of the AWACS 552nd Air Control Wing. On the morning of Sept. 11, 2001, as he and the other commanders at Tinker Air Force Base began a meeting, they were interrupt-

Ben Robinson (standing, fourth from right) was a part of the 1,000th mission flown by AWACS in 1982. Robinson now is the KC-135 program director and the

Oklahoma City site director for Boeing. U . S AIR F ORCE P H OTO

BOEING FRONTIERS October 2007 n NEW AND NOTABLE

The Orbital Express system successfully completed its on-orbit satellite-servicing demonstrations this summer. Here, OE’s NextSat satellite is seen in a photo taken by the Boeing-built Autonomous Space Transport Robotic Operations (ASTRO) 2 for 2 spacecraft of OE. ASTRO was approaching to perform a soft capture. . Tech demo spacecraft achieve objectives

By Marc Sklar

he cost of a satellite designed to orbit as far as 23,000 miles (37,000 kilome- Tters) in space can run in the hundreds of millions of dollars. No wonder owners and builders are always looking for ways to increase the capabilities and extend the lives of these modern marvels. Two Advanced Systems technology demonstration successes, the Orbital Express (OE) and CubeSat TestBed1 (CSTB1), could help Boeing deliver on all of the above for satellite customers. Advanced Systems is the Integrated Defense Systems group responsible for developing new technologies and products for IDS businesses, including Space and Intelligence Systems, the IDS satellite business. Over the spring and summer, OE and CSTB1 completed all of their primary mission objectives. SERVICE STATION IN SPACE OE is made up of two vehicles, the Boeing-built Autonomous Space Trans- port Robotic Operations (ASTRO) and NextSat, a spacecraft developed by Ball Aerospace. ASTRO acted like a combina- tion service station and repair truck, working on NextSat. NextSat was built to dem- d R esearc h P rojects Ag ency Boein g i m a e courtesy o f De ense Ad vance onstrate a satellite with components that • Capturing a free-flying space vehicle tomers,” said Alex Lopez, vice president, could be replaced and the capability to be and transferring components using an au- Advanced Network and Space Systems. refueled while on orbit. tonomously operated robotic arm with its “Orbital Express offers the possibility of OE, sponsored and led by the Defense own onboard video sensors, and with the replacing a failed component or replenish- Advanced Research Projects Agency, ability to correct for errors without outside ing fuel rather than writing off an on-orbit demonstrated a variety of on-orbit firsts, inputs. satellite that is otherwise healthy and func- including tioning.” • Capturing and servicing a satellite powerful picosatellite Lopez noted that design elements eval- without help from the target satellite. Meanwhile, CSTB1 is a picosatellite uated by CSTB1 can be incorporated into • Using onboard navigation and guid- (satellite weighing less than 2.2 pounds or larger spacecraft. That could reduce vol- ance to approach and station-keep (hold 1 kilogram) used for a variety of technol- ume, mass and power needs for the main position) within 10 centimeters (4 inches) ogy demonstrations. spacecraft bus (the core physical and elec- of another satellite. CSTB1 is evaluating technologies, de- trical structure of a satellite) and increase • Using an IEEE 1394–standard sign elements, and attitude (orientation) resources available for mission and pay- high-speed data connection—known on determination and control approaches load needs. personal computers as a FireWire con- for future operational nanosatellites (sat- So, when communications companies, nection—that allowed ASTRO to remove ellites weighing less than 22 pounds or governments and other satellite buyers go and replace its own sensor computer. 10 kilograms). shopping in the future, this summer’s twin • Transferring propellant from one “Both of these programs have shown test successes could make Boeing an even space vehicle to another using U.S.-built potential applications that could add value better place to buy. n technology. and/or cut costs for Boeing’s satellite cus- [email protected]

10 October 2007 BOEING FRONTIERS n NEW AND NOTABLE A grand achievement

777 program tops In August, the 777 Program surpassed the 1,000-order mark 1,000-order milestone when TAM Airlines placed an order for four 777-300ERs. To By Chuck Cadena date, the 777 has won 1,004 orders from 52 customers n Aug. 23, Boeing posted an order around the world. for four 777-300ERs from an un- Oidentified customer that put the order tally for the 777 past 1,000. The 777 Program reached this milestone faster than any previous twin-aisle commercial airplane program. The customer for that order was later identified as TAM Airlines, Brazil’s largest airline. “We have continually enhanced and improved the performance of the 777 family of airplanes,” said Larry Loftis, vice president, Boeing 777 Program. “Today, we have grown that family to include two new longer-range 777s and a freighter ver- sion that will enter service in the fourth quarter of 2008.” “Two major reasons the 777 has been such a success are the versatility of the airplane’s basic design and the pioneering philosophy that the 777 be service-ready e d turner p h oto to fly routes requiring extended operations rules,” said Bob Buchholz, a re- “Having worked product strategy for Morden noted how the in-service per- tired engineer with 36 years of service the 777 since its inception, I am gratified formance of the 777 proved the efficiency who last served as chief engineer for to see orders go past 1,000,” said Dennis and reliability of twin-engine airplanes for 777 Performance. Morden, 777 product manager, Commer- long-haul operations. Buchholz noted how ensuring the 777 cial Airplanes Product Strategy. “It has “Today, even our competitor is plan- was ready to fly routes under extended been a privilege to be associated with a ning to use a twin-engine airplane to re- operations rules when it entered service re- program where each of the models intro- place its four-engine intermediate-size moved a key advantage of the 777’s four- duced delivered more than was promised airplanes,” Morden said. n engine competitor. Similarly to how the to our customers.” [email protected] 767 opened trans-Atlantic routes using extended operations, the 777 opened routes across the north Pacific and over the North Pole for twin-engine airplanes. By the numbers: 777 Program Here’s a look at some of the numbers behind the achievements of the Boeing 777 Program since APPRECIATED BY FLIERS the jetliner entered service 12 years ago: Yet it’s not just airlines that appreciate the jetliner. The flying public has taken a The number of orders received to date for the 777 from 52 customers. In addition, liking to it as well. Since its introduction, 1,004 two airlines operate 777s through lease only. the 777 has consistently held more than The number of people the 777 fleet has carried worldwide since 60 percent market share, and passenger surveys have shown a preference by fliers 778 million the airplane entered service June 7, 1995. for the 777. The number of nautical miles the 777 fleet has flown to date (13 billion “After 12 years in service, the 777 re- 7 billion kilometers), equivalent to 322,000 trips around the world. mains the preference of airlines and passengers around the world,” said Suzanna The number of cumulative flight hours for the 777 fleet on more Darcy-Hennemann, the chief pilot for the 14.5 million than 3.3 million flights, which includes more than 1 million flights 777 Program. under extended operations rules.

BOEING FRONTIERS October 2007 11 KNOWLEDGE MANAGEMENT

n COVER STORY

Get our heads into it Each Boeing employee has job-related knowledge. Here’s what steps the company is taking to manage and share this collective information— and use it as a competitive advantage

By Debby Arkell KNOWLEDGE MANAGEMENT

12 October 2007 BOEING FRONTIERS KNOWLEDGE MANAGEMENT KNOWLEDGE MANAGEMENT KNOWLEDGE MANAGEMENT

n COVER STORY T N E M E G A N A M E G D E L W O N K

t’s been said that knowledge management is 35,000 years old, dating back to the days when—as a matter of survival—a ICro-Magnon scratched information in the form of petroglyphs on a cave wall. While methods used at Boeing today may be different, sharing knowledge is no less a matter of survival. Get our In the last 15 years, economic, social and technological changes have dramatically altered the workplace and the way employees work. Globalization has brought new opportunities and increased competition. To boost productivity and profits, organizations have responded by merging, acquiring, re-engineering, streamlining and outsourcing. However, some of these work force changes resulted in a loss of institutional knowledge. At the same time, skilled workers—including those who have expertise in technical areas such as engineering—are in high demand, and it can be difficult for organizations to attract and retain employees with needed skills. Economic conditions also have given workers more flexibility to change jobs in search of bigger and better deals. When an employee leaves a company, he or she also reduces that organization’s collec- heads tive knowledge. The demand for knowledge management will only accelerate as the post–World War II “baby boom” generation looks toward retirement. The oldest members of the U.S. baby-boom generation are in their early 60s. Indeed, today 18 percent of Boeing employees are eligible to retire, while another 19 percent will be eligible in five years, and another 40 percent in 10 years, according to Boeing into it Human Resources. Making these figures even more critical: According to knowledge management experts at Boeing, 80 percent of what a company “knows” resides in its employees’ minds, while only 20 percent resides in repositories such as file shares, documents and wikis. Boeing, like many companies worldwide, faces the challenges of an aging work force, increasing demand for critical skills and work- placement decisions, and decisions on how to support programs where the product will outlast the tenure of the talented people who designed and built it. Yet unlike many companies, Boeing leaders across the enterprise know the solution to these challenges, and they are beginning to value and protect knowledge assets. Boeing’s goal: to foster an environment where knowledge and the strength of its culture can be leveraged quickly to empower an adaptable, agile work force and improve productivity. “We have machines, buildings and tools,” said Jim Walden, for- mer leader of the Knowledge Management and Benchmarking team

BOEING FRONTIERS October 2007 13 KNOWLEDGE MANAGEMENT KNOWLEDGE MANAGEMENT KNOWLEDGE MANAGEMENT

n COVER STORY

for Integrated Defense Systems. “But what distinguishes Boeing job shadowing and mentoring; text, electronic and video archives; from other companies is its knowledge assets—what markets to the Initiatives Database; Communities of Practice; even storytell- approach; how to approach them; how to design, build and support ing at events such as Excellence Hours and “brown-bag lunches.” our products. How we manage that knowledge is a market differ- “Communities of Practice—knowledge-sharing communi- entiator for Boeing, and it’s our people who hold the key.” ties—are truly the most effective way to share information: vol- untary groups of people who are passionate about a subject,” said What is knowledge management? Jim Coogan, Knowledge Management Associate Technical Fellow, Knowledge management, loosely defined, is a disciplined, who also leads the Boeing Knowledge Management Community of holistic approach to using expertise effectively for competitive ad- Practice. “However, ultimately the key to knowledge management is vantage. At Boeing, knowledge management is made up of a com- to put the right tools in place—tools that are not intrusive and that fit prehensive system of processes, tools, methods and techniques that the way people work—because people all work differently.” enable employees to capture and share information effectively. It’s important to note that Boeing’s business units and the peo- “Raw data, when organized, becomes information that, ple within them all manage knowledge differently, with some when put into context, becomes knowledge,” said Jeanne Blue, techniques resonating more than others. Standardized knowledge- Commercial Airplanes Technical Excellence and Knowledge management efforts can be difficult to undertake at Boeing. Not Management, at a knowledge management forum this year. only do people learn in different ways, but Boeing sites may have “Knowledge, when fine-tuned and combined over time with prac- different needs. Despite these differences, knowledge manage- tical experience and prudence, becomes wisdom. Sharing and ment leaders at Boeing agree that driving a knowledge-sharing leveraging wisdom across the organization leads to innovation and culture is a top priority, while the various tools are knowledge- a competitive advantage for Boeing.” management enablers. Boeing has many methods and tools already in place to facili- The Engineering, Operations & Technology organization at tate knowledge management, including training; career coaching; Boeing is beginning to drive the knowledge-management culture KNOWLEDGE MANAGEMENT Gail Hanusa p h oto Boeing 787 Systems Integration Processes and Tools teammate Duc Le (left) consults with Pat Riedl from YourEncore on 787 wiring design processes. Riedl, a Boeing retiree, has extensive experience in systems integration; now, through his work with YourEncore, Riedl can share his knowledge with newer workers on the 787 program.

14 October 2007 BOEING FRONTIERS KNOWLEDGE MANAGEMENT KNOWLEDGE MANAGEMENT KNOWLEDGE MANAGEMENT

n COVER STORY

Knowledge management in action critical training and insights from them as part of the company’s “onboard- Knowledge management uses a wide range T of tools N and E methods M to help E G A ing” activity. N The A video M files are kept E available G so D employees E can L use them W as O N K capture and share information. These solutions rely as much on organizational refreshers or reference materials to support ongoing job requirements. processes as on technological processes. Indeed, because Boeing’s busi- * * * * * * * ness units and the people within them manage knowledge differently, some The Initiatives Database helps accelerate the rate at which best practices techniques resonate with some organizations more than others. can be shared and replicated across the company. The Initiatives Database Below are examples of KM in action at Boeing. provides a repository of information for programs and functions to locate and * * * * * * * replicate best practices and tracks high-leverage, initiatives-related projects more effectively. It also is a tool senior leaders will use to track and measure Engineering is one organization at Boeing that is facing critical skill issues due their teams’ progress in implementing and replicating projects that support the to retirement eligibility and new-program growth. As such, it’s keenly focused company’s four growth and productivity initiatives: Lean+, Internal Services and motivated to identify and retain critical skills and knowledge. Productivity, Global Sourcing and Development Process Excellence. Commercial Airplanes Engineering recently began using knowledge manage- * * * * * * * ment assessment tools to close gaps in skills needed versus skills available. The tools help assess what skills are needed, what skills are in the group Boeing currently offers an internal “wiki” service for use by employees already, and the gap between the two. These assessments take into consider- (http://blogwikiservices.web.boeing.com on the Boeing intranet). In the same ation the kind of work being done now and planned for the future, as well as family as virtual team rooms and blogs, wikis are online collections of informa- technology changes, work placement decisions and more. Assessment results tion input by users. Readily accessible to all users, wikis are a quick and help Engineering leaders develop plans to close the gap, typically including easy means for employees to share knowledge. For example, a small Safety, training, mentoring, Communities of Practice, and Performance Evaluation and Health and Environmental Affairs team uses a wiki to track things related to Performance Development Partnership processes. federal- and state-level water regulations, gathering and posting the information—without requiring a webmaster to do the posting. Similarly, Integrated Defense Systems Engineering is defining a pilot program where an organization can use assessment tools to identify needs, then take However, wikis are more than a knowledge repository. Information in wikis also the results and use a self-help translator to review likely scenarios they’re can be modified by all users through their Web browsers. This means that one facing—and suggested solutions. person or group no longer is the sole “owner” of information, and data can be checked by thousands, not just a few. Creating or participating in wikis or blogs * * * * * * * carries substantial personal and professional responsibility. Employees should YourEncore helps companies accelerate innovation by leveraging the exper- review the Boeing blogging guidelines on the Boeing intranet at http://inside. tise of retired scientists and engineers. Established in 2004 by Boeing, boeing.com/media_guidelines before setting up a blog or wiki. Procter & Gamble and Eli Lilly, YourEncore recruits retired Boeing engineers, * * * * * * * scientists and technical workers—as well as retirees from many other companies, academic institutions and government agencies—to act as consultants Communities of Practice are a powerful means by which information can be to Boeing and other companies on a project basis. Expertise provided includes shared. In knowledge-management circles throughout Boeing, Communities key technical support, guidance and independent analysis, strategic and of Practice are considered one of the more prominent face-to-face methods of high-level consultations, advice and technical strategy, and help mentoring knowledge sharing. and training the “next generation” of technology leaders. Contracting with The Ed Wells Partnership, a Renton, Wash.–based joint initiative between Boeing YourEncore helps Boeing mitigate the potential “brain drain” that results from and the Society of Professional Engineering Employees in Aerospace, regularly increasing numbers of technical workers eligible for retirement. Also, YourEn- holds classes to teach employees about Communities of Practice and how they core offers Boeing retirees the opportunity to work on challenging technical promote knowledge sharing. These classes encourage collaboration among projects with other Fortune 500 companies in a variety of industries. For more Communities of Practice leaders from around the company and provide a forum information, visit www.yourencore.com. to share lessons learned, new tools and other expertise. Employees can promote * * * * * * * other communities, and help sustain existing ones. EWP also hosts a forum to address unique issues faced by Boeing Communities of Practice leaders called Video capture has proven to be an excellent way to retain and transfer critical “CoP squared,” made up of more than 50 members across organizational and program knowledge, especially from single sources of information. The Delta geographic boundaries. program has used this knowledge-retention tool successfully for a number of years. Overviews, training classes, discussions among subject-matter experts, * * * * * * * infrequent but critical events, and presentations of program best practices all The Boeing Northwest Technical Excellence Knowledge Management have been videotaped. forum, held this past May in Seattle, drew nearly 300 employees, represent- The completed videos feature slides of text that are synchronized to the ing all business units from 12 states, and was designed to allow knowledge videotaped footage. Each video product is indexed by topic so the viewer can management user communities to talk with others about what did and didn’t decide which parts to watch. The final product can be viewed over the Web on work in their groups. Next steps for the group include exploring ways to share a standard PC station or distributed in a DVD format. program-specific lessons learned and best practices, as well as how to address knowledge-management issues that cut across program boundaries. Captured Video Products are now an important part of transferring Delta knowledge as the program becomes part of the newly formed United Launch —Debby Arkell Alliance. New employees at ULA can initially review the videos and receive

BOEING FRONTIERS October 2007 15 KNOWLEDGE MANAGEMENT KNOWLEDGE MANAGEMENT KNOWLEDGE MANAGEMENT

n COVER STORY m ic h ael g ail p oto Delta/ULA employee Emily Hoelting works with IDS Knowledge Management Associate Technical Fellow Jim Coogan as she edits an instructional video. The Delta rocket program has used this knowledge-retention tool successfully for a number of years; captured video products are now an important part of transferring Delta knowledge as the program becomes part of the newly formed United Launch Alliance.

across the company. EO&T is considered to be the “functional home” for knowledge management within Boeing’s technical or- Why is knowledge management ganizations, and it is starting to pull at common threads from BCA important to Boeing? and IDS’ knowledge-management efforts. Knowledge management matters to Boeing for many reasons. EO&T is assembling a framework for business units and groups Among them: to evaluate their knowledge-management challenges. That framework includes using assessments to determine a group’s knowledge • Retains expertise of employees who leave the company needs and scenarios, as well as recommend proven solutions. • Shares expertise, best practices and lessons learned across Yet even with common overarching goals, all agree that the enterprise what works in one place might not work for another. “While • Avoids reinvention and accelerates innovation knowledge-management concepts are applicable to every Boeing group, knowledge management isn’t a one-size-fits-all solution,” said Pam Eakins, leader of the EO&T-sponsored knowledge- management effort. “That’s why we’re using a framework approach, to provide structure but allow flexibility for solutions based on organizations’ specific needs.” It’s our future Walden said that organizations such as Finance, Supplier Management, Program Management and Human Resources share Actions cited in this story show how employees are applying con- similar challenges. “We’re automating and getting leaner, so the cepts of the Boeing Management Model to support the company’s nature of our work is changing,” he said. “A lot of what we do cen- business strategies. Here’s how. ters on how our brains use systems to create data, organize it and • Growth and productivity: Efforts let Boeing share and retain turn it into knowledge—and then share it. Our work is heading in its employees’ collective knowledge—and prevent the need the direction of a ‘knowledge organization.’”

KNOWLEDGEto duplicate effforts or reinvent solutions. MANAGEMENT Who owns this know-how? To learn more about the Management Model, visit http://bmm.web. As Boeing becomes more and more integrated through com- boeing.com on the Boeing intranet. mon processes, languages and tools, knowledge becomes an increasingly important asset to the company, not just one business

16 October 2007 BOEING FRONTIERS KNOWLEDGE MANAGEMENT KNOWLEDGE MANAGEMENT KNOWLEDGE MANAGEMENT

n COVER STORY

Wheel of knowledge

Knowledge management at Boeing T takes N a holistic E approach M E G A N A M E G D E L W O N K to using knowledge for competitive advantage. The knowledge management model, shared by Commercial Airplanes and Integrated Defense Systems, depicts the “life cycle” of knowledge management, from knowledge creation through retirement. Knowledge and learning are part of a continuous cycle: The retirement of some knowledge can lead to the creation or discovery of newer, more up-to-date information. Organizational knowledge and culture are at the heart of a system of processes, tools, methods and techniques designed to identify, capture, retain and otherwise manage knowledge through its life cycle.

unit. This becomes the foundation for a successful knowledge environment and allows for sharing, communication and finality of information. Therefore, knowledge management is considered a business imperative, and one that can be used for competitive advantage, knowledge-management leaders said. Consider this: In past generations, airplane assembly mechanics worked in a factory where products were developed, built and de- B OEIN G RAP H C livered under one roof. Today an increasing percentage of Boeing work is performed using information systems and programs in For more information which products are designed jointly and virtually worldwide. For more information about knowledge management at Boeing and In fact, Boeing has one of the largest human network opera- related topics, visit these Web sites on the Boeing intranet: tions around, made up of approximately 160,000 people. “If we don’t know what others are doing, we end up repeating mistakes,” • Integrated Defense Systems Knowledge Management. Employ- Coogan said. “I have a vision for the future called ‘knowledge- ees can learn how to get started with knowledge management, find centric’ operations—where knowledge becomes connected in the out about Communities of Practice, register their knowledge man- way network-enabled operations are being developed today, so agement activities and much more. http://idskm.web.boeing.com. where there’s a knowledge or skill void, or need, resources auto- • Commercial Airplanes Engineering & Manufacturing Knowledge matically shift to fill it.” Retention and Sharing. This site explains the objectives of the Blue noted that Boeing doesn’t pursue knowledge management KR&S effort and provides guidance, processes and tools to deter- just for its own sake. “It’s not a goal in and of itself,” she said. mine organizational competencies and comprehensively assess “There are tangible business benefits that result when we improve knowledge and skill needs and gaps. It also offers recommended the way we capture, retain, share and use knowledge. It enables us knowledge-transfer methods for closing those gaps. to be more productive and efficient, more innovative, and provide http://knowledge.ca.boeing.com. higher-quality products and services.” Knowledge management can increase customer and employee • Boeing Knowledge Sharing Community Gateway. This site offers satisfaction, reduce risk and flow times, and reduce costs as well. resources for starting knowledge-sharing communities. It includes “The value of knowledge never depreciates,” Coogan said. “We links to training material, articles and best practices. must optimize knowledge flow by focusing on culture, people, pro- http://copgateway.web.boeing.com. cesses and technology—and in that order. Studies show time and • Northwest Technical Excellence Knowledge Management again, knowledge-management efforts fail that are restricted to a Forum. The Web site for this year’s event, which took place in May, technology solution.” offers the PowerPoint presentations given by the event’s speakers. As cultures can vary even from site to site at Boeing, it’s imper- http://btec.web.boeing.com/kmf. ative that Boeing teams gain better understanding of cultural and people issues, Coogan said. • Ed Wells Partnership. The Ed Wells Partnership, a joint initiative “BCA manages knowledge differently than IDS, partly because between Boeing and the Society of Professional Engineering BCA manufactures a single product line; IDS manufactures mul- Employees in Aerospace, has a program devoted to knowledge tiple, varied products,” he said. “Both groups have very passionate management at Boeing. The organization’s Web site offers people, and what works in one place might not work for another.” information on Communities of Practice, along with other ways of Understanding cultural and people issues will result in common knowledge sharing. http://edwells.web.boeing.com. processes that can be used to share knowledge seamlessly. In addition, the organization YourEncore offers retired employees the “We must capture and transfer information in a manner that’s chance to serve as consultants to Boeing and other companies on a invisible—knowledge without borders,” Coogan said. “In so do- project basis. Boeing helped establish YourEncore in 2004. For more ing, the difference will be between our ability to merely capture information, visit the group’s Web site at www.yourencore.com. the high ground or to be the ones who go out and set the high ground.” n [email protected]

BOEING FRONTIERS October 2007 17 KNOWLEDGE MANAGEMENT KNOWLEDGE MANAGEMENT n COMMERCIAL AIRPLANES That’s the ticket! How an FAA Designee helps ensure that Boeing delivers on its promises

Kathy Landino, an FAA Designee, begins an inspection during a night shift. FAA Designees support Boeing manufacturing around the clock with three shifts. Every Boeing jetliner needs an Airworthiness Certificate before it’s delivered to a customer. Marian L ock h art p h oto

By Bev Holland hold a number of positions at BCA, in- The efforts of Landino and her fellow FAA cluding final assembly inspector and airworthiness designees play a major role hen Kathy Landino joined customer quality support representative. in ensuring that Boeing delivers on the Boeing Commercial Airplanes Today she’s one of eight authorized indi- promises it makes to its customers. These Win July 1977, she had no idea that viduals at the Boeing Delivery Center in designees are authorized to conduct FAA 30 years later her name would be on the Seattle who perform U.S. Federal Avia- conformity inspections—meaning that airworthiness certificates for a good por- tion Administration conformity inspec- they’re empowered to confirm the airwor- tion of Boeing 737 airplanes flying today. tions and issue airworthiness approvals thiness of parts and aircraft after review- An average of two planes a week receive for parts and aircraft. Issuing FAA Cer- ing all final documents that specify how an her signed certificate above the main en- tificates of Airworthiness is a process re- airplane was designed, planned, built and trance door, signifying to the flying pub- ferred to as “ticketing.” After ticketing inspected. lic that the plane is in condition for safe the airplane, Landino files her paperwork “Everything begins and ends with the operation. with the FAA while Field Operations per- customer,” said Paul Wolf, senior manager After beginning work in Boeing’s re- sonnel move the airplane into position for FAA Designee Administration who’s ceiving warehouse, Landino went on to for its new owners, Boeing’s customers. responsible for Landino and more than 200

18 October 2007 BOEING FRONTIERS n COMMERCIAL AIRPLANES

sign, in compliance with the Quality Man- Those initial tests assure that the design agement System. The Production Certifi- and processes used to build each plane are cate number the FAA assigned to Boeing sound and satisfy the compliance require- is PC700; this number also can be found ments for aircraft-certification eligibility. on the aircraft data plate, signifying which This also establishes the process founda- FAA approval covers its manufacture. tion for aircraft to be built in exactly the In every case, an original Certificate of same way—which enables the ability to Airworthiness is required before an aircraft obtain a Production Certificate. is delivered to a customer and the custom- “My colleagues and I perform final er operates it in commercial service. The inspections for the FAA, but production process at Boeing is extensive, involving workers on the line have to make sure that thousands of employees and suppliers who they build quality and safety into each add their expertise to the product. In fact, it plane every day,” Landino said. could be said that all BCA employees are responsible for airplane quality and safety. Walking the plane The 787 Dreamliner is currently going A critical part of Landino’s responsibil- through both Type and Production Certi- ities is the “ticket walk” to certify new air- fication efforts, leading to airworthiness planes just off the production line. certification and delivery. Her first step is to review all the pa- Wolf noted that type-design certifica- perwork from design and production, in- tion is the cornerstone of the process. cluding flight manuals, engine manuals, “Compliance and conformity go hand- lab test results—and even “squawks” in-hand,” he said. “Everything about the (flight discrepancies documented by a plane’s design, along with production’s flight crew) and reports from test pilots conformance to that design, means the after they fly the plane. “Everything is plane will be in condition for safe opera- kept in a log where any one of the des- tion. Every FAA Designee has to have ignees can refer to it,” Landino said. Her complete trust in the production and qual- signature is in the log book of each plane ity management systems that go into each she inspects. plane in order to issue an Airworthiness Once she deems all the paperwork Certificate. All FAA Designees essentially satisfactory, Landino moves to the next perform the duties on behalf of the FAA step. Donning her canary yellow safety within The Boeing Company.” vest, Landino walks out to the flight line at Boeing Field in Seattle, where the new Inspections are integral planes are sitting on the tarmac. She lit- Part of a designee’s job involves inspect- erally walks around the plane, inspecting ing airplane components. “The inspection everything from wheel wells to emergen- process is one element of a continuous ef- cy lights. Inside she checks the emergen- fort by Boeing, the FAA, and its designees cy equipment and safety features, such as to ensure quality and safety,” Wolf said. emergency floor lighting. “The FAA and its designees are a vital part If everything looks good, she’ll sign the of the checks-and-balances system that en- Airworthiness Certificate and slide it into sures a safe air transport system.” a plastic holder over the front cabin door Landino is familiar with parts inspec- (in a Boeing 737). The inspection process tion. She spent four years as an inspector takes anywhere from 30 minutes to two in the Materials Review Segregation Area hours—pretty short compared to the years and five years as an inspector on the 727 required for a new type design and months other FAA Designees globally. “The cash and 737 production lines. to build millions of parts, test and assem- register doesn’t ring until an aircraft is is- Long before a part or system enters pro- ble them into a Boeing airplane. sued an original FAA Certificate of Air- duction, it undergoes a series of lab tests All along, FAA personnel and desig- worthiness, either by the FAA or one of our and FAA conformity inspections. Once nees are reviewing documentation and designees acting on behalf of the FAA.” prototype structures have been built, all inspecting production lines, making sure major components complete rigorous every part conforms to the certificated Certificate required stress and endurance tests that go way be- design. When Boeing has demonstrated to the yond conditions that would be encountered And it all circles back to the customer. FAA that a new aircraft design meets the during the service life of the airplane. For “Compliance to the processes that standards for airworthiness certification, a new-model aircraft, such as the 787, this Boeing has documented to safely design the FAA issues a type design approval, also involves many months in Flight Test and build aircraft and parts is what en- known as a Type Certificate. A Production where all systems are tested and the air- ables us to obtain Certificates of Airwor- Certificate (PC) is issued to Boeing after it plane is operated to the extremes in order thiness—and deliver what we committed has proved to the FAA that it can reproduce to demonstrate that it complies with the re- to our customers,” Wolf said. n an aircraft in conformance with its type de- quirements. [email protected]

BOEING FRONTIERS October 2007 19 n COMMERCIAL AIRPLANES A balancing act Wantz p h oto Willia m Wantz Engineers from the Boeing Design Center in Moscow and the Huntsville (Ala.) Design Center occasionally travel to Everett, Wash., to work with their partners in the Interiors Responsibility Center. Here the IRC’s Design Engineer Aaron Pederson (left) works with Stress Engineering Analyst Srina Patel from Philadelphia, Senior Design Engineer Wayne Wise from Huntsville, and Senior Design Engineer Dmitry Saveliev from the BDC.

Interiors Responsibility requirements. This can be challenging to an Boeing and Lean+ successes. engineering work force, whose work pack- “The Boeing Production System calls for Center manages custom ages often begin years before a product or aligning seamlessly, and it doesn’t matter part enters the production system. where you design or build something. We needs, standard work How does an engineering organization simply must meet the needs of the custom- balance standard work with emerging cus- er,” said Beth Anderson, Interiors Respon- By Debby Arkell tomer needs? People at the Interiors Respon- sibility Center director. “To that end we’re sibility Center in Everett, Wash., do this by taking full advantage of our global resourc- id you know that Boeing Commer- cultivating strong working-together relation- es, using engineers around the world to bal- cial Airplanes is adept at balancing ships with other engineering organizations ance peaks and valleys in our workload.” Dfluctuating work statements along such as the Boeing Design Center in Moscow The IRC is responsible for designing, with the basic-and-stable elements of the and the Huntsville (Ala.) Design Center. With manufacturing, assembling and integrat- Boeing Production System? the ability to design and build anywhere, the ing a variety of interior systems for BCA. While the Boeing Production System IRC and design centers work together to bal- These systems include crew rests, ceilings, values standard work, standardizing isn’t ance a complex workload, generating both stow bins and much more. The IRC also possible when it comes to elements related to superior results and a stable work force— features a full range of composite fabrica- airline customers’ branding or other unique providing a testament to the global nature of tion capabilities, and engineering integra-

20 October 2007 BOEING FRONTIERS n COMMERCIAL AIRPLANES

frees up IRC engineers to support unique, It’s our future highly variable customer introduction re- Huntsville Design Center— Actions cited in this story show how quirements such as those for the 787 pro- a closer look employees are applying concepts of the gram or special customer needs. “The work we provide complements the The Huntsville Design Center in Huntsville, Boeing Management Model to support the Ala., has built a reputation as a design cen- company’s business strategies. Here’s how. IRC’s existing capabilities,” said Huntsville Design Center Director Rick Bottomley. ter of excellence. It currently employs ap- • Growth and productivity: Lean+, The lifecycle for mechanical design is proximately 150 engineers, with two-thirds through common systems and cross- about 18 months for airframe and primary of them dedicated to the 787 program. enterprise integration. designs. After that, the need for engineer- The teams are divided into engineering To learn more about the Management Model, ing decreases as development programs disciplines such as systems, structural/me- visit http://bmm.web.boeing.com on the become sustaining. Indeed, with five to chanical, thermal and electrical integration. Boeing intranet. 10 years between large development proj- Rick Bottomley, Huntsville Design Center ects, balancing the ebb and flow of work director, said his engineering team has its and work force levels is critical to the IRC roots in the International Space Station tion services supporting interior concept and the design centers. program. They have experience with the and product design through project man- “Over the course of the last year, because latest materials, developing their skills and agement and certification. we’re moving to common tool sets, we’ve bringing their lessons learned not only from The IRC formed 15 years ago when it been able to move work to people—instead of the space station but prior developmental combined related engineering, manufac- moving people to work—as locations around turing and other disciplines into one build- program activities in satellites, and com- the enterprise experience work fluctuations,” mercial and military aircraft. ing. This led to the establishment of a value said Mike Denton, Commercial Airplanes stream, where IRC workers are responsible vice president of Engineering. “This helps HDC engineers are available to programs for creating products, from customer defi- areas in an up cycle avoid local hiring while throughout the enterprise—from space to nition through production and delivery. helping mitigate temporary down cycles commercial and defense—and they can “This makes the concept of working in other areas where they might otherwise provide design support across multiple with engineers that are not in our immedi- have to lay off employees. It is, in my opin- programs and to locations around the ate area more challenging for us, because ion, a really good strategy.” world using a variety of virtual tools. They we’d built all our processes around colloca- That’s why, for example, the Huntsville currently support the U.S. Navy’s P-8A tion,” Anderson said. “However, it’s in line Design Center supports multiple areas Poseidon, an antisubmarine aircraft based with our vision to partner with the best and simultaneously—including work for oth- on a 737-800 platform; the 767 tanker brightest talent around the world.” er BCA programs as well as Integrated program; the 747-8; and a wide variety of Anderson said IRC and design center Defense Systems programs including the components on the 787. leaders have agreed on types of work that P-8A Poseidon. For more about Huntsville, see Page 38. will be performed by design centers outside Though downturns are inevitable in the IRC—generally work that is stable and BCA’s cyclical business, by keeping a —Debby Arkell steady. This allows design center partners steady flow of stable work with design cen- to count on a constant flow of work. It also ters, Anderson said, “we’ve committed to our design centers that ‘we’ll grow with you and shrink with you,’ which truly gets at the heart of our partnership.” LONG DISTANCES, COMMON TOOLS Long-distance partnerships such as these take extra effort to ensure they’re successful. Bottomley noted that using common tools has helped. One key element in HDC’s work with the IRC is that both use the design tool CATIA V5, so—in design terms—both sites essentially “speak the same language.” He also credits the Everett IRC for its willingness to work, share and foster a strong team environment, making HDC employees feel like true partners. “People in Everett have the benefit of bringing heritage methodologies to the ta- ble,” Bottomley said. “In working with us E ric Sh in d el b o w er p h oto In Huntsville, Ala., Interiors Responsibility Center leader Beth Anderson (second from in Huntsville or with our Moscow counter- right) meets with Huntsville Design Center leader Rick Bottomley (right), and two en- parts, the IRC brings in people who may gineers from his team—Forrest Yocum (left), senior stress engineer, and Wayne Wise, have other ideas or prior experience, and senior design engineer—to get status on IRC projects in Huntsville. Here Wise shows that enriches the end result.” n Anderson engineering development hardware for a 787 interiors support structure. [email protected]

BOEING FRONTIERS October 2007 21 n SHARED SERVICES GROUP Smile at the camera New gear streamlines processes, saves costs

By Liz Lane

ntegrated Defense Systems employees are making good use of Creative IServices’ new camera—the fastest digital panoramic camera in the world. Featured on the popular U.S. television shows “Bones” and “Crossing Jordan,” it’s already streamlining operations and shav- ing program costs.

“When I demonstrate the camera to P eter Geor g e p h oto various groups in IDS, employees immedi- Photographer Ron Bookout documents the C-17 flight deck manufacturing process. By ately see critical applications for their own clicking on the interactive image, which can hold 99 layers of content, production workers programs,” said Ron Bookout, Shared Ser- can quickly retrieve part numbers, look behind parts in the picture, view the actual vices Group photographer. “The technolo- production process, and virtually tour a platform or building. gy, which is remarkable, can be effectively used at Boeing Commercial Airplanes programs and elsewhere across Boeing.” John Costello, said he is very impressed. gency response. It provides detailed product The Boeing facility in Wichita, Kan., “This camera is phenomenal. Engi- views of cockpits and flight decks and has took an existing camera system made by neers in my group use it for everything,” marketing/training applications as well. Panoscan Inc. and applied commercially noted Costello. “We can’t do our jobs with- “This piece of equipment has exceed- available software to meet its customers’ out it.” ed my expectations,” Bookout said. “It’s needs. The capability now is being imple- Employees are taking advantage of versatile and offers a whole new level mented across the enterprise. these capabilities to drive Lean+ processes. of efficiency in documenting complex Bookout said he appreciates the equip- Now engineers can view entire platforms, projects.” ment’s advanced imaging capabilities, from the convenience of their desktops, for Not only does it streamline operations, which make it well suited for Boeing’s pho- easy reference throughout the design pro- but it also shortens the time spent on photo tography needs. For instance, this rotating cess. This reduces or eliminates the need shoots by eliminating the need for many camera can take a 360-degree picture in a for engineers to travel to platform sites. close-ups—and expensive reshoots. Also, single pass for comprehensive coverage. Other employees are using the camera because the camera fully captures scenes After photo shoots, photographers quick- to document incoming platform conditions with a few photos, it minimizes digital ly can view high-resolution images (9,000 before performing any modification or re- storage space and simplifies retrieval. pixels x 65,000 pixels) as standard flat pan- pair work. This has eliminated disagree- Creative Services employees support oramas or virtual reality movies and make ments with customers about damage and Boeing Frontiers by providing services on-site adjustments as needed. Addition- contents, and has saved Boeing money on such as photography and design work. ally, the system is the first of its kind to restitution payments. Most important, it For more information, employees should offer accurate panoramic image measure- has improved customer satisfaction by im- contact Bookout (314-705-2811, ronald. ment (within fractions of an inch), which mediately resolving disputes. [email protected]) or Ted Whiteside enables users to measure within the image Programs also are using the camera to (316-393-9833, ted.a.whiteside@boeing. itself as though on site, for facility modifi- document their manufacturing processes. It com). For a demo CD, contact Crystal cations/engineering. can be used to document building contents Rhodes (314-232-3692, crystal.a.rhodes@ One of the first employees to benefit for insurance reasons and blueprints for fa- boeing.com). n from it, IDS advanced technology analyst cility maintenance/modification and emer- [email protected]

22 October 2007 BOEING FRONTIERS n INTEGRATED DEFENSE SYSTEMS No magic formula are a total of 12 Stage-4 teams,” said Tim teams wanted to do the same,” he said. Manager shares keys Coyle, Support Systems’ vice president Baker’s teams have created an impres- for Operations and Quality. “He is a true sive portfolio of economical and efficient on how to implement example of what I call a ‘servant leader’ ways of doing business. For example, to re- —a leader who serves others while stay- duce flow days, several teams worked to- Employee Involvement ing focused on achieving results.” gether to convince the Air Force to allow Baker joined Boeing in 2000 following the KC-10 aircraft to be stripped of paint— By Deborah VanNierop his retirement from the U.S. Air Force. He something that’s never been done before. cut his teeth at the Support Systems San “By stripping all the previous layers of hen asked how a leader can moti- Antonio site as a first-level manager in the paint off the aircraft, we can give our cus- vate a team, Carl Baker thought KC-135 Programmed Depot Maintenance tomer a lighter plane which uses less fuel,” Wfor a moment and said: “If you’re program and was soon promoted to the po- Baker said. “I have tremendous individu- driving in a car with a group of people and sition of back shop senior manager. als on all of my teams who never stop chal- you get a flat tire, would you just sit there In his current role, he oversees the lenging themselves (and others) to find a and wait for someone else to fix the prob- site’s core competency operations includ- better, more efficient way to meet the cus- lem? Or would you get out, roll up your ing emergent manufacturing, paint and de- tomer’s needs.” sleeves and help?” paint, air refueling, production control and It hasn’t always been such a smooth To Baker, Employee Involvement is government property. These functions sup- journey. Baker remembers when EI was that simple. “There isn’t a magic spell or port the site’s C-130 Avionics Moderniza- introduced to Boeing employees and some secret potion when it comes to successful- tion Program, C-17 Globemaster Sustain- brushed it off as another passing fad. How- ly implementing EI into an organization,” ment Partnership, KC-135 Programmed ever, the EI concepts left an impression he said. “EI is a journey, and you’ve got to Depot Maintenance, KC-135 Global Air with Baker: “Who else knows how to run take the journey with your people. Be there Traffic Management and KC-10 Contrac- the business better than the employees who to fix the flats, remove the obstacles, and tor Logistics Support aircraft. do the work?” Still, he said, it was a chal- keep everyone moving.” While Baker acknowledged he does all lenge convincing everyone that EI would Baker, San Antonio operations senior he can to support his teams, he said it’s the make a difference. manager for Integrated Defense Systems’ members of the teams who make EI work. These days, Baker doesn’t spend much Support Systems business, is a man of few “All of my teams have really taken the time convincing anyone that EI works. words. But when he speaks, people listen. EI concepts and run with them. As soon as They’re seeing the results themselves. n “Carl is very candid, but he always en- the first team progressed to Stage 4, other [email protected] courages two-way communication. He is straightforward with his teams, and they really appreciate that approach,” said Gene Gentry, paint shop senior manager. Baker has seen the difference EI makes to the teams he manages. He oversees 10 EI teams, five of which are at the highest EI level: Stage 4. “This is a fantastic accomplishment, given that sitewide there

It’s our future Actions cited in this story show how employees are applying concepts of the Boeing Management Model to support the company’s business strategies. Here’s how. • Leadership: Employees model the Boeing leadership attributes. • Growth and productivity: Lean+, through engaged and involved employees.

To learn more about the Management Model, JON G OETTIN S P H OTO visit http://bmm.web.boeing.com on the Carl Baker, Boeing Support Systems San Antonio operations senior manager, stands with members of his Employee Involvement teams. Baker oversees 10 EI teams, five of which Boeing intranet. are Stage 4 teams, the highest level an EI team can achieve.

BOEING FRONTIERS October 2007 23 n INTEGRATED DEFENSE SYSTEMS A matter of global importance

Commander Air Lift Group Air Commodore Glen Steed of the Royal Australian Air Force answers reporters’ questions at RAAF Base Amberley last December, following the arrival of the first of four C-17 Globemaster IIIs for the service.

ROYAL AUSTRALIAN AIR FORCE PHOTO IDS sees international the international market represents a signifi- “South Korea’s order in 2002 for cant and growing portfolio of defense busi- 40 F-15K fighters was really the pivotal markets as a major ness worth potentially more than $30 billion point in terms of a pickup in internation- over the next five years. al business,” said Mark Kronenberg, IDS area of business growth Today the largest single customer vice president of International Business base for IDS remains the U.S. govern- Development. By Paul Lewis ment. However, with most forecasts en- Kronenberg said that today the Asia- visioning a flattening U.S. Department of Pacific region is IDS’ largest internation- ne can measure the importance of Defense budget, IDS is focusing increas- al market, accounting for more than 50 the international market to Boeing ing attention overseas to help sustain fu- percent of total international business, OIntegrated Defense Systems’ overall ture growth. Boeing’s volume of interna- with the Middle East market share rapidly business in many ways. Some 38 different tional defense business has been steadily growing in the near future. countries are currently customers. There are expanding in recent years. This segment 2,000 suppliers engaged worldwide. And generated 13 percent of IDS’ overall rev- Success in platforms more than 3,000 people visited the Boeing enue in 2006—a percentage nearly double The platform-dominated portfolio of chalet at the 2007 Paris Air Show. Added up, that of five years ago. IDS’ Precision Engagement and Mobility

24 October 2007 BOEING FRONTIERS n INTEGRATED DEFENSE SYSTEMS

Systems business has enjoyed the great- tional derivative of the P-8 maritime patrol est success. Recent examples include C-17 aircraft. (For more on Boeing’s enterprise- A worldwide chain sales to Australia, Canada and the United wide involvement in India, see Page 12 of Kingdom; last year’s 737 Airborne Early the June 2007 Boeing Frontiers.) To establish a stronger presence in nations Warning & Control (AEW&C) deal with For other programs where domestic around the globe, Boeing has developed South Korea; the breakthrough export sale order backlogs have been fulfilled, inter- partnerships with leading aerospace and of F/A-18F Super Hornets to Australia; and national sales have taken much greater technology companies. Here’s a partial list. an order for additional Chinooks from the significance. Successive sales of F-15s to Country Partner companies Netherlands (see Page 28 for more on the South Korea and Singapore have not only Netherlands). sustained the production line in St. Louis, Australia BAE Systems Australia “The potential is for even greater suc- but supported continued advances in sys- Israel Elbit cess over the coming years as new markets tems and capability. India Hindustan Aeronautics emerge and major new international com- “As we invest in future fighter tech- petitions get under way,” said Tom Bell, nology, it is essential we extend our pro- Larsen & Turbo PEMS vice president for Business Devel- duction lines. Capturing new internation- TATA opment. al business is a vital ingredient to doing Japan Fuji Heavy Industries Among the most notable opportuni- that,” said Chris Chadwick, vice president/ Kawasaki Heavy Industries ties is India, a country that until recently general manager of the Global Strike Mitsubishi Heavy Industries was off-limits to U.S. defense companies. Systems division of PEMS. The political rapprochement between New Indeed, in some cases, international Saudi Arabia Alsalam Aircraft Co. Delhi and Washington has cleared the customers have served as the impetus South Korea Huneed Technologies way for the F/A-18E/F to compete for the for launching major new developmental Korean Aerospace Industries Indian Air Force’s Multi-Role Combat efforts. Korean Air Aircraft competition for 126 new fighters, The KC-767 tanker started life with worth a reported $10 billion. Other Boeing an initial order from Italy followed by United Kingdom QinetiQ products of interest to India’s military in- an order from Japan. The 737 AEW&C is Thales clude Boeing’s rotorcraft and an interna- another program launched and sustained Note: Excludes Boeing wholly owned subsidiaries in other nations evin Flynn P H OTO K evin Flynn

Two F-15K aircraft are en route to South Korea. In 2002, the Re- public of Korea Air Force ordered 40 F-15Ks.

BOEING FRONTIERS October 2007 25 n INTEGRATED DEFENSE SYSTEMS

The international market is worth a potential $30 billion over the next five years. Mark Kronenberg (left), IDS vice president of International Business Development, discusses the market with Mitch Kugler, director, Strategic Integration, IDS Business Development. T H O M AS G OERTEL P H OTO

entirely by international support, initial- & Reconnaissance; Homeland Security; To whom does Boeing sell ly from Australia and Turkey and more and Missile Defense,” Kronenberg said. defense products ? recently South Korea (see Page 58 of the Building a presence August 2007 Boeing Frontiers). Did you know that in many cases when To help secure international business, international governments procure Boeing In the weapons arena, the United King- IDS is moving beyond simply selling dom has been the main driver behind the defense products, they don’t actually buy products to countries—and toward build- the items directly from Boeing? Brimstone air-to-surface missile, while the ing a deeper and broader presence in local Block II development of the Harpoon has markets. Instead, the U.S. government—through been wholly supported by international A closely connected strategy for achiev- the Defense Security Cooperation Agency users. ing this goal in key markets, such as the of the Department of Defense—buys The international market is starting to Middle East, is to leverage the different them. The products then are sold to the affect other areas of IDS such as Network activities across Boeing—civil and mili- international governments at a price that & Space Systems and Support Systems. tary—to strengthen local relationships. A recoups the actual costs incurred by the International satellite sales and launch recent example of this is Boeing’s signing United States. contracts are a relatively small but grow- of a series of cooperative agreements with For more information about this process, ing part of N&SS business. Recent notable the Saudi Arabian General Investment Au- successes include the Boeing-built Thura- visit the DSCA Web site at www.dsca. thority and the UAE’s Dubai Aerospace osd.mil. ya communications systems for the Unit- Enterprise and Mubadala Development. ed Arab Emirates (UAE) and the Boeing “Having a cross-enterprise strategy has Launch Services launch of the first Italian brought us closer to Boeing Corporate and COSMO SkyMed Earth-observation space- Commercial Airplanes to find innovative craft, with launches contracted for the sec- solutions for our customers’ needs,” said ond and third COSMO spacecraft. Jeff Johnson, IDS vice president, Busi- “Potential areas for future growth in the ness Development Middle East and Afri- international marketplace include Combat ca. “The Gulf states want to develop their Systems; Command, Control, Communica- own aerospace industries and are looking tions, Computers, Intelligence, Surveillance to Boeing to help guide their development

26 October 2007 BOEING FRONTIERS n INTEGRATED DEFENSE SYSTEMS

over the next 20 years. They want to leverage our learning curve to be more effective sooner. This in turn helps us get closer to the customer and gain broader market access.” To further establish a presence in other nations, Boeing has developed a chain of industry partnerships that now extends around the world (see box on Page 25). These partners work in many areas, such as license manufacturing, engaging local suppliers, establishing support facilities, and providing pilot training or teaming to compete for new work. IDS, under its Support Systems business, has a growing number of overseas employees as the result of international investments and acquisitions. The largest examples include Brisbane-based Boeing Australia Limited, with some 2,500 employees and a broad range of business activities encompassing aerospace support, network-enabled systems and services. In Saudi Arabia, Alsalam Aircraft Company and its 2,800 people provide civil and military aircraft maintenance and upgrades. “We want to take this business model of establishing a local subsidiary or joint venture and replicate it in other countries,” said Torbjorn Sjogren, vice president, In- ternational Support Systems. “Our overarching strategy is to bring Boeing products and service closer to the customer, help reduce response times and meet customer requirements to develop localized capabilities.” n [email protected] B O F ER G USON P H OTO An HC Mk2 Chinook conducts maneuvers outside of Odiham, United Kingdom. Nations around the world have shown interest in Boeing Rotorcraft products such as the Chinook.

BOEING FRONTIERS October 2007 27 n FEATURE STORY Biggerthan its size

28 October 2007 BOEING FRONTIERS n FEATURE STORY

By Maribeth Bruno

he “golden age” of the low-lying part of Europe now known as the Netherlands arrived in the 17th century. While fight- Ting wars and signing treaties with their bigger neighbors, the Dutch used their logistical genius to build a trading empire that stretched from Asia to the Americas. Meanwhile, engineers inno- The Netherlands may be vated increasingly ambitious methods to save fields from flooding and to claim dry land from the sea. geographically minuskuul, In the 21st century, the Netherlands’ internationalism, inno- but this innovative, vation and position at the forefront of environmental issues have proved to be as resilient as the Dutch themselves. These traits now than its strengthen the relationships between Boeing’s commercial, de- environmentally conscious fense and research divisions and the company’s Dutch customers country has gigantisch and supplier partners—with tangible benefits for all. importance to Boeing Royal heritage The earliest sale to the Netherlands in the company’s history size was probably the DC-2. In October 1934—15 years after starting operations—KLM Royal Dutch Airlines entered one of its DC-2s in a race from London to Melbourne, Australia. The DC-2’s second-place finish behind a racing airplane—while making all its scheduled stops—increased its popularity around the world. KLM remains a valuable customer and partner for Boeing today. It operates MD-11s; Classic and Next-Generation 737s; and 747s in all-passenger, Combi and Freighter configurations, and has The Netherlands’ iconic windmills and tulips are just two examples of how the country phased out its 767s with the addition of 777-200ERs. In 2004, KLM has managed its environment for centuries. merged with Air France to form AIR FRANCE-KLM Group. The While flood control remains a major concern, group in June made its first joint announcement for new airplane the population is also calling for reductions orders—nine 777-300ERs and seven 737-700s. in carbon-dioxide emissions and noise. “KLM is a long-term customer that, while it naturally has an affinity with European companies, also has strong ties to U.S. industry,” said Tom VanderHoeven, Boeing Commercial Airplanes director, European Sales. KLM runs a subsidiary airline called KLM Cityhopper and the Dutch unit of low-cost, all-737 operator transavia.com. It also owns 50 percent of the shares of European carrier Martinair. The airline’s home base is Amsterdam Airport Schiphol, where in the first half of 2007, 42 percent of the 22.4 million passengers served were between flights. “Transit traffic has lower yields [airfare divided by revenue passenger miles], so to succeed you need to keep costs down and offer more connections at higher frequencies,” said Jan Witsenboer, KLM senior vice president of Corporate Procurement and Fleet Development. Expanding and updating its fleet with airplanes that are fuel- efficient and can fly long distances is part of KLM’s response to this challenge. For instance, it has increased its service to Los Angeles and Toronto and launched nonstop service to Lima, Peru, with its new 777s. “Boeing builds good aircraft that match our requirements,” said Witsenboer. These requirements increasingly involve environmental concerns—chiefly fuel consumption, carbon dioxide emissions and noise. By spring 2008, all of KLM’s Next-Generation 737s will have Blended Winglets, which enhance performance and reduce carbon dioxide emissions. The airline also partners with Boeing, Schiphol and air traffic control authority LVNL on ways to reduce environmental impact through advanced air traffic management (see story on Page 33). One of Boeing’s environmentally progressive solutions is the 787 Dreamliner. Asked if he was considering the 787, Witsenboer

ISTOCKP H OTO . CO M I A G E replied, “Yes—who’s not?” He noted that KLM regularly flies

BOEING FRONTIERS October 2007 29 n FEATURE STORY

747 Combi aircraft—280 seats, with seven pallets in the rear—to military personnel—restricts deployments to a modest number, it reduce unit costs. Using a 230-seat 787-8 on the same route, he is “lean and mean,” said van Dijk. “A few years ago, they reorga- said, it becomes “the front of a Combi,” flying the same distance nized and reduced their numbers in order to be able to invest in but with better seat-mile costs and the ability to economically open high-quality, flexible, and fully deployable forces and equipment. new routes in Asia. And Boeing was and still is part of that.” “The Netherlands is one of the most densely populated areas in Boeing products procured by the Netherlands Ministry of the world, with an expanding need for air transport and for signs of Defence include 29 AH-64D Apache attack and reconnaissance environmental innovation and improvement,” said VanderHoeven. helicopters (for which it was the first non-U.S. customer); 11 “If we can work together to find solutions, those products could CH-47D Chinook transport helicopters; two KDC-10 tanker/trans- then be accepted in other areas of the world that will soon be in the port aircraft; one DC-10 passenger/freight aircraft; the RGM-84D same situation.” Harpoon missile; the Joint Helmet Mounted Cueing System for F-16 pilots; and Joint Direct Attack Munition Precision Guidance Advanced ally Kits. The country is also part of a group of nations supporting the Dutch foreign policy focuses on the European Union, the Unit- NATO Airborne Warning and Control System program. ed Nations and NATO. Therefore, the Netherlands “recognizes its In February, the ministry’s Defence Materiel Organization and responsibility for peacekeeping missions, and is willing to take Boeing signed a direct commercial sales agreement for six new- the lead in coalition with other countries,” said Robert van Dijk, build CH-47F (NL) Chinooks to be delivered in 2009-2010—the Boeing Integrated Defense Systems director of Business Develop- first sale of that model outside the United States. ment, Benelux (Belgium, Netherlands, Luxembourg). “The Dutch use their Chinooks not just to fly from A to B, but While the size of the Dutch force—a little more than 50,000 also for special forces deployment,” said van Dijk. “So they operate a special configuration that’s more extensively equipped and weather-independent.” Boeing products in use by the Dutch The Netherlands has some 2,000 troops deployed overseas, of armed forces which 1,600 are stationed in Afghanistan as part of the NATO-led include the AH-64D International Security Assistance Force. Apache attack and “We have a very modern glass cockpit that some countries reconnaissance are jealous of,” said Lt. Col. Bart Hoitink, commander of Royal helicopter (top) and Netherlands Air Force Squadron 298, which has three D-series CH-47D Chinook transport helicopter. Chinooks in Afghanistan, supported by 30 troops. “With it, we The Netherlands can foresee parts of the flight … and the Chinook will tell us if we earlier this year can do the mission. We also have capabilities that came from the became the first Apache for protection against missiles and radar. non-U.S. customer “All that will be brought forward into the CH-47Fs,” Hoitink for the new CH-47F continued, “plus we’re focused on adding growth potential, expan- with an order for six of the aircraft. sion capabilities.” “Defence is a proactive customer, and they pick what they need,” said van Dijk. “In negotiations such as the NATO plan to purchase C-17A airlifters, they can have a lot of influence with other countries.” Partnering with KLM Partnerships are a large and successful element of the Boeing- KLM relationship. Their joint Spares Distribution Center near Schiphol can meet requests for 35,000 types of parts in stock, usu- ally in less than 24 hours. The same facility houses the Next-Generation 737 Component Services Program, which the two companies announced in April 2005. Boeing and Air France formed a CSP for the 777 in Paris in late 2003. Airlines in either of the programs gain access to a pool of high-value parts, reducing their inventory and repair costs by up to 30 percent. Boeing manages the repair of Boeing-proprietary parts, and KLM and Air France handle the rest. “One of our early Lean initiatives was to bring all our inventory and people together,” said Paul Morgen, Boeing Commercial Aviation Services director of Component Services. “Each of us has an equal value of inventory shared into the program, and both Boeing and KLM people work at the same facility to improve communication and share best practices.” The 737 and 777 CSPs remain mostly separate despite the Air France–KLM merger, but “one synergy is that when we plan a sales campaign, CAS Sales gets together with both KLM and O F D E ENCE P H OTO NET H ERLAN D S M INISTRY

30 October 2007 BOEING FRONTIERS n FEATURE STORY

KLM operates several Boeing jetliner models, including the 777 (below, at Amsterdam Airport Schiphol). The airline was the launch customer for the Boeing 747-200 and the Electronic Flight Bag, and the European launch customer for the 737-900. P H OTOS F OR KL M CAPITAL

Air France Sales and we develop an approach together,” said Morgen. “Whoever we all decide has the best relationship with the The Netherlands at a glance customer takes the lead.” Location: Western Europe, bordering the North Sea, between Building business relationships Belgium and Germany Boeing’s defense contracts also provide work for Dutch indus- Area: 16,033 square miles (41,525 square kilometers), about try, due to military offset requirements that say 100 percent of a double the size of the U.S. state of New Jersey contract’s value must be reflected in in-country projects. More than 80 Dutch organizations are at work on both military and com- Estimated population: 16.6 million mercial projects to satisfy the requirement in a way that benefits Capital: Amsterdam (seat of government is The Hague) everyone. Other major cities: Rotterdam, Utrecht “The Dutch Ministry of Economic Affairs’ goal is to grow technology, working with small and medium enterprise, and grow their Total gross domestic product, 2006: $612.7 billion aerospace industries,” said Ligia McLean, IDS Industrial Partici- Estimated GDP growth rate, 2006: 2.9 percent pation manager for the Netherlands and Belgium. “The Dutch are very skilled in advanced composites, machining of hard metals, Main export partners: Germany, Belgium, United Kingdom, France, precision machining, and advanced electronics. Plus, they are able Italy, United States to remain cost-competitive despite the [monetary] exchange rate.” Main import partners: Germany, Belgium, China, United States, Success stories include Dutch Aero’s one-piece instrument pan- United Kingdom, Russia, France el for the Apache, Tedopres’ conversion of helicopter Integrated Military expenditures as percent of GDP, 2005: 1.6 percent Electronic Technical Manuals into an automated Japanese format, and Dutch Thermoplastic Composites and Kok & Van Engelen’s Languages: Dutch; Frisian. About 85 percent of the population can manufacture of reinforced thermolaminate composites for both speak English. IDS and Commercial Airplanes. Small business To70 Air Traffic Sources: CIA World Factbook; Netherlands Foreign Investment Agency Management worked with Boeing subsidiary Jeppesen to provide studies of integrated simulation, decision support and scheduling solutions for airports.

BOEING FRONTIERS October 2007 31 n FEATURE STORY

Boeing also created an opportunity with the Institute of Knowl- edge and Technology Center and machining company Genius Klinkenberg International, in which Boeing Quality and Lean+ experts provided training to a consortium of small businesses with John Bruins works on a C-17 GKI as focal. “Boeing is helping to create business relationships ramp attach torque box at Stork with economic benefits to the Netherlands that extend beyond the Aerospace in Papendrecht. The terms of the contract obligations,” said McLean. “In return, these company was named a 2004 Dutch entities have an interest in supporting the sale of our prod- Boeing Supplier of the Year for its work on the C-17 and Apache ucts and services.” programs. Preferred supplier: Stork Aerospace One such entity is Stork Aerospace, a close-knit group of companies that includes the heritage of aviation pioneer Anthony Fokker’s namesake factory. Stork develops and produces advanced components and systems and supplies maintenance services to the commercial, civil and military aerospace segments. “Our background in aircraft integration distinguishes us from other suppliers,” said Peter Flinkerbusch, sales director for structures provider Stork Fokker, an operating company of Stork Aerospace. “And the Dutch are traditionally known for their entrepreneurial spirit. We’re a good partner for Boeing as it expands globally.” Stork Aerospace’s relationship with Boeing began with an offset program for Apache avionics bays, which developed into a regu- lar contract. It also provides the C-17’s ramp attach torque box and troop door air deflector. The company was named a 2004 Boeing Supplier of the Year, Major Structures category, for its work on these programs. On the commercial side, Stork Fokker contributed to the wing redesign for the 747-8 and is providing the engineering and initial production for that airplane’s inboard flaps—including management of the supply chain. Building on its success with other Boeing programs, wiring unit Fokker Elmo in 2005 won several contracts for the electrical wiring packages for the 737 and 777—and also has a development contract with IDS to provide wiring for the P-8A Poseidon. Mar- keting & Sales Manager Mischa Baert noted that a large part of the P-8A work will be subcontracted to U.S. small businesses while managed by Fokker Elmo. “Stork is an intelligent supplier—it improves the product and the process by emphasizing innovation, a strong customer focus and cost management,” said Boeing’s van Dijk. The company invests about 11 percent of its profits in research and development, and is enhancing both its Lean processes and its global supply chain— including facilities in Lang Fang, China, and in Kent, Wash. “We outsource some of our work in other countries not only to improve on costs, but also to support our customers’ business case in those locations,” said Arjan Vergouw, Stork Aerospace director of Business Development. Many relationships, one Boeing SA M RENT EESTER /FM A X P H OTO Jan Narlinge, president, Boeing Northern Europe, calls the Netherlands an example of “achieving an optimum.” “They want to be part European and part transatlantic—and It’s our future they’ve been very successful,” he said. “Likewise, the Netherlands Actions cited in this story show how employees are applying con- is an example of Boeing’s success in building international rela- cepts of the Boeing Management Model to support the company’s tionships in all sectors. business strategies. Here’s how. “But we have to remember that customers don’t see us as IDS or Commercial Airplanes or International—they see us as The • Growth and productivity: Integration, global partnerships. Boeing Company,” Narlinge added. “If we work together as one To learn more about the Management Model, visit http://bmm.web. company, with an international outlook, we can only grow—in the boeing.com on the Boeing intranet. Netherlands, in Europe, and around the world.” n [email protected]

32 October 2007 BOEING FRONTIERS n FEATURE STORY P H OTO LVNL Controllers work in the air traffic control tower of Amsterdam Airport Schiphol. Boeing is partnering on Air Traffic Management -re search and development work with KLM Royal Dutch Airlines, Schiphol and LVNL (Air Traffic Control the Netherlands), among other Dutch partners. The team’s Tailored Arrivals concept recently completed in-service trials at the airport. ATM: a common language One of Boeing’s most exciting partnerships in the Netherlands is its Air Senior Technical Fellow Belur Shivashankara said Commercial Traffic Management research and development work with KLM Royal Airplanes will use knowledge gained in the Netherlands “in develop- Dutch Airlines, Amsterdam Airport Schiphol, LVNL (Air Traffic Control ing computer programs that will help define optimum low-noise, the Netherlands) and other partners. The team has been working on low-emissions takeoff and landing procedures. We are also discussing concepts designed to save fuel and reduce emissions and noise while features for the [aircraft] flight management computer to aid the use of allowing aviation to grow. environmentally progressive operational procedures.” “The Netherlands has stringent environmental requirements, complex Shivashankara called his Dutch counterparts “truly experts among the levels of air traffic, lots of neighbors, demand for growth,” said Rob air navigation service providers.” Mead, a lead Phantom Works engineer for Boeing ATM. “Partnering “Our cooperation with Boeing has added momentum to our develop- here gives us insight into some of the most demanding situations likely ment work,” said Evert Westerveld, manager of ATM R&D for LVNL. to be encountered in ATM.” “Our engineers and Boeing’s connected well. There’s respect for one The team’s first deployed concept was the collaborative decision- another’s expertise.” making tool that emerged from the joint Inbound Priority Sequencing The team also wants to play a part as larger U.S. and European ATM project. It involves letting airlines influence which flights receive priority initiatives begin to define common architectures and interoperability handling by ATM when demand exceeds capacity. It is now in use standards. “The United States is ahead in some aspects, while Europe by KLM, in cooperation with LVNL and the Eurocontrol Central Flow is in others,” said Eugenie Kalshoven-van Tijen, KLM ATM director of Management Unit. Strategy. “We’ll share what we’ve learned so we each don’t reinvent Another concept—the efficient, predictable, continuous descents the wheel.” known as Tailored Arrivals—has completed in-service trials at Schiphol “Really big endeavors get a lot of press, and rightfully so,” said Kevin and then in San Francisco and with NASA. The participation of Eurocon- Brown, Commercial Airplanes ATM vice president and general manager. trol Maastricht, which is responsible for traffic control in the upper “But there will continue to be a critical need for spiraled development, airspace of Belgium, Luxembourg, the Netherlands and northwest testing, and deployment of transformational concepts of operation and Germany, expanded the project’s European footprint, said Mead. “The technologies. That’s where forward-looking partners can work together results are now being fed back into the next round of development in to change how airplanes fly.” the Netherlands, through the Speed And Route Advisory project,” Mead added. —Maribeth Bruno

BOEING FRONTIERS October 2007 33 n FEATURE STORY Looking ahead

Participants in the 2007 Boeing Young Leaders Program visited the facilities of Korea Aerospace Industries to view F-15K production and Apache production lines. The program plays a role in deepening the involvement of Boeing in Korea. Behind the students is a T-50 b oein g p h oto Golden Eagle advanced supersonic jet trainer developed by KAI for the Republic of Korea Air Force.

“Sometimes it seemed more like an educational training pro- Boeing-Korea partnership, rooted gram—Boeing doing more to help us—than an internship, where we ought to be working for Boeing.” said graduate Eunbin Chung. in the past, reaches into future Meanwhile, Young-Ki Jin, a mechanical engineering student at Inha University, said the most exciting part of the program for him By Kathrine Beck was meeting with F-15K engineers in Saechon, Korea, where part ineteen young men and women converged at the of the Boeing fighter aircraft is built. “It was awesome to see how JW Marriott Hotel in Seoul, Korea, in August for a re- proud they were of working there as engineers. It is just what I union. The group caught up on friendships, shared news want to be in the next 10 years.” N By investing in Korea’s youth and helping Korea’s future busi- of careers and educational development and heard welcoming words from Greg Laxton and Maggie Kymn, vice president and ness and technical leaders learn about Boeing, this program plays communications director, respectively, of Boeing Korea. a part in demonstrating how Boeing is building a long-term pres- The guests were graduates of the Boeing Young Leaders pro- ence in Korea—which will host the Korea Aerospace & Defense gram, along with their family members and Boeing employees. The Exhibition 2007 air show this month. That presence manifests it- Boeing Young Leaders program is a unique internship program that self through Boeing’s support of Korean customers, its reliance on exemplifies how the Boeing relationship with Korea is poised to Korean suppliers—and its activities that support Korea’s people. grow. Every year, eight local college students are chosen as Boeing “We’re becoming very much a part of the Korean landscape,” Young Leaders. Kymn, who manages the program, said it’s the only said Boeing Korea President Bill Oberlin. “And we intend to con- formal Boeing internship program outside the United States. “We tinue to improve our ability to work in partnership with Korean only ask that they speak some English and have a passion for becom- airlines, the aerospace sector and the government—and through ing future leaders,” Kymn said. Interns help with office chores such them, with the people of Korea.” as translation, and the program teaches them leadership skills in ar- Strong roots eas such as time management and communication. Boeing’s partnership with Korea reaches into the future, but it

34 October 2007 BOEING FRONTIERS n FEATURE STORY

has strong roots in the past. Boeing and Korea have been working together in commercial aviation and in defense for more than 50 years. The first Boeing sale to the Republic of Korea was a DC-3, purchased by the government in 1950. Boeing Commercial Airplanes has been a partner of Korean Air since a 1970 sale of a Boeing 707. Korean Air is one of the world’s top 20 airlines and operates almost 400 passenger flights per day to 110 cities in 36 countries. The carrier, like the Korean economy, continues to grow vigorously. Boeing airplanes make up more than three-quarters of its fleet. “They have all of our newest and most modern airplanes, and more on order,” said Jim Simon, BCA sales director for Korean Air. Now in the pipeline are five 737-900ERs, four 777-300 ERs and 10 787s, with an option on 10 more. Korean Air also has become a powerhouse in air cargo. From 2004 through 2006, it’s been the world’s top international cargo operation, based on freight tonne-kilometers. Its goal: to attain the No. 1 systemwide position, moving ahead of FedEx and UPS. “They fully intend on keeping that position, and it shows in their purchasing,” Simon said. The airline has eight 747-400ER Freighters serving today and one on order. It’s also purchased 747-8 and 777 freighters. Besides being a major customer, Korean Air is also a valued supplier partner to Boeing. Korean Air Aerospace Division, a division of Korean Air, provides design, manufacturing, marketing, and maintenance products and services for aircraft, satellites and launch vehicles. It also makes parts for the Boeing 737, 747-400, 767 and 777 and is a joint development partner on the 787 Dream- liner program. In 2006, Korean Air had a 99.8 percent Boeing quality performance rating and a 98.04 percent delivery performance rating, earning it a Boeing Supplier of the Year award, an honor the company had previously won in 2000. Korea’s second-largest commercial airline, Asiana Airlines, also is a valued Boeing customer. Asiana was established in 1988 and operates more than 60 airplanes, including 737s, 747s, 767s and 777s, linking more than 60 cities in 17 countries. In June, Boeing delivered a 777-200ER airplane to Asiana in the airline’s new livery. It was the fifth 777-200ER of an order for seven, with the sixth airplane delivered in August, in addition to three leased 777s. In April, Asiana was awarded a “5-Star” rating by Skytrax for its customer service. This honor provides additional recognition to an already award-winning focus on the passenger and on in-flight din- ing, particularly on Asiana’s long-haul fleet of 747s and 777s. Asiana also has a solid focus on environmental issues, with plans in place to minimize noise, exhaust emissions and fuel consumption while applying green processes to everyday business operations. IDS involvement IDS partnerships with Korea also are strong and growing. The Republic of Korea Air Force (ROKAF) chose the F-15K Slam Eagle for its Next Generation Fighter Program in 2002. Under a $3.6 billion contract, Boeing agreed to deliver 40 F-15Ks to the ROKAF. Twenty-four have been delivered, with the balance scheduled for delivery by September 2008. Boeing is now negotiating with the ROKAF to provide 20 more F-15Ks. Steve Winkler, director of F-15 International Programs, noted that “a good bit” of the aircraft is built in Korea. Engines are An engineer with Korea Aerospace Industries works on a part for provided by Samsung Techwin, and wings and forward fuselages the F-15K program. KAI is Boeing’s largest Korea-based supplier come from Korea Aerospace Industries Ltd. KAI is also a BCA and works with Integrated Defense Systems and Commercial supplier providing 737 horizontal and vertical assemblies and has Airplanes. won significant subcontracts for commercial airplane work. In addition, KAI manufactures all Boeing AH-64 Apache helicopter fuselages in Korea. Additional F-15K components are provided by

BOEING FRONTIERS October 2007 35 n FEATURE STORY

other Korean partners, including Korean Air Aerospace Division, ity. KAI will modify the remaining aircraft in Saechon. LIG Nex1 LIG Nex1 Future, Hanwha, WIA and Samsung Thales. Future, another partner, will supply radios for the system and Supplier-partner relationships strengthen the Korean aerospace work with Boeing on other projects focused on network-enabled sector and also provide it with its own export opportunities. For capability. example, Korean suppliers also will be helping build F-15 aircraft Boeing also will get AEW&C support from Huneed, a Korean for Singapore, thus extending the market for Korean aerospace. company in which Boeing has an 18 percent equity interest. Huneed “We are extremely happy with the industrial partners we work will establish a technical publishing system and, in a program op- with on our programs,” said Boeing Korea’s Laxton, who’s respon- tion, integrate, test and deliver a ground-based, commercial-off-the- sible for all IDS programs within Korea. “We are really impressed shelf data link system. In addition, Boeing’s C3 Networks division is with their commitment to quality and their ability to meet sched- subcontracting work to Huneed, leveraging its capabilities in tactical ules and budgets.” communications (radios), Korean data links, Korean cryptographic Laxton added that the benefits of these partnerships extend be- equipment and cost-effective software development. yond Korea’s borders. “We’re strengthening our position and our “What makes this all work is the building of relationships be- growth throughout the world,” he said. “That creates more oppor- tween Boeing, DAPA (Korea’s Defense Acquisition Program tunity for Boeing, which will continue to grow the company and Administration) the ROKAF and our partner suppliers,” said create jobs in the U.S.” Randy Price, Boeing E-X program manager. “Our Korean customers are very quality-conscious, attentive to details and to process- AEW&C and rotorcraft es, and open to new ideas.” The F-15K isn’t the only Boeing defense aircraft Korea has se- The Korean government also operates Boeing rotorcraft and lected. In November 2006, Boeing announced the signing of a has been a Chinook customer since 1987. Today, said Tim Nichols, $1.59 billion contract to provide four 737 airborne early warning Rotorcraft Business Development Manager, Korea, Boeing stands and control (AEW&C) systems for the Republic of Korea’s EX ready to work with Korea to satisfy new rotorcraft requirements. program. The system includes a 737-700 platform topped with a Korea will need new equipment to support the country’s 2020 vi- multirole electronically scanned array radar unit that can track air- sion of a modernized fleet with fully integrated and networked borne and maritime targets simultaneously. The contract includes joint operational capability for border defense, peacekeeping mis- ground support segments for flight and mission crew training, missions and humanitarian aid—as well as an army and air force with sion support and aircraft and system modification support. increased operational flexibility for changing conditions. Delivery of the first 737 AEW&C aircraft is scheduled for 2011. “Apache, Chinook and Little Bird rotorcraft are all good candidates The remaining three aircraft are scheduled for delivery in 2012. to meet Korean budget, schedule and performance requirements,” KAI will modify the aircraft and install mission system equip- Nichols said. “As with other Boeing commercial and military pro- ment. Modification of the first aircraft will occur at a Boeing facil- grams, industrial partnerships with Korean companies would be a

In June, Boeing delivered a 777-200ER (Extended Range) airplane to Asiana Airlines in the airline’s new livery— which features a tail design using traditional Korean colors on a gray background. J ere m ia h S cott p oto

36 October 2007 BOEING FRONTIERS n FEATURE STORY

Boeing Commercial Airplanes has been a partner of Korean Air since a 1970 sale of a Boeing 707. Below is a Boeing 777 jetliner in Korean Air livery.

Wantz p h oto Willia m Wantz

natural part of any rotorcraft sales to Korea.” He added that Boeing is uniquely qualified to meet Korea’s needs because of its network- enabled capabilities and proven rotorcraft platforms. A connected web Commercial aviation. Military procurement. Industrial partnerships. They’re part of a connected web of a long-term relationship between Boeing and Korea that is strengthening. It reaches back to the conflict on the Korean peninsula in the 1950s and into the future as the Korean economy and aerospace sector grows and prospers. Oberlin said the Boeing relationship with Korean partners has come a long way in recent years, in part because Boeing is improving its ability to do business outside the United States. “We have developed stronger and more meaningful partnerships because Boeing is doing a much better job operating globally,” he said. “We’re getting better at listening to global partners and learning from them, and we are attracting and retaining mul- tilingual employees with cross-cultural sophistication to help us operate everywhere.” n [email protected]

It’s our future Actions cited in this story show how employees are applying concepts of the Boeing Management Model to support the company’s business strategies. Here’s how.

b oein g p h oto • Integrated activities: Integrated global partnerships. As part of his activities as the 2007 Boeing Young Leader Program participant, Young Jin Kim visited the Alteon Training To learn more about the Management Model, visit http://bmm.web. Center in Korea. boeing.com on the Boeing intranet.

BOEING FRONTIERS October 2007 37 n FEATURE STORY Something for everyone in ‘Rocket City’ Broad skill base supports Huntsville’s many programs

By Amy Reagan

round-based Midcourse Defense, Future Combat Systems, SBI- net, the International Space Station. Even the 787 Dreamliner. GAll are among the biggest programs at Boeing; and the 2,700 Boeing employees in Huntsville, Ala., have a role in each of them. “The exciting thing about Huntsville is the diversity of work,” said Gina DeSimone, vice president of division operations for Missile Defense Systems and acting vice president of business operations for the site. “We literally have something for everyone.” With more engineers per capita than any other city in the United States, Huntsville is able to match its engineering talent with a growing customer presence that includes NASA, the U.S. Army and the Missile Defense Agency. “We have a tremendous wealth of knowledge and experience large- ly because of the diverse programs we support and the variety of skills needed,” said Dan Olberding, director of engineering and mission as- surance for Missile Defense Systems and Boeing Huntsville. Here’s a snapshot of the work being done at Huntsville, as seen through the eyes of some of the employees there.n [email protected] Cristina Benzenhafer Future Combat Systems

How does a young engineer-to-be from Michigan end up in Huntsville? For Cristina Benzenhafer, that answer is easy: a week at Space Academy at the U.S. Space and Rocket Center in Huntsville. Benzenhafer attended Space Academy during high school. She remembers how impressed she was with Huntsville and the prospect of working on a NASA or U.S. Army program, as most of the camp counselors planned to do once they graduated. So when the time came to choose a college, she chose the University of Alabama, Huntsville, and followed in the steps of her counselors. In her seven years at Boeing, Benzenhafer has worked on the International Space Station, satellites, and now Future Combat Systems—an Army transformation initiative linking soldiers to a wide range of weapons, sensors, and information systems by means of a mobile ad hoc network

architecture. She said her FCS experience has been great for a new ERIC S H IN D EL B O W ER P OTO systems engineer. “Working on FCS, I have the opportunity to be involved Cristina Benzenhafer worked on in all aspects of systems engineering—from ‘cradle to grave,’” she said. the International Space Station and “And we’re developing all-new technology. It’s amazing to see how much satellite programs before joining we’re really helping the warfighter.” Future Combat Systems.

38 October 2007 BOEING FRONTIERS n FEATURE STORY ERIC S H IN D EL B O W ER P OTO Reliability engineer Jon Franklin, displaying a composite skin/stringer panel as used on the 787, is one of 150 Huntsville Design Center engineers who support 787 design and development.

Jon Franklin get a clear perspective of Boeing’s overall business,” Franklin said. DESIGN CENTER/787 Engineers at the Design Center provide engineering design and analysis support on a wide range of programs. As a strength engineer, Franklin has Through his work at the Huntsville Design Center, Jon Franklin has traveled developed repair analytical processes, test plans and predictions for a lot of to a lot of Boeing sites and worked on many projects. Yet he’s found in his different Boeing products, most recently the 787. travels—to as far away as Moscow—there’s no place like home. “Because we work on so many different programs, we’re exposed to a “Huntsville is booming, but it’s still small enough that you really get to know wide variety of solutions,” he said. “So we have a pretty extensive experi- a lot of people. And because of the broad spectrum of disciplines here, you ence pool to pull from when we’re challenged.”

Debbie Barnett Ground-based Midcourse Defense

After spending seven years integrating payloads for SPACEHAB, Debbie Barnett now spends her days integrating test events for one of the United States’ largest missile defense programs. As the director of mission integration for the Ground-based Midcourse Defense program, Barnett is responsible for managing integration and execution of all ground- and flight-testing for the nation’s first operational system to defend against ballistic missile attacks. Barnett said GMD, which is designed to intercept and destroy long-range ballistic missiles during the midcourse phase of flight, is an ever- changing and exciting program. “This is a very dynamic program,” she said. “We have solid processes and a great relationship with our customer, ERIC S H IN D EL B O W ER P OTO and everyone is focused on ensuring that the system will be successful.” As the director of Mission Integration for the Ground-based Midcourse Defense program, Debbie Barnett oversees the end-to-end integration of the system’s tests.

BOEING FRONTIERS October 2007 39 n FEATURE STORY

30-year Boeing veteran Clint Jones has spent much of his career working on Integrated Missile Defense programs in Huntsville. ERIC S H IN D EL B O W ER P OTO

Clint Jones (above) Integrated Missile Defense

On a given day, Clint Jones may start his morning by reviewing a new business proposal. By noon he’s finalizing a new production line plan for the Avenger short-range air defense system. Before he calls it a day, he’s developing Lean production goals for the Aegis Ballistic Missile Defense program, a sea-based defense against short- to intermediate-range ballistic missile threats. Jones said new and interesting opportunities and challenges are one of the main reasons he’s spent 30 years working on Integrated Missile Defense programs in Huntsville. In addition, Jones applies his industrial engineering expertise to a range of U.S. missile defense programs including Arrow (the Israeli national missile defense system) and the Patriot Advance Capability–3 Missile, which uses hit-to-kill technology to intercept and destroy tactical ballistic missiles, cruise missiles and hostile aircraft. “Here I have the opportunity to use all my industrial engineering skills and expand my work experience across multiple missile defense programs,” Jones said. RONAL D B O WM AN P H OTO Engineer Shelby Basham trouble- shoots components of the Army Airborne Command and Control System in a Black Hawk helicopter at Fort Eustis, Va.

40 October 2007 BOEING FRONTIERS n FEATURE STORY

Reliability engineer Lemuel Means is considered a subject matter expert by NASA for aspects of reliability and maintainability for multiple ISS systems. ERIC S H IN D EL B O W ER P OTO Lemuel Means (above) International Space Station

Every day after school, Lemuel Means would hop off the bus in his home- town along Alabama’s Gulf Coast. He’d routinely plow through his home- work before even thinking about hanging with his friends. His diligence paid off later when he achieved his dream, an engineering degree that gave him the opportunity to work on NASA’s International Space Station. As a reliability engineer, he worked the design, development and test of Node 1, Lab and Airlock in the 1990s. Today he is considered a subject Shelby Basham (left) matter expert by NASA for all aspects of reliability and maintainability for multiple ISS systems and subsystems. His current work on the critical Advanced Systems second oxygen production system on orbit has resulted in award fee strengths for the Boeing ISS program. “It’s pretty neat to fly in a helicopter,” said Advanced Systems engineer After 15 years with Boeing, he’s still excited about his work and starry- Shelby Basham, “but flying in a helicopter as part of your job—that’s eyed about the space business: “There’s no place else I’d rather be.” something special.” And Basham’s been flying in helicopters quite a bit over the last few years, It’s our future integrating and testing the Army Airborne Command and Control System, a mobile command post placed in a Black Hawk helicopter. In fact, Basham Actions cited in this story show how employees are applying concepts has been certified to fly with the Aviation Applied Technical Directorate as of the Boeing Management Model to support the company’s business he continues to train users and troubleshoot the system. strategies. Here’s how. He said working closely with members and retirees of the military has • Growth and productivity: Lean+, through cross-enterprise been one of the most rewarding parts of his job. “There’s a big difference integration and process streamlining. between what a lab engineer envisions as a solution versus what the To learn more about the Management Model, visit http://bmm.web. average soldier wants or needs in the field,” Basham said. “Soldiers are boeing.com on the Boeing intranet. the ultimate end-users. They are our ultimate customer, and knowing the customer is paramount.”

BOEING FRONTIERS October 2007 41 n FOCUS ON FINANCE

Korean Air representatives observe the recent delivery of their new 777-200ER from the second-story window of the Everett Delivery Center. The handover also marked Boeing’s 3,000th widebody aircraft delivery.

A key BCA Contracts improves the delivery experience take-away for Boeing’s jetliner customers Wantz p h oto Willia m Wantz

By Patrick Summers “We designed the new delivery process to 2009, although specific numbers have not focus on the efficiency, service and sup- yet been released. isiting the aircraft Delivery Cen- port we need to meet our customers’ com- To better prepare for the boost in air- ters at Seattle’s Boeing Field or plex and changing business requirements,” plane deliveries, Contracts in November VPaine Field in Everett, Wash., dur- explained Contracts Vice President Kevin 2005 held an Accelerated Improvement ing peak delivery times can be like walk- Schemm. Workshop to design leaner, more efficient ing through the main terminal at a major It’s not a 9-to-5 job. Midnight or pre- and more responsive processes and sys- airport the day before a holiday. Airline dawn deliveries and “flyaways”—when tems. The Contracts Lean journey—with customers from around the globe crowd the airline representatives board their new a focus on improving the customer experi- the conference rooms, hallways and de- planes and leave for home—are not un- ence—embodies the mission of the com- parture lounges. Airplanes line up on the common. panywide Lean+ initiative to increase taxiway. You’ll even see travelers passing Airplane deliveries are on an upswing. capacity, facilitate growth and improve through baggage screening and security In fact, Boeing in June set a weekly record productivity. In addition to enhancing the checkpoints. for deliveries in a single week with 20 de- airplane delivery process, Contracts is de- Orchestrating the sometimes hectic liveries. veloping a life-cycle-management system delivery-day activities—including the Deliveries in 2006 were up 30 per- that will standardize work flows through- transfer of large amounts of funds—is the cent over 2005, with another 25 percent out the development and implementation responsibility of Commercial Airplanes increase expected this year (see chart on of customer agreements. Contracts. The organization has devel- Page 43). The growth is expected to con- oped a new airplane-delivery process that tinue, with guidance for 2008 at 515 to Many duties aims to increase customer satisfaction. 520 deliveries and an even higher total for Contracts’ range of responsibilities,

42 October 2007 BOEING FRONTIERS n FOCUS ON FINANCE which includes delivering airplanes, is and product offerings expanded, the volume unique in Commercial Airplanes. At the and complexity of customer transactions Delivering on more promises front end, Contracts is an integral part of also increased. The regional directors faced Recent full-year commercial jetliner every sales campaign. It plays a key role a greater need to be on the road at the cus- in developing business strategy and nego- tomers’ home offices. deliveries for Boeing. tiating deals that turn customer proposals Contracts works closely with its Com- Year Deliveries into definitive agreements. When it comes mercial Airplanes business partners and 2004 285 time to build the airplane—which can be airline customers in implementing and re- several years after the contract is signed— fining the new delivery process. “Custom- 2005 290 Contracts is the primary business interface er input is very important to us. We took 2006 398 with the customer through aircraft build the unique step to ask airline representa- and delivery. tives to be part of the interview process 2007 440-445* In the new delivery process, Contracts in the hiring of the newest delivery direc- 2008 515-520* created teams of delivery experts on-site tors,” Schemm said. * Based on delivery guidance contained at the Everett and Seattle Delivery Centers, Customers appreciate the inclusion. in The Boeing Company’s second-quarter with resources available to customers 24 “An upside for us of the new delivery pro- earnings report. hours a day, every day. The teams include cess is the chance to take part in the struc- delivery directors and support staff whose tured interview and hiring process,” said sole mission is to deliver the best-possible Steve Adams, vice president of Interna- experience to customers as they take formal tional Lease Finance Corp., a major air- people that we’re going to be working with ownership of their new Boeing airplanes. plane lessor. “It allows us to find the best for a long time.” “The business, financial and techni- fit for ILFC, our customers and Boeing. cal issues involved in airplane deliveries I’m able to meet candidates directly and Delivery day are more complex than ever before,” said ensure they understand the importance of On aircraft delivery day, delivery direc- Carola Parker, Contracts managing direc- all three in the agreement.” tors manage a process that brings together tor of operations and new airplane deliv- “We do business with a lot of vendors the legal, financial, regulatory, manufac- ery. “The on-site delivery teams ensure a in the purchase and maintenance of our turing and security elements involved in consistent level of service and support for aircraft. This is the first time we’ve had transferring aircraft ownership to a cus- our customers. They also are a key part of the opportunity to actively participate in tomer. our strategy to increase capacity and bet- hiring somebody who was going to be as- Deliveries follow a carefully executed ter enable Contracts to manage a changing signed to our program,” said Bill Rogers, agenda that includes business environment.” Southwest Airlines field service manager. • The Federal Aviation Administration “I would describe the Contracts delivery “We were able to help put in place the right or foreign regulatory agency, which issues process as ‘The buck stops here,’” added De- livery Director Peter Garland. “The delivery directors have the responsibility and expertise to resolve any outstanding contractual issues with the customers’ airplanes.” benefit of on-site experts The delivery teams are connected with a broad network that shares responsibility for ensuring customers are delighted with their Boeing aircraft. It includes Customer Engineering, Program Management Of- fice, Customer Quality Support and the factories—all facilitated by Field Opera- tions at Boeing Field and Paine Field. A primary benefit of having on-site experts dedicated to airplane deliveries is that fewer issues go unresolved until the day of delivery. “The delivery teams have a good working relationship with the field,” explained Jon Lewis, delivery team director. “We can represent the customer and Boeing at any step of the process.” Previously, Contracts regional directors, based at Commercial Airplanes’ headquar- Boeing Delivery Director Stephen Doug- ters building in Renton, Wash., were the pri- las (right) congratulates Mohsin Wali of mary business point of contact for custom- Emirates at the Everett Delivery Center amid activity surrounding the recent ers through the aircraft build and delivery delivery of a 777-200LR to the airline.

process. As aircraft and services sales grew p h oto Willia m Wantz

BOEING FRONTIERS October 2007 43 n FOCUS ON FINANCE a Certificate of Airworthiness (see related story on Page 18). • The transfer of funds from the customers’ bank or other lending institution. • The federal Transportation Security Administration, which in some circum- stances must issue a security waiver for a non-U.S airline to fly in U.S. airspace. TSA regulations in some cases require all personnel boarding an aircraft being delivered to a non-U.S. airline to be screened. Baggage X-ray machines, bomb-sniffing dogs and secure waiting rooms can be part of an aircraft delivery. In busy weeks, the delivery teams in both Everett and Seattle will repeat the delivery process several times a day. “One of the ways that I view deliveries is it’s either the last act in a sales campaign that started years ago, or it’s the first act in the next sales campaign with a customer,” Lewis said. “A superior delivery experience is part of building and maintaining a long-term customer relationship.” n Marian L ock h art p h oto [email protected] Delivery Director Lucy Yi (foreground, left) and Customer Engineer Kim Huang (left) review maintenance and flight manuals and other technical documents with a delegation from Shanghai Airlines during a recent 737-800 delivery at the Seattle Delivery Center. One of the final steps in the delivery process is the signing of all financial, legal and regulatory documents and the transfer of funds required to complete the transaction.

The customer’s perspective Boeing has worked hard to improve the jetliner-delivery process that its customers experience. Here’s what some airline representatives had to say about the changes. —Patrick Summers

Patrice Provost, Air France “Overall, it has been a wonderful experience. Contracts is really supportive and tries to accommodate our requests. I know your door is always open. Having delivery directors dedicated to us also helps with issues on the factory side. We can achieve anything by working together. Trust, confidence and respect are the key.”

It’s our future Richard Green photo Actions cited in this story show how employees are applying concepts of the Sang-Won Lee, Korean Air Boeing Management Model to support the “It is a big benefit to us to have delivery company’s business strategies. Here’s how. directors on-site who can settle issues that • Growth and productivity: Lean+, may come up in the factories. Delivery direc- through spreading factory improvements tors like Steve Douglas who have experience beyond production areas; strong focus on and knowledge of the issues can be a big customer satisfaction. help.” To learn more about the Management Model, visit http://bmm.web.boeing.com on the

Boeing intranet. Gail Hanusa photo

44 October 2007 BOEING FRONTIERS n FOCUS ON FINANCE Boeing stock, ShareValue STOCK WATCH Trust performance The chart below shows the stock price of Boeing compared to other aerospace companies, the S&P 500 index and the S&P 500 Aerospace and Defense index. Prices/values are plotted as an index num- ShareValue Trust is an employee incentive plan ber. The base date for these prices/values is Sept. 24, 2004, which generates three years of data. The that allows eligible employees to share in the prices/values on that date equal 100. In other words, an index of 120 represents a 20 percent improve- results of their efforts to increase shareholder ment over the price/value on the base date. Each data point represents the end of a trading week. value over the long term. The program—which runs for 14 years and Boeing vs. U.S.-based competitors ends in 2010—features seven overlapping investment periods. The program is currently in Periods 6 and 7.

Boeing vs. stock indexes and international competitors

Comparisons: Four-week comparison 52-week comparison Price/value Price/value Percent Price/value Percent 4-week, 52-week as of 09/21/07 as of 08/24/07 change as of 09/22/06 change BOEING 102.59 98.47 4.2% 77.25 32.8% The above graphs show an estimate of what a U.S. COMPETITORS “full 4-year participant” ShareValue Trust distribu- General Dynamics 82.96 79.98 3.7% 70.61 17.5% tion (pretax) would be for Periods 6 and 7 if the Lockheed Martin 103.20 100.02 3.2% 82.85 24.6% end-of-period average share prices were the Northrop Grumman 79.55 79.20 0.4% 67.66 17.6% same as the recent price shown. Raytheon 63.44 58.27 8.9% 47.23 34.3% The share price shown is the average of the day’s INT’L COMPETITORS high and low New York Stock Exchange prices. EADS * 20.28 21.36 -5.1% 22.33 -9.2% Updates to participant/employment data will be U.S. STOCK INDEXES made periodically. S&P 500 1525.75 1479.37 3.1% 1314.78 16.0% S&P 500 Aerospace 453.64 432.56 4.9% 346.38 31.0% For more information on the ShareValue Trust, and Defense Index visit http://www.boeing.com/share. * Price in Euros

BOEING FRONTIERS October 2007 45 n MILESTONES

Thomas Morrow, 28 Years Norman Seithel, 31 Years Jane Morse Keolker, 10 Years William Selinger, 41 Years Craig Morss, 20 Years David Selkowitz, 17 Years AROUND BOEING David Muenz, 41 Years Paul Seto, 29 Years Craig Murray, 23 Years John Sexton, 17 Years Commercial Airplanes Fabrication Horst Nehrenheim, 18 Years James Simms, 40 Years Ricky Nelson, 32 Years John Simms, 27 Years David Newberry, 30 Years Larry Smallwood, 25 Years begins support to P-8A Poseidon B.K. Nickels, 29 Years Edward Smith, 9 Years Charles Ottenad, 44 Years Jin Sohn, 21 Years Wendell Oyama, 26 Years Henry Sorensen, 30 Years Kathleen Padilla, 24 Years Lagolden Spearman, 20 Years Julian Palacios, 30 Years William Springer, 42 Years Peter Pavidis, 12 Years David Stillings, 27 Years Richard Pequeno, 30 Years Robert Stitt, 34 Years Michael Perkins, 16 Years Patrice Stockdale, 18 Years Garfield Perry, 27 Years Duane Swanson, 33 Years William Peterson, 10 Years Masako Takarada, 31 Years Melvin Pico, 20 Years Raymond Tamaru, 20 Years Pearl Plant, 16 Years Paul Tebrink, 37 Years William Plath, 31 Years Earl Tennon, 40 Years Henry Pratti, 26 Years Patti Thomas, 27 Years Beverly Proost, 21 Years Terry Thorpe, 15 Years Stanley Pruett, 4 Years Mavis Tugby, 41 Years James Rams, 39 Years Gerald Tuttle, 39 Years Raymond Randall, 13 Years Edward Vallieres, 48 Years William Randle, 45 Years Walter Viebrock, 27 Years Brenda Recman, 25 Years Dennis Vogt, 40 Years Judith Redmond, 10 Years Lester Waganer, 41 Years Robert Reuter, 19 Years Alan Walker, 22 Years David Rhodes, 32 Years Oliver Watson, 46 Years Larry Richardson, 18 Years James Wells, 18 Years William Rigby, 40 Years Ian Whittaker, 41 Years Jimmie Riley, 38 Years Jerry Wilkison, 27 Years Leroy Roberts, 21 Years Eric Williams, 19 Years James Rockafellow, 44 Years Norma Williams, 40 Years Madeline Rodriguez, 26 Years Shirley Wilson, 38 Years

James Rose, 18 Years Karen Wimberly, 26 Years jim anderson photo Steven Ross, 40 Years George Winchell, 33 Years The Commercial Airplanes Fabrication team in Auburn, Wash., is beginning the William Rothschild, 9 Years Leroy Winters, 19 Years manufacture of airplane stringers for the fuselage of the P-8A Poseidon, an Dwight Rousu, 40 Years Clifford Wood, 28 Years antisubmarine warfare, surveillance and reconnaissance aircraft. Rich Harrison Bruce Rowe, 28 Years James Workman, 19 Years of Integrated AeroStructures (above) is one of several stringer press operators Mark Rubeck, 34 Years Kingo Yamamoto, 22 Years who supports the program and will run the 250-ton joggle press pictured here Willie Sanders, 23 Years Edwin Yasutake, 22 Years as part of the stringer manufacturing process. The U.S. Navy plans to purchase Robert Scott, 27 Years up to 108 aircraft to replace its aging fleet of P-3 aircraft.

IN MEMORIAM The Boeing Company offers condolences to the families and friends of the William Hunter, estimating and pricing specialist; service date Jan. 20, 1968; died following employees, whose deaths recently have been reported. Sept. 9 Roger Hussong, industrial hygiene and safety specialist; service date Feb. 15, 1991; Frederick Allinson III, materials processing/requisition facilitator; service date May died Sept. 1 4, 1991; died Sept. 19 Ben Ishino, structural analysis engineer; service date June 15, 1960; died Sept. 18 Zaharias Andrias, special projects mechanic; service date July 20, 1977; Joann Kallaher, expediter; service date Nov. 15, 1978; died Sept. 5 died Aug. 26 Marlene Lange, office administrator; service date July 10, 1968; died Aug. 30 Raymond Beaird, sheet metal assembler; service date June 25, 1973; died Sept. 10 Michael Lischke, engineering multiskill manager; service date Aug. 8, 1983; died Sept. 20 Keith Beatty, test and evaluation lab technician; service date July 15, 1996; died Sept. 13 Tara Malone, assembler/installler; service date March 31, 1989; died Sept. 13 Jesse Bettes, product data management support; service date March 5, 1997; David Rozek, numerical control tape laminator/operator; service date Jan. 21, 1985; died Sept. 6 died Sept. 19 Beverly Clark, communications specialist; service date Sept. 21, 1980; Harlan Tucker, supplier quality specialist; service date Nov. 2, 1961; died Sept. 8 died Sept. 16 Dioncio Valdez, wire design and installation engineer; service date Oct. 28, 1979; Lap Dao, engineering manager; service date Aug. 22, 1983; died Sept. 14 died Sept. 16 Michael Delger, integrated scheduling specialist; service date July 15, 2005; James Verkade, test and evaluation engineer; service date June 19, 1978; died died Aug. 29 Sept. 3 John Glore, supply chain specialist; service date March 15, 1964; died Sept. 4 Dan Ziegler, property management specialist; service date Aug. 23, 1971; died Sept. 4 Kerry Hammons, assembler/power plant specialist; service date July 28, 1977; died Sept. 19

48 February 2007 BOEING FRONTIERS BOEING FRONTIERS October 2007 49 n SPOTLIGHT

The ABL installation drawing team is made up of employees from Boeing, Northrop Grumman and Wyle Laboratories. orp. p h oto b y K ellie Masters T y b rin C orp. Airborne Laser installation drawing team

he Airborne Laser, a modified Boeing 747-400F, provides speed-of-light capability to the warfighter to destroy ballistic missiles in their boost phase of flight. As you can imagine, the ABL installation drawings constitute a very Tcomplex and large work package with drawing signatories located at multiple sites. We were great at getting drawings 95 percent complete, but we struggled getting approvals from all the groups necessary to get them released. Accordingly, we held a series of Lean meetings with all stakeholders, including our partner Northrop Grumman. The result was several process improvements: • By value stream mapping in detail our original process, we recognized that all drawing signatories were not reviewing the same drawings at the same time. So we implemented new management tools to ensure that all reviews were performed in-phase. • We identified certain reviews that historically had consumed significant flow time but rarely resulted in drawing mark- ups. We completely eliminated these. • We uncoupled drawing reviews that had been performed in series to allow parallel activity. Consequently, we’ve increased our weekly drawing release rate nearly fourfold and decreased the number of hours it takes to create and release them by 45 percent. We’re not quite finished, but we’re ahead of schedule and have only six of the required 325 installation drawings to go. Back row, from left Middle row, from left Matt Keller Charles Taylor Eliseo Arteaga Rolando Mendez Ron Whitlock Jose Gomez Dave Walker Northrop Grumman Northrop Grumman Northrop Grumman Northrop Grumman Wyle Laboratories Boeing Wyle Laboratories

Front row, from left: Clint Born Steve Ciralli Thanh Nguyen Pat O’Neal Jeff Rautenberg Thai Huynh Scott Baker Ken Stanfel Boeing Wyle Laboratories Northrop Grumman Wyle Laboratories Northrop Grumman Northrop Grumman Wyle Laboratories Boeing

50 October 2007 BOEING FRONTIERS BOEING FRONTIERS October 2007 51 BACK