AlliedSignal Aerospace will complete a major restructuring of its organisation by the end of this month, in a move designed to reduce costs and complexity, and to simplify supply chains and improve market focus and profitability.
"We've organised our businesses in the way our customers buy," says AlliedSignal Aerospace president and chief executive Bob Johnson. The company's traditional businesses have therefore been re-grouped into four major product, systems and service units: those of engines and systems, avionics and lighting, aerospace services and aircraft landing systems. Intersecting these are three specially created marketing units responsible for marketing and sales of all products in the air-transport and regional market, the business and general-aviation sector, and the defence and space arena.
The move is expected to improve market focus and to make it easier for customers to work with the company in general. The restructuring builds on earlier re-alignments which, essentially, saw AlliedSignal Aerospace operating as four individual companies.
"We did not have the strength of being totally integrated. We tried for a while to work as four separate companies, but the message from our customers was that we were still hard to work with," adds Johnson. "One of the biggest complaints we have had is the supply chains have been too complicated," he says.
The recently appointed president believes that the new organisation is "an evergreen structure that will let us grow", and represents a less centralised - but more integrated - picture. Johnson also says that the revamp should help the organisation realise up to 7% growth in business this year, with sales of around $8 billion expected. This could grow to around $10 billion by 2001, he adds..
Three key strategic elements also form part of the revised plan. These include the continued growth of AlliedSignal's profitable services businesses, tighter targeting of new opportunities in key markets, and leveraging its widely acknowledged industry leadership in safety systems such as enhanced ground proximity warning, traffic alert and collision avoidance and windshear warning systems.
These, and other safety-related systems, account for sales of $1 billion. The aerospace aftermarket businesses account for 50% of the company's total sales, while technical services generate 10% and original equipment the remaining 40% of revenue.
Source: Flight International
