Innovation is not often synonymous with administration, but the Shared Services Group (SSG) can lay claim to being the "PhantomWorks" of the Boeing office. "We are becoming more and more the change incubator for Boeing," says SSG president Bonnie Soodik.
SSG is leading work into virtual work environments because "buildings do not generate revenue - people do", and the group runs Boeing's real-estate company. The goal is to create a network-centric business environment within the company, where data is available to everyone. "Working virtually will allow us to follow the sun," says Soodik. SSG is also tasked with "leaning out" the office.
"Shared Services is a bit unique in the aerospace industry, and unique in its breadth," says Soodik. With an annual operating budget of $3.2 billion, excluding a non-production procurement budget of $3.5 billion a year, and 16,000 employees at 51 locations in seven countries, "we would be a Fortune 250 company in our own right". But SSG is a cost centre, reporting directly to Phil Condit, and is required to reduce its costs year on year.
"Since being formed in 1998, we have saved well over $1 billion in operating costs and $1 billion in non-production procurement," says Soodik. E-procurement is a becoming a major factor. SSG created BCA's MyBoeingFleet.com portal for operators and oversees Boeing's involvement in the Exostar multi-company exchange.
The group began reverse auctions last year and saved over 30% on more than $100 million in transactions ranging from building demolition to C-17 tooling. "That will double this year," says Soodik.
SSG's services include computing and communications, information and infrastructure security, payroll and non-production purchasing, and Boeing's own travel and real-estate companies. The group is creating web-based front ends for its various services. "You can go to a website and create a meeting,"says Soodik.
The group creates value for Boeing in four ways, says Soodik - driving overhead costs down year on year; economies of scale in non-production procurement; investing in the future; and preventing "value-destroying action", which includes ensuring compliance with export restrictions and developing disaster recovery plans.
Despite the success of Shared Services, Boeing is not looking to make it into a business. "Every large shared services organisation that has moved to service external customers has lost focus and collapsed," says Soodik.
Source: Flight International
