Boeing is to merge its military business with its space and communications division, creating a new Integrated Defense Systems unit. The move is intended to position the company to handle future "network-centred" contracts better.
Chief executive Phil Condit says that the reorganisation will neither involve job cuts or save the company money. The new division will be based in St Louis, Missouri, employ 78,600 people worldwide and have an estimated turnover of $23 billion.
Head of Space and Communications, Jim Albaugh, will lead the new division. Jerry Daniels, chief executive of Military Aircraft and Missile Systems, will retire once the reorganisation is complete - within six months, says Condit.
The move will end anomalies in Boeing's military operations. Several military programmes, such as the E-3 Sentry airborne warning and control system, fall under Space and Communications, and Condit believes that the ability of "future systems" to operate in the network is crucial.
"Integrated solutions - joining network-centric information with integrated military air, land, sea and space-based platforms - is the direction modern defence systems are moving," says Condit.
He adds that recent gains by Space and Communications, including the US Army's Future Combat System, validates the network-centric strategy.
The restructuring "should speed up the move to double digit operating margins" for both military and space operations, Condit says.
Source: Flight International
