Issuu on Google+

Horizons

15 Issue 41 > 2009 2010 Volume 14

A magazine for the employees and friends of Rockwell Collins, Inc.

What’s ahead? A look at how we’re positioning our company for success. Page 5 >

Four steps to enhance your career Page 2 > Staying on course Page 18 > A unique relationship Page 20 >

www.rockwellcollins.com/horizons


A year of transition

A

s I’ve said in my recent Business Update meetings across our company, one of the benefits of change is the fact that the more we experience it, the better we get at adapting to it. Over the years, our company’s ability to adjust to anticipated changes has provided us with the flexibility and agility to handle those we didn’t – or couldn’t – see coming. In this issue of Horizons, you’ll find several articles that explain the changes that we’re experiencing in our markets and our program pursuits.

In Commercial Systems, we’re transitioning from a very challenging economic environment, but we’re observing signs of stabilization. In Government Systems, we reported record levels of sales in FY’09, but we’re seeing the end of several years of midto high-single-digit growth in United States defense budgets. At the same time, in Rockwell Collins Services, we’re realizing the benefits of expanding our breadth of service offerings and a balanced business in commercial and government marketplaces. So while it’s clear that 2010 will be a year of transition, I feel good about the position of our company.

Horizons

Horizons

Volume 15 > Issue 1 > 2010

Volume 15 > Issue 1 > 2010

Publisher: David Yeoman Editorial director: Dan Sandersfeld

2 > Four steps to enhance your career Rockwell Collins recently launched a new toolkit to help you with career development planning.

Editorial team: Managing editor: Robert Fleener +1.319.295.8791 Editor: Crystal Hardinger +1.319.295.3932 Staff writers: Cindy Duran +1.319.263.1573 Karen Hildebrand +1.319.295.5762 Marielle Rodeheffer +1.319.263.1160 Jill Wojciechowski +1.319.295.4998 Copy editors: Ruth Anne Denker +1.319.295.0643 Karen Steggall +1.319.295.5327

The market share we’ve gained in the last five years in Commercial Systems has not gone away. Our long-term strategies to move into adjacent markets and do more system and subsystem integration work are helping us grow in Government Systems. And if Rockwell Collins Services continues to build upon its FY’09 accomplishments, FY’10 will be a benchmark year. As you’re reading this issue, you’ll recognize common themes that I regularly emphasize. Investing in the future, expanding our business, building strong customer relationships, developing our people, and Lean Electronics are strong enablers for our success. I hope these articles provide you with additional insight on how we’re preparing for the future and the changes ahead.

Clay Jones Chairman, President and CEO

COV E R STO RY

5 > What’s ahead?

A look at how we’re positioning our company for success.

6 > Focused on the upturn

Commercial Systems is well positioned to capture business as the economy recovers.

Freelance writer: Jill Brimeyer, Ankeny, Iowa

How to contact us: Email: empcomm@rockwellcollins.com Mailing address: Horizons Rockwell Collins M/S 124-302 400 Collins Road NE Cedar Rapids, IA 52498-0001 Phone: +1.319.295.1000 Fax: +1.319.295.9374 Web address: www.rockwellcollins.com/horizons

How to contact the Ombudsman: Phone: +1.866.224.8137 or +1.319.295.7714 Email: ombudsman@rockwellcollins.com

Horizons is published by Rockwell Collins Enterprise Communications for our employees, retirees, shareowners and customers. We seek to inform and inspire our readers by incorporating our company’s Vision, business goals and other enterprise-wide initiatives throughout our publication. We also strive to spotlight issues that affect our employees, our company and our industry. ©2010 Rockwell Collins, Inc. All rights reserved.

On the cover > A circuit board, which is an essential part of Rockwell Collins’ electronics solutions, is used to connect and position electronic components. While each piece on the board has its specific function, if the board is designed and implemented effectively, the pieces will work together to achieve a more complex and greater function. In a similar way, Rockwell Collins’ goals and strategic framework make up the structure that connects and positions our company for success. While each department has a specific function, if our goals and strategies are designed and implemented effectively, together as an enterprise, we’re able to achieve more.

10 > Maintaining momentum

Government Systems focuses on growth in spite of tightening defense budgets.

14 > Expanding offerings Rockwell Collins Services has doubled its business in five years.

18 > Staying on course

Lean Electronics helps Rockwell Collins remain competitive.

Also in this issue 20 > A unique relationship 21 > Service anniversaries Back cover > Facility spotlight: Heidelberg, Germany

Executive profile

Web extra feature story Offering perspective Bobby Sturgell brings unique insight to our company through his experiences as a fighter pilot, TOPGUN instructor, commercial pilot and acting FAA administrator. www.rockwellcollins.com/horizons/volume15-issue1/executive-profile


Four steps to enhance your

Step 1 Identify what you want to experience or where you want to be in three to five years.

career

llins Dark Yellow* ANTONE 131 r: C:0 M:30 Y:100 K:10 229 G:168 B:17 (#D39100)

W Rockwell Collins Light Blue Spot color: PANTONE 299 Process color: C:80 M:15 Y:0 K:0 RGB color: R:0 G:164 B:224 (#00A0E2)

Rockwell Collins recently launched a new toolkit to help you with career development planning.

llins Dark Green PANTONE 371 By Cindy Duran or: C:43 M:0 Y:100 K:56 :79 G:111 B:23 (#4A5F1D)

W

Rockwell Collins Extra Light Blue* Spot color: PANTONE 2915 Process color: C:60 M:5 Y:0 K:0 RGB color: R:77 G:190 B:238 (#63B5E8)

hat does your dream job look like? What energizes and motivates you? Do you like being the leader of a group? In three to five years, llins Green what role do youRockwell see yourself in?Gray Collins Dark ANTONE 385 If you know the answers to these Spot color: PANTONE Warm Grayon 10 the questions, you’re r: C:3 M:0 Y:100 K:58 Process color: C:0 M:14 Y:28 K:55 right track when it comes to career development planning. If 129 G:124 B:0 (#6F6A12) RGB color: R:138 G:121 B:102 (#7B6E66) you don’t, there has never been a better time to start thinking about your professional goals for the future. At the beginning of the fiscal year, Rockwell Collins lins Light Greenintroduced a comprehensive toolkit to Collins assistGray employees with Rockwell ANTONE 384 Spot color: PANTONE Warm Gray 8were career development planning. These resources – which r: C:18 M:0 Y:100 K:31 Process color: C:0 M:9 Y:16 K:43 developed in response to feedback from our Voice of the 159 G:166 B:21 (#8B9000) RGB color: R:161 G:149 B:138 (#92877F) Employee survey – can help you identify ways to grow in your current role and, if desired, prepare for new opportunities within our organization. ollins Extra Light Green* Rockwell Light Gray they’re “We know that when our people areCollins developing,

PANTONE 583 or: C:23 M:0 Y:100 K:17 R:175 G:188 B:31 (#ABB400)

realizing their full potential,” said Rod Dooley, vice president of Talent Management and Diversity. “This then enables our company to realize its full potential, so we want to do everything possible to help employees reach their development goals.” If you’re new to the idea of career planning, or if it’s been a while since you updated your career plan, a good place to start is with the four-step career development process under the “Career & Benefits” tab on Rockwell Collins Online. At first glance, it may seem like a lot to think through; but you don’t have to make all the decisions by yourself. The process was designed for you to be able to obtain advice from your leader, a mentor or someone familiar with your role. In the next pages, we’ve profiled four employees who already have gone through the decisions that come with each step. Of course, their career development plans – like any ongoing process – are ever changing and never final.

Spot color: PANTONE Warm Gray 4 Process color: C:0 M:4 Y:9 K:24 RGB color: R:201 G:193 B:184 (#BDB6B0)

Tap into our new tools User-friendly career development Web site –

ollins Dark Blue Rockwell Collins Extra Light Gray* Rockwell Collins employees areSpot encouraged to visit the PANTONE 2955 color: PANTONE Warm Gray 2 or: C:100 M:45 Y:0 K:37 Career Development page under the color: “Career & Y:5 Benefits” tab Process C:0 M:2 K:9 R:0 G:82 B:136 (#003B6F) RGB color: R:233 G:227 B:220 (#D9D5D2)

on Rockwell Collins Online to learn more about the four-step process: Identify, Assess, Plan and Execute.

Career Development tab within the PR&DP tool – ollins Blue Black* The new tab allows employees Spot to document growth plans as PANTONE 300 color: Process Black or: C:100 M:40 Y:0 K:0 they look beyond their current responsibilities. can Process color: C:0 M:0Employees Y:0 K:100 R:0 G:125 B:197 (#0068C6) RGB color: R:0 development G:0 B:0 (#232020) plans, determine who has access to their career and it stays with employees from one year to the next.

Rockwell Collins University – All corporate training is now housed in our online university’s eight schools of learning. Course offerings and registration continue through the Learning Management System, but it is now found within the university. Career development workshops – Available for both employees and leaders, workshop content provides additional information on the career development process – including tools and role definitions. New sessions will begin soon.

hen Gregg Ballew started as a third-shift service center technician at our company in 1990, he hoped to someday be a manager. While he wasn’t sure what career moves would come next, he knew what experiences he needed over time in order to achieve his long-term goal. “I had the willingness to accept new roles and assignments with increased levels of accountability and responsibility,” said Ballew. “I was able to move out of my comfort zone and do things that I was not sure that I could do. Career development is a long journey, and you need to go out and take risks.” Today, his past job experiences – such as coordinating test equipment repair and calibration, implementing information technology systems, solving problems for customers, and supervising small groups of people – have prepared him for his current role as manager of the Avionics Service Center in Atlanta, Ga. In addition, the relationships Ballew has developed over time with customers, mentors, leaders and other employees have helped him identify and pursue new opportunities. “The development of key relationships with people

2

HORIZONS > 2010

is essential for success,” he said. “I have developed an understanding of the business from the customer’s viewpoint, and I’ve found that to be critical. Also, every manager I have worked for at Rockwell Collins has given me opportunities to grow.” And even though Ballew is where he’s always wanted to be, he hasn’t stopped planning. “My PR&DP is focused on next steps for moving into a director position,” said Ballew, who is currently working on a master’s degree in business administration. “I’m preparing to go to the next level.”

Step 2 Assess what additional knowledge, skills or abilities are required to achieve your career plan.

A

s a high school student, Lissa Bern knew she wanted to pursue a career in an aviation-related field. And in 2005, after completing a master’s degree in safety science from Embry-Riddle Aeronautical University, she was able to do just that. Bern started at Rockwell Collins as a safety engineer, and was later promoted to a senior systems engineer in Design Engineering Support in Commercial Systems. “Pursuing something you have an interest in or some sort of skill you would like to develop helps you determine what you want to attain,” she said. Now, with nearly five years of experience at our company, she’s assessing her current knowledge, skills and abilities and determining what she needs to meet future career goals. “The process I have developed is my own, which makes it work for me,” said Bern. “It also helps to surround yourself with knowledgeable people who can guide you in the right direction and provide you with useful resources.” (Continued on Page 4)

*This color may be used as a tint or percentage.

Photo by Ron Sherman, Roswell, Ga.

> Gregg Ballew, manager of the Avionics Service Center in Atlanta, Ga., identified early in his career that someday he wanted to lead a service area.

Photo by Paul Marlow, Cedar Rapids, Iowa

> Lissa Bern, a senior systems engineer in Design Engineering Support in Commercial Systems, will celebrate her five-year anniversary with our company soon. For her, it’s a good time to assess what she needs to obtain future career goals. VOLUME 15 > ISSUE 1

3


Step 3

What’s ahead?

Plan what activities will help you to prepare.

W

illie Croghan, principal marketing manager in Government Systems, often has had help planning the next step in his career. “I’m not any smarter than anyone else,” said Croghan, “but I’ve been smart enough to listen to what leaders and peers have suggested to me.” When Croghan started at Rockwell Collins in 1988 in the Information Technology department for Commercial Systems, he never imagined that with a degree in computer science, he would someday be part of the Government Systems marketing team. But, with guidance from leaders, colleagues and mentors, he’s been able to blend the experience he’s gained at our company and in the United States Army Reserves to move into a role that is focused on marketing and development. “You need to be ready when opportunity knocks,” said Croghan. “Career development is about extending beyond your current skills and knowledge – not how many times you’re promoted.”

Step 4 Execute your plan!

S

hortly after Sharron Dennis started in our Quality organization in Dallas, Texas, in 1981, she became interested in Visual Basic applications programming and developing small applications systems. It was then that she knew she wanted to pursue a career in computer science. But with an associate’s degree in fashion merchandising, her career goal wasn’t easy to execute. Still, for the next 13 years, she went to college at night while working for our company. During that time, she also networked with Information Technology professionals and made her career goal known to others. “I was very fortunate to have managers that allowed me to venture and undertake projects that were not only of interest, but helped me grow professionally,” said Dennis, who moved from Quality to Component Applications Engineering in 1984. “Many of these managers continue to provide me with professional advice and guidance today.” After she graduated with a bachelor’s degree in computer science from the University of Texas at Dallas, she became a member of the Dallas Product Data Management (PDM) team, which is now part of e-Business. Today, she is a principal business integration analyst for PDM. HORIZONS > 2010

A look at how we’re positioning our company for success.

L

Photo by Paul Marlow, Cedar Rapids, Iowa

> Willie Croghan, principal marketing manager in Government Systems, believes it’s important to keep an open mind as you’re planning for the future because sometimes it’s easier for other people – such as leaders, colleagues and mentors – to see your potential.

“My passion for customer satisfaction and process improvement played an important role as I made decisions throughout my career,” said Dennis. “But, I found things that were of interest to me and that would also help the enterprise get to where it was headed.” <h>

ike so many companies around the world, Rockwell Collins faced extraordinary challenges in the past year due to the economic downturn. One of the most severe impacts occurred in our Commercial Systems business, where we saw a 21 percent decline in revenues for FY’09 due to market circumstances that were largely beyond our control. Yet, the hard work and dedication of our employees, a successful shared services business model and the strategic balance between commercial and government businesses once again proved to serve us well. In FY’09, we reported sales of $4.47 billion, down 6 percent from FY’08, as the decline we experienced in Commercial Systems revenues was partially offset by a 9 percent increase in Government Systems sales. In the first quarter of FY’10, Rockwell Collins’ sales decreased $31 million, or 3 percent, to $1.027 billion compared to sales of $1.058 billion for the same period a year ago. Just as in FY’09, this was primarily driven by the impact of the global recession on Commercial Systems. Still, Government Systems achieved sales of $616 million in the first quarter of FY’10, an increase of $42 million, or 7 percent, compared

to the $574 million reported for the same period last year. These numbers, according to Rockwell Collins Chairman, President and CEO Clay Jones, indicate that our business model and strategic balance continue to work through good times and bad. But, there are still challenges to overcome in FY’10, important goals to achieve and new obstacles on the horizon. “When we began FY’09, we had no idea that things were going to play out the way they have,” said Jones. “Last year, our greatest area of uncertainty and risk was Commercial Systems, while Government Systems continued to be the area of stable outlook. Now, we’re beginning to see signs of stabilization in our commercial markets, but given the cycle of our business, we have to remain alert for positive and negative trends in both sectors.” To give you a better understanding of what we’ll likely see in the year ahead and how we’re preparing for the future, the following pages provide an outlook for our marketplaces, including personal insights from senior leaders in Commercial Systems, Government Systems and Rockwell Collins Services.

By Crystal Hardinger and Jill Wojciechowski • These articles may contain forward-looking statements including statements about the company’s business prospects. Actual results may differ materially from those projected as a result of certain risks and uncertainties, including but not limited to those detailed from time to time in our earnings press releases and Securities and Exchange Commission filings. Photo by Brandon Jennings, Richardson, Texas

> Sharron Dennis, a principal business integration analyst in e-Business, ensured she had support from her managers to execute her career development plan by aligning her personal career interests with our company’s interests. VOLUME 15 > ISSUE 1

5


What’s ahead?

Commercial Systems

Focused on the upturn Commercial Systems is well positioned to capture business as the economy recovers.

S

llins Dark Yellow* Rockwell Collins Light Blue enior leaders in Commercial Systems are quick to ANTONE 131 Spot color: PANTONE 299 admit that they’ve never been happier to see a year r: C:0 M:30 Y:100 K:10 Process color: C:80 M:15 Y:0 K:0 229 G:168 B:17 (#D39100) come to an end. RGB color: R:0 G:164 B:224 (#00A0E2)

Due to the most significant economic recession in decades and the worst credit crisis in our lifetimes, much of 2009 was focused on managing our Commercial Systems Rockwell Collins Extra Light Blue* llins Dark Greenbusiness through the downturn. Spot color: PANTONE 2915 PANTONE 371 “The health of the economy drivescolor: both business Process C:60our M:5 Y:0 K:0 or: C:43 M:0 Y:100 K:56 RGB color: R:77 G:190 B:238Bryan (#63B5E8) :79 G:111 B:23 (#4A5F1D) aircraft and airline market segments,” explained Vester, vice president of Commercial Systems Strategy Development. “So if we look at the cycle we just went through, nearly everything in our marketplace was impacted by the economic llins Green Rockwell Collins Dark Gray ANTONE 385 crisis.” Spot color: PANTONE Warm Gray 10 Generally, when a weak economy travel spending, r: C:3 M:0 Y:100 K:58 Processimpacts color: C:0 M:14 Y:28 K:55 129 G:124 B:0 (#6F6A12) RGB color: R:138 G:121 B:102 (#7B6E66) airline revenue and profits decrease, and that affects their ability to buy new or upgrade existing aircraft. At the same time, lower consumer spending translates to lower corporate profitability, and that impacts the business aviation lins Light Green Rockwell Collins Gray ANTONE 384 marketplace. Spot color: PANTONE Warm Gray 8 r: C:18 M:0 Y:100 K:31 “In the last year, we saw mostProcess of ourcolor: markets erode, C:0 M:9 Y:16 K:43 but 159 G:166 B:21 (#8B9000) RGB color: R:161 G:149 said B:138 (#92877F) I think we’re very close to the worst being over,” Kelly Ortberg, executive vice president and chief operating officer of Commercial Systems.

ollins Extra Light Green* Rockwell Collins Light Gray PANTONE 583 Long-term positions are strong Spot color: PANTONE Warm Gray 4 or: C:23 M:0 Y:100 K:17 Ortberg says FY’10 is sureProcess color: C:0its M:4own Y:9 K:24 While to present challenges, R:175 G:188 B:31 (#ABB400) RGB color: R:201 G:193 B:184 (#BDB6B0)

his outlook for the future is optimistic. Rockwell Collins has several significant positions on key airplanes that most likely will enter service during the recovery phase of this economic ollins Dark Blue cycle. Rockwell Collins Extra Light Gray* PANTONE 2955 For example, in the air transport Rockwell Spot marketplace, color: PANTONE Warm Gray 2 or: C:100 M:45 Y:0 K:37 Process color: C:0 M:2 Y:5 K:9 Collins avionics solutions are standard equipment on the R:0 G:82 B:136 (#003B6F) RGB color: R:233 G:227 B:220 (#D9D5D2) Boeing 787, the Boeing 747-8 and the Airbus A350, providing potential revenue for the next two decades. In the business and regional aviation marketplace, our Pro Line Fusion™ avionics system has been selected for ollins Blue Black* PANTONE 300 aircraft being built by Bombardier, Gulfstream and SpotEmbraer, color: Process Black or: C:100 M:40 Y:0 K:0 Process color: C:0 Venue™ M:0 Y:0 K:100 Mitsubishi. Additionally, our high-definition Cabin R:0 G:125 B:197 (#0068C6) RGB color: R:0 G:0 B:0 (#232020) Management System will be offered in Hawker Beechcraft and Cessna aircraft.

> Interest in upgrades – Rockwell Collins’ Wide Area Augmentation System (WAAS) Localizer Performance with Vertical guidance (LPV) functionality allows pilots to perform precision approaches at airstrips like this one. This flight management GPSbased navigation upgrade is one of several aftermarket solutions that are expected to be popular this year.

“FY’10 is a critical year because we have a lot of ongoing development programs,” said Ortberg. “Our key focus right now is preparing the organization to capture the market recovery. We’re anticipating that we’ll start to see the recovery in the second half of FY’10, so we’re making sure our products and our solutions are ready.” According to Vester, positioning our company to gain market share in areas that are expected to grow in the next few years is essential. An example of this is the international and domestic trip support segment within our Information Management business. In late December, Rockwell Collins acquired Air Routing International, a provider of trip support for business aircraft flight operations. This acquisition provides expansion into a previously unaddressed market segment and enables us to deliver enhanced value to business aircraft operators. Opportunities for aftermarket solutions In the months following the terrorist attacks on Sept. 11, 2001, when deliveries from original equipment manufacturers were sluggish, leaders in our Commercial Systems business realized that there were still opportunities for aftermarket

solutions, which are upgrades added updates to their existing and modifications to existing airplanes,” said Mahoney. aircraft. “Despite the gloom and doom According to Colin Mahoney, out there, this aftermarket vice president of Sales and shining light is going to drive Marketing in Commercial a more positive outlook earlier Systems, that also is true than the new aircraft deliveries today. will.” Boeing image “The piece we’re most > Long-term opportunity – Rockwell Collins’ avionics solutions are standard Fine-tuning our excited about in FY’10 – and equipment on the Boeing 787 Dreamliner – which took to the sky for the first aftermarket strategy the piece we can actually time in December. Significant positions on key airplanes like this one are what In early 2009, used aircraft influence in this type of make Commercial Systems leaders optimistic about the future. inventory in business aviation economic environment – reached an all-time high of 18 is the aftermarket,” said percent. Since then, that number has come down and these Mahoney. “New airplane production rates are down, and there used airplanes are starting to sell – albeit at a discounted price. have been more program delays than launches, but Rockwell That’s good news for Rockwell Collins because when Collins has a very large install base, and that’s where we plan operators buy a pre-owned airplane, they typically want to to focus.” refurbish it to meet their individual requirements. Also, if Typically, when a company has an expansive install base – buyers are able to obtain aircraft well under market value, they which is the number of units of a particular system in may decide to make additional enhancements at the time of use – there’s demand for service and upgrades, even in a purchase. tough economy. “If I’m a business jet owner, and my aircraft has state-of-the For example, Rockwell Collins’ Wide Area Augmentation art capabilities, then its value to a future owner will be greater, System (WAAS) Localizer Performance with Vertical guidance and I’ll be able to sell it for more,” suggested Mahoney. (LPV) functionality is expected to be popular this year with “I might as well upgrade now and personally benefit from the business aviation customers who already own our upgrade instead of being forced to upgrade it later simply as a Pro Line 4 and Pro Line 21 avionics systems. This flight means to sell.” management GPS-based navigation upgrade allows operators It’s this mentality that has prompted Commercial Systems to perform precision approaches at airstrips where there is to fine-tune its aftermarket strategy for FY’10. The business is no precision landing capability, thus opening up previously focusing on several solutions designed for efficient installation restricted landing opportunities. during the change of ownership process to maximize our In our Cabin Systems business, customers who currently opportunity, as increasing numbers of pre-owned aircraft own Airshow® 4000s – an in-flight information application change hands in this environment. that provides passengers with real-time flight information, “We’re investing wisely in our products,” said Mahoney. moving maps, up-to-the-minute news, financials, sports “A lot of our research and development dollars are spent on and weather – likely will be interested in upgrading to our new programs, but we also benefit from prior investments as next-generation moving map product that has enhanced we update equipment that’s already in the field so we can grow functionality and capabilities. our aftermarket business.”

“Our key focus right now is preparing the organization to capture the market recovery.” —Kelly Ortberg

Additionally, when it comes to flight deck upgrades, a number of business aircraft customers who have avionics systems with older cathode ray tubes – such as Pro Line 2 and Pro Line 4 – are expected to upgrade to a Pro Line 21 system with liquid crystal displays this year. “With our aftermarket business, we have a broad group of customers that present opportunities for us to provide value-

Mandates drive air transport aftermarket While discretionary-type aftermarket sales are expected to occur in our business aviation market segment this year, Commercial Systems leaders believe airlines will begin buying aftermarket solutions once the economy recovers. “Right now, the airlines have a cost-cutting focus and, unlike aftermarket modifications in business aviation, aftermarket modifications in the air transport marketplace are pretty limited because the airlines don’t have the cash for discretionary purchases,” explained Ortberg. But once the airlines start to see greater revenues and maintain profits, products that improve (continued on Page 8)

*This color may be used as a tint or percentage.

6

HORIZONS > 2010

VOLUME 15 > ISSUE 1

7


What’s ahead?

Commercial Systems

Focused on the upturn (continued) navigation and efficiency and enhance in-flight entertainment options will likely be at the top of their list. Additionally, pending regulatory mandates in the United States and Europe offer opportunities for potential air transport aftermarket business in the years ahead. For instance, the Federal Aviation Administration (FAA) is proposing all aircraft flying in U.S.-controlled airspace be equipped with Automatic Dependent Surveillance-Broadcast (ADS-B) avionics by 2020, and the European Commission is working toward a 2015 deadline. The European Commission also has set deadlines of 2011 and 2015, respectively, for ensuring new aircraft and existing fleets are equipped with Link 2000+ services – a program that provides controllers and pilots with air/ground data link information.

“Despite the gloom and doom out there, this aftermarket shining light is going to drive a more positive outlook earlier than the new aircraft deliveries will.” —Colin Mahoney

“Mandates really drive our air transport aftermarket, so we’re building our value proposition around updating existing aircraft progressively,” said Mahoney. “Our goal is to influence airline decision makers to invest in upgrades earlier than mandates dictate in the interest of providing earlier access to these valueadded capabilities.” Looking ahead Since our Commercial Systems markets are so closely linked to the economy, cyclical trends usually give our company’s strategists some perspective for the future. According to Vester, aftermarket sales typically recover about a year before original equipment manufacturer sales in both air transport and business and regional aviation marketplaces. Given that we have been through these cycles before, our company’s leaders know how to deal with the downside and, more importantly, prepare for the upturn. “When the markets recover, you like to be able to offer innovative, new products, as opposed to old, stale ones,” said Ortberg. “Right now, we have a number of products that are in development and will start to enter the marketplace in the next three years, so I feel very confident that we’ll be able to seize those opportunities as they become available. “I also think we are very well positioned for the future because we won so many positions on key programs that span

8

HORIZONS > 2010

more than 20 years – such as the Boeing 787 and the Airbus A350,” he continued. “We just have to focus on the light that we see at the end of the tunnel.”

Q&A with Kelly Ortberg

K

elly Ortberg, executive vice president and chief operating officer of Commercial Systems for Rockwell Collins, has experienced both upswings and downturns since joining our company more than 20 years ago. And while FY’09 was a tumultuous year for Commercial Systems, he doesn’t see anything in this downturn that we haven’t overcome before. Here are excerpts of his conversation: How would you sum up the key focus areas in Commercial Systems for the next year? Right now, we’re preparing Commercial Systems to capture the market recovery. We began FY’10 near the bottom of the market decline, so we’re anticipating that we’ll start to see recovery in the second half of FY’10. The other thing is when the market is down, you really have to focus on execution. FY’10 is a crucial year for a lot of new developments. For example, it’s critical that our Pro Line Fusion™ avionics system achieves certification for two initial platforms – the Bombardier Global Express and the Gulfstream G250. Despite a tough year, industry executives – including those at Bombardier, Gulfstream and Cessna – are talking about stabilization in the business jet industry. Do you think the worst is over? I think we’re very close to the worst being over. New business jet orders likely will be sluggish throughout FY’10, so we won’t see our original equipment manufacturers increasing production rates until we get into the FY’11 time frame. What we do expect is that the used inventory rates will start to move and people will be upgrading their airplanes. That’s why we’re really focused on aftermarket solutions, which are upgrades and modifications to existing aircraft. The last year has been tough for the airlines because the weak economy has cut into business travel. What can we expect to see in this market segment in the near term? We’re starting to see some signs of traffic stabilization, but the fares are still very competitive. What that means is that the amount of money the airlines make per passenger is less, and that puts a lot of pressure on their profitability. Right now, the airlines are focusing on cutting costs, and we don’t expect that to change, frankly, until we see more recovery in the economy. Now, as fuel starts to spike up again, most airlines will continue to take delivery of more fuel-efficient airplanes. That

Photo by John Thomas, Cedar Rapids, Iowa

drives our original equipment manufacturing business. Both the Boeing 787 and the Airbus A350 offer significant improvements in fuel efficiency for the airlines, which will help their business models for non-domestic transportation. So, we still see both of those airplanes as being really critical. Our current level of investment in research and development projects is nearly the same as FY’08 when our sales were higher. Is there a reason for this? First of all, we made three- to four-year commitments to our customers when the market was going well, and we’re committed to carrying out those programs and core research and development products. We also recognize that this is just a cycle. We are in a cyclical market, and the worst thing you can do is stop investing in the future. If you do, you’re not going to have the products and solutions you need when the market recovers. Since our company’s spin-off in 2001, there have been 22 competitions for new business jet avionics positions – and Rockwell Collins won 21 of them. What does that say of our employees? When we focus on something, we do a good job. Many of these wins have been with our new Pro Line Fusion avionics system, and I think we hit the market right. We focused on what’s important to our customers, and the results speak for themselves. Where do you see potential for commercial business outside of the United States? People often ask, ‘Are our international marketplaces going to be more important in the future?’ Well, they have been extremely important for us here as of late. Our domestic business for Commercial Systems lately has been pretty depressed, so much of our business has been international. Key growth areas are with the airlines in China and India, as well as the Middle East, and a lot of our recent business has been in those regions.

Operational excellence through Lean Electronics is part of our strategic framework to accomplish our goals. How can Lean Electronics help us today amid this difficult economic climate? When we’re in a depressed market like we are now, Lean tools can help us get from where we are to where we want to be – by improving quality and performance, and eliminating waste. That’s why we’re going through a major activity in FY’10 to reinvigorate Lean Electronics, and to refocus and retrain our employees on what Lean can do for them. > Kelly Ortberg emphasizes that program execution is crucial right now, because when the markets recover, it’s important to have new, innovative products ready.

In 2002, you switched business units. What made you move? My whole career had been in Government Systems, and I knew at some point I needed to broaden my experience. Commercial Systems was dealing with the negative effects of post 9/11, but leading Air Transport Systems was a great opportunity. It allowed me to learn the business and then help it grow. What career advice would you give today? Employees should look at what they need to round out their career. Then don’t be afraid to take those opportunities when they’re presented. What makes you confident that our company is well positioned for the future? We have navigated through tough times in the past, and I see nothing in this cycle that we haven’t been through before. And quite frankly, there are a lot of people on our leadership team that also have experienced these cycles before, so we know how to prepare for the upside of the market. As in the last cycle, we always estimate how fast and with how much vigor the market will recover. It usually comes back fast, and it comes back strong. So, we expect to see that same thing again. We just have to have everybody focused on that.

VOLUME 15 > ISSUE 1

9


What’s ahead?

Government Systems

llins Dark Yellow* ANTONE 131 r: C:0 M:30 Y:100 K:10 229 G:168 B:17 (#D39100)

Rockwell Collins Light Blue Spot color: PANTONE 299 Process color: C:80 M:15 Y:0 K:0 RGB color: R:0 G:164 B:224 (#00A0E2)

Maintaining

momentum

llins Dark Green PANTONE 371 or: C:43 M:0 Y:100 K:56 :79 G:111 B:23 (#4A5F1D)

Rockwell Collins Extra Light Blue* Spot color: PANTONE 2915 Process color: C:60 M:5 Y:0 K:0 RGB color: R:77 G:190 B:238 (#63B5E8)

Government Systems focuses on growth in spite of tighteningRockwell defense budgets. Collins Dark Gray

llins Green ANTONE 385 r: C:3 M:0 Y:100 K:58 129 G:124 B:0 (#6F6A12)

U

Spot color: PANTONE Warm Gray 10

color: C:0environment, M:14 Y:28 K:55 nlike the commercialProcess aerospace RGB color: R:138 G:121 B:102 (#7B6E66) fluctuations in defense marketplace conditions typically happen at a much slower and more predictable pace. year, lins Light Green So while 2009 was an economically Rockwellchallenging Collins Gray ANTONE 384 Rockwell Collins’ Government Systems didn’t Spot color:business PANTONE Warm Graysee 8 r: C:18 M:0 Y:100 K:31 Process color: C:0 M:9 Y:16 K:43 radical shifts in its marketplace like our Commercial Systems 159 G:166 B:21 (#8B9000) RGB color: R:161 G:149 B:138 (#92877F) business did. For that reason, in the same period that Commercial Systems revenues fell 21 percent, Government Systems was able to grow its revenues 9 percent. ollins Extra Light Green* “Defense budgets go up, and Rockwell defense budgets go down Collins Light Gray PANTONE 583 and, in most cases, they’re out of Spot color: PANTONE Gray 4 sync with theWarm commercial or: C:23 M:0 Y:100 K:17 Process color: C:0 M:4 Y:9 K:24 vice president Business R:175 G:188 B:31market (#ABB400)segments,” said Scott White, RGB color: R:201 G:193 B:184of (#BDB6B0) Development for Government Systems. “That’s the key thing about having a diversified business – when one marketplace is down, our company is able to minimize the impact.” ollins Dark Blue Traditionally, Government Systems’ Rockwell core Collinsmarket Extra Lightsegments Gray* PANTONE 2955 Spot color: PANTONE Warm Gray 2 have included tanker/transport aircraft, helicopters, fighters/ or: C:100 M:45 Y:0 K:37 Process color: C:0 M:2 Y:5 K:9 bombers/trainers, and weapons. In the last decade, there’s R:0 G:82 B:136 (#003B6F) RGB color: R:233 G:227 B:220 (#D9D5D2) been strong growth in demand for new equipment, spares and retrofits in these core areas – as aging equipment was modernized and in support of the wars in Iraq and Afghanistan. ollins Blue But as we move forward, Government Systems’ leaders don’t Black* PANTONE 300 Spot color: Black that level of spending growth to Process continue. or: C:100 M:40 Y:0expect K:0 Process color: C:0 M:0 Y:0 K:100 R:0 G:125 B:197 (#0068C6) “In the last decade, the U.S. government bought additional RGB color: R:0 G:0 B:0 (#232020) communications and navigation equipment from us to make sure our warfighters in Iraq and Afghanistan were equipped.

> Expanding to sustain growth – Anticipating reductions in defense budgets, Rockwell Collins made the strategic decision to expand its focus beyond traditional airborne markets. Government Systems is concentrating on three adjacent areas – soldier systems, ground vehicles and unmanned aerial systems.

We also saw demand for new capabilities as a result of the wars,” explained Brian Wiebke, director of Strategic Planning and Communication in Government Systems. “Yet as we started looking at future defense spending, we saw changes coming.” According to Wiebke, projections suggest that the budget environment in the United States for Government Systems’ core market areas will be flat over the next few years. In most marketplaces outside of the U.S. – with a few exceptions like India and the Middle East – it’s a similar situation. “We knew that at some point greater pressure was going to be put on defense budgets,” said Greg Churchill, executive vice president and chief operating officer of Government Systems. “And frankly, for that very reason, we made the decision several years ago to strategically move up the value chain and into adjacent markets.” Growing our business Traditionally, Rockwell Collins has been an airborne-centric company. But over the last several years, Government Systems’ focus has been changing in order to maintain growth. In addition to traditional core airborne markets, our Government Systems business is concentrating on three adjacent market areas: ground vehicles, soldier systems and unmanned aerial systems. “In each of these three adjacent market segments, we’re trying to establish a new presence for Rockwell Collins because we believe there are opportunities to grow our business in spite of what is likely a declining budget,” explained Churchill. Already, Rockwell Collins has achieved initial successes in each of these adjacent areas. Last May, the U.S. Army selected Rockwell Collins as the

prime contractor to provide be selected from the phase an integrated video display one competitors to enter system for the engineering the system design and and manufacturing development phase. development phase of the Our company’s team Mounted Soldier System members for the program (MSS) program, which initially include Cubic Defense includes M1 Abrams Main > Supporting existing platforms – The KC-135 Stratotanker – which was Applications, Honeywell, first deployed in 1956 – is a good example of obsolescence that drives Battle Tanks, Bradley Fighting NavCom Technology and Government Systems’ retrofit and upgrade business. To improve safety, Vehicles and M113 Medical Argon ST. operational utility, efficiency and reliability, Rockwell Collins is replacing Evacuation Vehicles. “This is an example of obsolete components with the latest digital avionics technology. In October, our company a program where our core delivered 10 prototype systems for the U.S. Army Ground technical capabilities can be applied,” said Wiebke. “As we look Soldier System (GSS) Increment 1 program. This solution will for opportunities as a systems integrator, we’re being selective significantly enhance soldiers’ effectiveness on the battlefield to pursue those opportunities where our products by improving situational awareness and network capabilities, and technologies give us a competitive advantage.” while minimizing size, weight and power. With the April 2008 acquisition of Athena Technologies, Meeting customers’ needs our company has sold flight control and navigation systems Last April, when U.S. Defense Secretary Robert Gates outlined for a number of unmanned aircraft, including the Shadow, a shift in spending priorities, among the cuts that impacted Watchkeeper, SnowGoose and the Global Observer. Rockwell Collins were the F-22 fighter jet, the Future Combat “The plan is always to capture as much business as you can,” Systems program and the new presidential helicopter. said White. “By further diversifying our addressed markets, But since so much of the U.S. Department of Defense’s we’re able to continue to grow.” inventory is suffering from obsolescence – which is the condition of being or becoming out of date – as some Moving up the value chain opportunities disappear, other funded opportunities are At the same time, our Government Systems business is looking emerging. at ways to do more system and subsystem integration work. “We’re not going to have an F-22, but we’re going to have “At the foundation of everything in Government Systems are an F-35. It will replace F-16s; it will replace F/A-18s ultimately. very strong product positions,” explained Meg Thompson, vice So we will see new platforms come to fruition,” explained president of Strategy Development in Government Systems. Churchill. “The new presidential helicopter got cancelled, but “As a company, we’ll continue to be a product provider, but they’re probably going to update the existing one, so there still we’re also trying to build upon that strong product base are going to be retrofits.” to move up to become more of a subsystems and systems To understand the extent of obsolescence found in the integrator.” Department of Defense’s inventory, just look at the KC-135 Stratotanker, the B-52 bomber and the C-5 military transport aircraft. Right now, the KC-135 is the core refueling capability for the “We knew that at some point greater United States Air Force, and it was first deployed in August of pressure was going to be put on 1956. Plans to replace it with a new tanker exist, but have been delayed. defense budgets.” —Greg Churchill The B-52, now in its sixth decade of service, is expected to remain operational for another 30 years. Likewise, the C-5 entered operational service in 1970, and its service life is One example of this is the Common Range Integrated expected to stretch beyond 2040. Instrumentation System (CRIIS) program, which will replace “It’s our business to meet the needs of our customers, the aging Advanced Range Data System currently in use at whether it’s a new aircraft platform or a used aircraft platform,” major U.S. military test ranges. explained White. “In the near term, we know there are going The U.S. Air Force has selected Rockwell Collins as a to be fewer new platforms, which means more and more of prime contractor for the first of two phases leading to the our business is going to be keeping the existing platforms upgrade of test and evaluation ranges in support of testing operating.” modern platforms. In 2010, a single prime contractor will In October, the U.S. Air Force selected (continued on Page 12)

*This color may be used as a tint or percentage.

10

HORIZONS > 2010

VOLUME 15 > ISSUE 1

11


What’s ahead?

Government Systems

Maintaining momentum (continued) Rockwell Collins for the Engineering, Manufacturing and Development (EMD) phase of the KC-135 Block 45 cockpit upgrade program. Since our company served as the prime contractor for the KC-135 Global Air Traffic Management (GATM) program, this latest contract continues Rockwell Collins’ role in replacing obsolete components with the latest digital avionics technology. “This is a case of where the customer will choose to upgrade airplanes to improve safety, operational utility, efficiency and reliability,” said Wiebke. “This is the type of obsolescence that drives a lot of our retrofit and upgrade business – especially in our tanker/transport and helicopter platforms.” Opportunities outside of the U.S. According to Churchill, many of these near-term retrofit opportunities are not just in the U.S., but worldwide. “A good example is Russian helicopters,” he explained. “There are a lot of countries that have Russian helicopters, and they’re antiquated in their electronics – they’re analog and they need to be brought into the digital age. That’s exactly where we think we have a value proposition, so it’s an opportunity for us to work closely with our International Business organization.” Along with helicopter retrofits, our company is working to bring more Government Systems air, land and sea solutions to markets outside of the U.S. – especially in growing areas like India and the Middle East. “Much of what we already bring to bear in other marketplaces can be offered to these regions,” explained Churchill. “For instance, there’s tremendous opportunity to sell our communications systems in India.” Right now, strong relationships with original equipment manufacturers – like Boeing, British Aerospace (BAE), European Aeronautic Defence and Space Company (EADS), Lockheed Martin, Thales and Raytheon – also are helping us grow our business outside of the U.S. The C-130 Hercules is a perfect example. First deployed by the U.S. Air Force in December 1956, the C-130 is the main tactical airlifter for many military forces worldwide. In working with Lockheed Martin, our company developed a specific cockpit upgrade for the turboprop military transport aircraft. “When Lockheed Martin goes out and presents its capability for other countries to consider, a big component of the package includes Rockwell Collins equipment,” said White. “By having standard positions, when they’re successful in those market segments, we’re also successful.” Looking ahead As Churchill looks forward, he believes our company is in a better position than others to overcome challenges from

12

HORIZONS > 2010

tightening defense budgets. “We have a strong reputation for delivering on our commitments. We have one of the broadest portfolios in the industry,” said Churchill. “We also have very strong strategies in place, and our employees ought to feel good about that. “The other thing to remember is that we’ve got great people,” he continued. “At the core of it all, they know what we need to do – not only for our company, but more importantly, for our customers.”

Q&A with Greg Churchill

G

reg Churchill, executive vice president and chief operating officer of Government Systems for Rockwell Collins, is not one for surprises. That’s why he’s happy to report that many of the changes that are happening in our Government Systems marketplace were anticipated long ago during the business unit’s strategic planning process. Here are excerpts of his conversation: How would you sum up the key focus areas in Government Systems for the next year? We are already a very good execution-oriented organization. We commit to something, and we deliver it. Usually, it’s on time, within the dollars that are afforded to us, and with the quality expectations that come our way. But there are two things that we’re going to continue to focus on. The first is timely orders capture. With the new administration in the U.S., we’re working with new personnel, and that creates challenges for us. We need to do more to make sure we’re filling the funnel with new business. The second is to continue to drive Lean into our culture to try to expand our profitability. If it’s done right, Lean Electronics can help us reduce our costs, get capability to the market sooner, free up bandwidth to do more, and improve quality and predictability. Everybody has to agree that efficiency is a good thing. But to accomplish it, you have to see it in everyone’s behavior and realize it’s not an additive to your job, but fundamentally a part of what your job is. From a strategic standpoint, what is Government Systems doing to make sure the business unit is well positioned for the future? There are three primary things we’re trying to accomplish. The first is just to maintain and preserve our core market segments, which include tanker/transport aircraft, helicopters, fighters/ bombers/trainers, and weapons. Second, we’re trying to move vertically in the value chain to try to provide more of a systems approach and solutions to our customer base. We’ve historically been a product provider, and we’ll continue to be a product provider. But we also know

Photo by John Thomas, Cedar Rapids, Iowa

> Greg Churchill is the there’s more we can offer in systems first to admit that it’s and subsystems integration to our going to get harder for military customers. Government Systems. Third, we’re trying to move into But he believes Rockwell adjacent markets. We’ve largely been Collins is positioned to weather the storm an airborne-oriented company in better than others. both the government and commercial marketplaces. Obviously, the government marketplace offers some adjacent markets that maybe aren’t afforded to the commercial side – like ground vehicles, systems for soldiers and unmanned aerial systems.

Right now, with the declines in the Commercial Systems marketplace, how can Government Systems employees help our company maintain profitable growth in the near term? I believe our way of contributing is pretty simple – we need to do the best we can for our business. Now, more than ever, it’s important that we focus on satisfying our customer, delivering on our commitments, and being innovative with the solutions we provide. I know the pendulum will swing, and there will be a day when we’re not where we want to be, and we’ll be relying on Commercial Systems to help us out. That is the beauty of the balance. We are all part of the enterprise, and nobody buys stock in just Government Systems, or just Commercial Systems; they buy stock in Rockwell Collins. Under the new Obama administration, we’ve already seen some changes in United States defense acquisition. What is your outlook for defense spending over the next five years? I’ll be the first to admit, it’s going to get harder. The budget is going to decline. And so we’ve got to be sharper than we’ve ever been in terms of taking opportunities that come our way. This isn’t a surprise. We’ve anticipated this, and employees ought to feel good that our strategic planning processes, frankly, have positioned us to weather this storm better than others.

Knowing that defense budgets are tightening, can you explain some of the common drivers for our solutions in the Government Systems marketplace? I think there are three huge drivers that are creating opportunities for innovation. First, reducing size, weight, power and cost are paramount. Foot soldiers typically deploy with 70 pounds on their back. So, anything we can do to reduce weight, power consumption and size to make them more agile, is something that they’re just clamoring for. This also is true for the capabilities that go into a weapon, a plane or a helicopter. If the weight of a helicopter is reduced, more weapons or fuel can be carried. The second big thing is networking. It’s all about understanding where I am, where my buddy is, and where the threat is. If we can solve those questions by providing more information via a network, then we’re solving big problems for our warfighters. The last thing is lowering life-cycle costs. For our customers, it’s not just about the development of the widget, it also is about how much the widget costs once it’s in the field. Anything we can do to improve reliability and repairability is huge. How important is it to have a competitive advantage when it comes to cost? Cost is always important in our business. There is no doubt about it. Our customer is consumed with trying to buy more for less, and that will be the case even more so as we look forward, given the budget pressures. But I would also say that our customer is looking for predictability, innovation and quality. One can argue that predictability, innovation and quality are directly related to cost, so we’re attentive of that, but cost is not the only thing that the customer buys on. Customers buy on value, and we have to be mindful of that.

VOLUME 15 > ISSUE 1

13


What’s ahead?

Rockwell Collins Services

llins Dark Yellow* ANTONE 131 r: C:0 M:30 Y:100 K:10 229 G:168 B:17 (#D39100)

Rockwell Collins Light Blue Spot color: PANTONE 299 Process color: C:80 M:15 Y:0 K:0 RGB color: R:0 G:164 B:224 (#00A0E2)

Expanding offerings

llins Dark Green PANTONE 371 or: C:43 M:0 Y:100 K:56 :79 G:111 B:23 (#4A5F1D)

Rockwell Collins Extra Light Blue* Spot color: PANTONE 2915 Process color: C:60 M:5 Y:0 K:0 RGB color: R:77 G:190 B:238 (#63B5E8)

> Growing presence – The Transportable Blackhawk Operations Simulator (T-BOS) is an example of a significant program position in the military simulation and training market segment that supports our customer’s long-term needs.

Rockwell Collins Services has doubled its business in five years.

L

llins Green Rockwell Collins Dark Gray ong before the current economic recession ANTONE 385 Spot color: PANTONE Warmwreaked Gray 10 r: C:3 M:0 Y:100 K:58 Process color: C:0 M:14 Y:28 K:55 havoc on commercial and business aviation, and 129 G:124 B:0 (#6F6A12) RGB color: R:138 G:121 B:102 (#7B6E66)

prior to recent scrutiny of the United States defense budget, senior leaders within Rockwell Collins’ Services business were busy plotting their next major strategic move. model and solid lins Light Green Convinced that a balanced business Rockwell Collins Gray ANTONE 384 growth strategy were keys to continued success, executives Spot color: PANTONE Warm Gray 8 r: C:18 M:0 Y:100began K:31 Process C:0 M:9 Y:16 K:43 focusing on ways to expand thecolor: breadth of service 159 G:166 B:21 (#8B9000) RGB color: R:161 G:149 B:138 (#92877F) offerings and move into adjacent market segments. What they didn’t realize during those post 9/11 strategic planning sessions was how quickly the balanced business successful it would ollins Extra Lightmodel Green* would be tested and how Rockwell Collins Light Gray be. PANTONE 583 “Prior to adding our simulation Spot color: PANTONE solutions Warm Gray 4 and training or: C:23 M:0 Y:100 K:17 Process color: C:0 M:4 Y:9 K:24 portfolio in 2003, about 80 percent of our business was R:175 G:188 B:31 (#ABB400) RGB color: R:201 G:193 B:184 (#BDB6B0) commercial and 20 percent was government,” explained Kent Statler, executive vice president of Rockwell Collins Services. “We’ve worked hard during the past four years to achieve a ollins Dark Blue 50/50 balance, and that’s helped us succeed during a time Rockwell Collins Extra Light Gray* PANTONE 2955 color: PANTONE Warm Gray 2 when so many other companiesSpot have struggled.” or: C:100 M:45 Y:0 K:37 Process color: C:0 M:2 Y:5 K:9 During one of the most severeRGB financial downturns since R:0 G:82 B:136 (#003B6F) color: R:233 G:227 B:220 (#D9D5D2) the 1930s, both Services portfolios – Technical Service Solutions (TSS) and Simulation and Training Solutions (STS) – saw revenues from defense market segments increase. In ollins Blue fact, the TSS portfolio recorded 13 percent year-over-year Black* PANTONE 300 Spot color: Process growth in FY’09, while STS grew year over yearBlack by 32 percent. or: C:100 M:40 Y:0 K:0 Process color: C:0 M:0 Y:0 K:100 According to Statler, this growth in the government R:0 G:125 B:197 (#0068C6) RGB color: R:0 G:0 B:0 (#232020) marketplace helped offset a decline in commercial revenues

as the air transport and business jet market segments tightened due to the economic crisis. “If you look at our business as a whole, we reported yearover-year growth of $59 million, or 7 percent,” said Statler. “I’m convinced that FY’10 will be a benchmark year if we continue building upon our FY’09 successes.” Boosting business If the success experienced in recent years is any indication, Statler is probably right. In the past five years, Services has doubled its business, growing to more than $1 billion in sales in FY’09. Despite continuing economic challenges and market segments that are growing at only 2 percent, leaders are still anticipating significant growth over the next five years. “We have some really exciting things mapped out in both our TSS and STS portfolios,” said Scott Gunnufson, vice president of marketing and strategy. Several initiatives may help drive growth and propel Services to a business with more than $1.7 billion in sales by FY’14. The initiatives include the expansion of international logistics to support maintenance, the expansion of capabilities in the Engineering Services organization, the development of military simulation as a provider of integrated solutions for the entire training curriculum, and the growth of simulation and training into adjacent market segments.

Growing maintenance, logistic expertise. repair and overhaul “A lot of our business with With service centers and the government is based customers located around on the operational tempo the world, Rockwell Collins of our currently deployed is already well known for equipment,” explained Ken its traditional maintenance, Estelle, vice president and repair and overhaul (MRO) general manager of TSS. expertise and rental exchange “Engineering Services allows programs. us to provide more than In FY’10, Services plans traditional maintenance, repair > New positions – The June 2009 acquisition of the former DataPath/SWE-DISH expands Rockwell Collins’ life-cycle services to implement additional and overhaul. We also can in platform- and system-level logistics for the military. logistics capabilities such address system obsolescence as enhanced Web resources as well as logistic and technical to improve the customer support for legacy products or experience and to support MRO services in both commercial programs where we see diminishing material availability.” and government market segments. According to Estelle, Services hasn’t traditionally played Today, many airlines are cash constrained, so they aren’t a large role in platform- or system-level logistics for the managing their own repairs. Instead, they’re shifting this work military, but the June 2009 acquisition of the former to external suppliers like Rockwell Collins and are redirecting DataPath/SWE-DISH expands our life-cycle services capital to purchase new aircraft and update facilities. in these areas. “Customer needs are changing and we’ve worked very hard FY’10 also will see Services take its core support and to set up a global system that enables spares ownership, expanded capabilities into the new market segments that maintenance, repair and overhaul and logistics services Government Systems is entering such as soldier systems, managed by Rockwell Collins,” said Gunnufson. “In essence, ground vehicles and unmanned aerial systems. Additionally, we’re providing a more comprehensive service package than Services is pursuing several public-private partnerships – what was offered in the past.” commonly referred to as depot activations – in which Rockwell Singapore Airlines is a prime example of this success. In Collins works directly with the government to test and August 2007, Singapore Airlines signed a Dispatch 100SM maintain equipment. service contract with Rockwell Collins for its fleet of 19 A380s. Additionally, Airbus selected our company to provide the dispatch program for Singapore Airlines to maintain its future “We’re using Rockwell Collins’ fleet of 19 leased A330 aircraft. expanded capabilities to go places “Singapore Airlines selected this solution because it will help them maximize the efficiency of their operation,” said we haven’t gone before.” Gunnufson. “These are examples of how airlines and original —Ken Estelle equipment manufacturers are reshaping the industry. Both air transport and business and regional jet customers are now asking for this type of service.” One of the more significant steps toward future growth in this Extending Engineering Services area was the January 2009 depot activation contract awarded While continued focus on core MRO market segments and to Rockwell Collins by Lockheed Martin for test capability, strong program execution account for about 40 percent of training and integration support for F-22 avionics at Warner Services’ anticipated growth in FY’10, an additional 20 percent Robins Air Logistics Center. This 32-month contract elevates our will likely come from expansion of our government support company’s relationship with Warner Robins and brings together offerings. the capabilities of Rockwell Collins, Lockheed Martin and the Faced with increased mission requirements and tightened U.S. Air Force. operational budgets, military leaders around the world are “We’re using Rockwell Collins’ expanded capabilities to go in need of support for systems that are being used far longer places we haven’t gone before, and that’s really exciting,” than originally anticipated. As a result, Services recently said Estelle. “We’ve been through a tough year, but we’re expanded Engineering Services, an organization that enhances positioning ourselves for growth with some fantastic ideas and (continued on Page 16) system life-cycle support through field service engineering and new opportunities.”

*This color may be used as a tint or percentage.

14

HORIZONS > 2010

VOLUME 15 > ISSUE 1

15


What’s ahead?

Rockwell Collins Services

Expanding offerings (continued) Developing simulation and training solutions During the past decade, our presence in the simulation and training marketplace has grown substantially. Through our own research and development investments and several acquisitions – including NLX in 2003, Evans & Sutherland’s visual systems business in 2006, and SEOS in 2008 – our company has become one of the aerospace and defense industry’s top simulation and training providers. In FY’10, leaders expect that growth to continue. In fact, 40 percent of Services’ anticipated growth during this fiscal year may come from ensuring military simulation solutions span the entire training curriculum, and expanding into adjacent market segments like ground training. According to Ken Schreder, vice president and general manager of STS, there’s about $9 billion spent worldwide on military simulation and training each year. The U.S. government spends about half that amount, and tightening U.S. defense budget pressures mean STS is focused on finding ways to help the government decrease costs. “In the past, STS worried only about a couple pieces of the entire training curriculum – full flight simulators and mission trainers,” said Schreder. “But the environment in simulation and training has become so complex that it’s important for our customers to have a company that understands the entire training continuum. Therefore, our focus has been on expanding our capabilities along that training continuum.” Leaders also will focus in FY’10 on balancing the STS business, which is currently far more focused on the military. “Eighty-five percent of our business today is military, so we weren’t really affected much when the commercial marketplace went sour,” explained Schreder. “Going forward, we need to create a business that’s diverse enough to handle the ebbs and flows of the marketplace.” With the June 2009 launch of our new CORETM simulation architecture, Schreder believes the pendulum soon will begin to shift. CORE simulation architecture provides customers with a highly configurable tool suite in order to customize training. It also fully integrates our visual systems, visual databases and display technology. The Boeing 737 NG full flight simulator, which uses the CORE simulation architecture, recently received certification from the United Kingdom Civil Aviation Authority. This achievement provides our company with additional credibility in the marketplace and opens the door to future commercial business. “We didn’t invest in our CORE simulation architecture with the intent of capturing just today’s configuration of aircraft,” explained Schreder. “We did it to prepare us for the introduction of the next generation of commercial aircraft like the Airbus A350 and future narrowbodies.” 16

HORIZONS > 2010

Looking ahead With a solid foundation and growth framework in place, Statler believes Services has what it takes to stay ahead of the competition in FY’10 and beyond. “I’m excited about what’s ahead, and I can’t wait to see what we’ll achieve together,” he said.

Q&A with Kent Statler

S

ince taking the reins as executive vice president of Rockwell Collins Services in October 2005, Kent Statler has witnessed tremendous change within his organization and in the way it supports both commercial and government customers. Despite a challenging FY’09, Statler is excited about the future. In fact, he believes his business only has touched the surface of what it can accomplish in the years ahead. Here are excerpts of his conversation: Services works with both Commercial Systems and Government Systems. How is your business structured to support these businesses? Services provides total life-cycle solutions for commercial and military customers worldwide, and we do so through two business portfolios. Technical Service Solutions offers service and support including maintenance services, material management and asset solutions, as well as field service engineering and logistics management. Simulation and Training Solutions delivers advanced simulation and training solutions, including comprehensive, cutting-edge training and systems development and operations support. How has the recession and its effect on our commercial customers impacted Services, and what do you consider when planning for the future? During a recession, we see a tremendous decline in flight hours, aircraft use, fleet mix and the ability of our customers to invest in the aftermarket. As the economy improves and passenger traffic returns, airlines will begin filling out their route structures and flying more flights, which leads to increased hours on equipment and an increase in basic repair and maintenance services. There are several factors that help us to understand what’s happening in the commercial marketplace. One of the leading indicators is how many aircraft are being temporarily taken out of service and parked because of a decrease in demand. Since the beginning of 2007, we’ve seen about 800 aircraft grounded

Photo by John Thomas, Cedar Rapids, Iowa

and we expect to see another 250 parked in 2010. That means fewer aircraft are driving demand for our maintenance services or spare part sales. We expect the number of parked aircraft to remain at this level for FY’10. We also pay close attention to how many flight hours are being logged each month because the more an airplane flies, the more it needs to be serviced. For example, airlines in the early part of 2008 were flying each airplane an average of 240 to 245 hours per month. In 2009, that number dropped to between 215 and 220 hours per month, which equated to a decrease in our business. We expect use of the aircraft currently in service to make a slight improvement in FY’10 as the economy rebounds and traffic demand gets stronger. Are factors the same when it comes to the business jet market? The most significant driver in terms of service and support activity in the business jet market segment is rental exchange, which is basically a quick exchange of a defective part versus repair of that part. When flight activity is lower, that means fewer exchanges, which leads to less revenue. To gauge this particular market, we look at monthly takeoffs and landings. In a normal year, we’d see between 240,000 and 245,000 takeoffs and landings per month. In 2009, we saw that number drop to between 180,000 and 190,000. But we’ve seen some stabilization in activity levels in recent months, and we’re expecting things to remain about the same in FY’10. Tightening U.S. defense budgets, program delays and cancellations, and a shift in U.S. defense spending priorities are anticipated in the coming years. What does this mean for Services? Shrinking U.S. defense budgets mean we need to pay extra close attention to how we’re positioning our business for future growth. A lot of our government services business is affected by operational pace and the use of currently deployed equipment.

Many of our parts already have been in service much longer than originally planned, and when budgets shrink and new programs are delayed or cancelled, those old parts will need to remain in service. So, the government needs to find ways to keep those parts functioning long after they’ve become obsolete, and that’s one of our areas of expertise. We also need to help the government find ways to get more out of the money it spends, and we can do that in a variety of ways such as managing repairs and providing total life-cycle solutions. > Kent Statler stresses the importance of staying focused on the customer and doing what we say we’re going to do.

As Rockwell Collins re-energizes its focus on Lean Electronics, how does your organization plan to accelerate the use of Lean? We believe Lean will be re-energized and accelerated through our leaders, who are immersing themselves, and teaching and leading Lean in all areas of our business. We’ve established clear expectations for all Rockwell Collins Services leaders, including teaching, cadencing, communicating and continued learning of Lean. We’ve identified 34 people devoted to improving the use of Lean across our business. We’ve also established a Lean Council that will share best practices, disseminate information, address questions regarding Lean deployment, and advance the state of Lean across our organization. You are often heard saying, “Keep your eyes on the customer.” Why is this so important? I have a never-ending passion for meeting customer needs, and I want our employees to understand how important it is to always focus on our customers. Our company would not be a success without the customers and shareowners that continually place their trust in us. So, it’s very important that we stay focused and do what we say we’re going to do. In the end, that will help position our company for continued growth in all economic conditions. <h>

VOLUME 15 > ISSUE 1

17


llins Dark Yellow* ANTONE 131 r: C:0 M:30 Y:100 K:10 229 G:168 B:17 (#D39100)

Rockwell Collins Light Blue Spot color: PANTONE 299 Process color: C:80 M:15 Y:0 K:0 RGB color: R:0 G:164 B:224 (#00A0E2)

Rockwell Collins Extra Light Blue* Spot color: PANTONE 2915 Process color: C:60 M:5 Y:0 K:0 RGB color: R:77 G:190 B:238 (#63B5E8)

llins Dark Green PANTONE 371 or: C:43 M:0 Y:100 K:56 :79 G:111 B:23 (#4A5F1D)

Staying on course

llins Green ANTONE 385 r: C:3 M:0 Y:100 K:58 129 G:124 B:0 (#6F6A12)

Rockwell Collins Dark Gray Spot color: PANTONE Warm Gray 10 Process color: C:0 M:14 Y:28 K:55 RGB color: R:138 G:121 B:102 (#7B6E66)

llins Light Green ANTONE 384 r: C:18 M:0 Y:100 K:31 159 G:166 B:21 (#8B9000)

Rockwell Collins Gray Spot color: PANTONE Warm Gray 8 Process color: C:0 M:9 Y:16 K:43 RGB color: R:161 G:149 B:138 (#92877F)

Lean ElectronicsSM helps Rockwell Collins remain competitive.

A

relay team’s competitive edge is based on the unique contributions of each member.

ollins Extra Light Green* PANTONE 583 or: C:23 M:0 Y:100 K:17 R:175 G:188 B:31 (#ABB400)

Rockwell Collins Light Gray To be the best, team members have to identify how they can shave another second off Spot color: PANTONE Warm Gray 4 Process color: C:0 M:4 Y:9 K:24

RGBor color: R:201 G:193 (#BDB6B0)handoff to the next runner. This is exactly what of their time ensure aB:184 smooth

Rockwell Collins is doing with Lean Electronics . SM

ollins Dark Blue Rockwell Collins Extra Light Gray* PANTONE 2955 Spot color: PANTONE Warm Gray 2of the external market “When we talk about Lean, we’re regardless or: C:100 M:45 Y:0 K:37 Process color: C:0 M:2 Y:5 K:9 simply talking about continuousRGB color: R:233 G:227 conditions.” R:0 G:82 B:136 (#003B6F) B:220 (#D9D5D2)

improvement,” said Jon Kounkel, First introduced at Rockwell Collins manager of Lean and Six Sigma for in the late 1990s as a way to improve Rockwell Collins. “By encouraging quality and performance, Lean ollins Blue employees to apply Lean methods and Electronics – also known as Lean – is Black* PANTONE 300 Spot Black tools cancolor: Processour enterprise philosophy for how we or: C:100 M:40 Y:0 K:0 to their daily activities, we Process color: C:0 M:0 Y:0 K:100 R:0 G:125 B:197 (#0068C6) continue to reduce costs and increase run our business in order to create RGB color: R:0 G:0 B:0 (#232020) customer satisfaction. This helps us win superior customer value and financial more business and remain competitive performance.

Learn more Employees are encouraged to visit the Lean Electronics Web page via “L” in the Rockwell Collins Online Index to access additional information about our Lean journey, resources, certification and training.

Taking action Last year, as senior leaders began to see signs of a slowing economy, they knew that we needed to re-energize Lean to improve our overall efficiencies. To take advantage of every opportunity to shorten development cycle times, improve quality and on-time delivery, and enhance product functionality, they decided to elevate Lean Electronics to an enterprise shared service organization. Robin Corwin, formerly an engineering director for Flight Deck Applications, is now the director of Lean Electronics for Rockwell Collins, reporting to Clay Jones, chairman, president and chief executive officer. As a leader, Corwin frequently engaged employees in root-cause problem solving, critical thinking and continuous learning, which are essential elements of Lean. “It’s important to encourage and equip employees to solve problems rather than just giving them the answers,” said Corwin. “This allows employees to brainstorm solutions outside of the way it has always been done and take ownership in driving results. That’s really what Lean is all about – looking at a given problem or process, identifying opportunities for improvement, and initiating change. “Our goal is for all employees – regardless of what organization they work in or what jobs they perform – to realize that they can apply Lean tools to everything they do,” she continued. Enterprise-wide focus To create a work environment that encourages continuous improvement, executive leaders are sponsoring four enterprise-wide initiatives. While our business units and shared services also have identified more specific Lean goals and actions, these initiatives were specifically selected to help our company refine and emphasize the Lean philosophy that Rockwell Collins has rallied around for more than 10 years. “We recognize the value in maintaining an environment where Lean tools and thinking are a way of life throughout our company,” said Corwin. “So, with these initiatives, we’re striving to drive and sustain that kind of focus.” <h>

Rockwell Collins’ four areas of Lean focus:

1

Re-energize Lean Electronics Sponsor: Kent Statler, executive vice president of Rockwell Collins Services To position Rockwell Collins for long-term success, we must engage every employee in the practical, day-to-day application of Lean. This initiative will reinforce clear expectations, provide meaningful education opportunities, and promote ongoing awareness to ensure continuous improvement is always top of mind.

Refresh Life Cycle Value Stream Management (LCVSM) process

2 3 4

Sponsors: Greg Churchill, executive vice president and chief operating officer of Government Systems, and Kelly Ortberg, executive vice president and chief operating officer of Commercial Systems Rockwell Collins’ Life Cycle Value Stream Management (LCVSM) process enables our company to make smart decisions about our portfolio of products, systems and services. This initiative will ensure employees understand the value of the LCVSM model, as well as clarify roles and responsibilities within the model to improve business performance.

Update processes for selecting, on-boarding and developing first-time leaders Sponsor: Ron Kirchenbauer, senior vice president of Human Resources Effective leadership is critical to the success of our company. This initiative will build upon the development opportunities available through the School of Leadership to improve the efficiency of how we prepare and equip new entry-level leaders at Rockwell Collins.

Ensure goals are aligned Sponsors: Nan Mattai, senior vice president of Engineering and Technology, and Jeff Moore, senior vice president of Operations As an enterprise, we need to make certain that the specific goals and objectives for each business and shared service are aligned appropriately to drive success. This initiative will ensure that improvement in one process or organization does not adversely affect another.

*This color may be used as a tint or percentage.

18

HORIZONS > 2010

VOLUME 15 > ISSUE 1

19


Rockwell Collins service anniversaries Rockwell Collins offers congratulations to employees who have marked significant service award milestones in recent months. 45 years September Joyce A. Bohlken October Karen K. Arp Wanda E. Hansel > Exceptional performance – Working side-by-side, Rockwell Collins is helping Hawker Beechcraft advance aircraft, such as the Hawker 900XP.

llins Dark Yellow* ANTONE 131 r: C:0 M:30 Y:100 K:10 229 G:168 B:17 (#D39100)

A unique relationship Rockwell Collins Extra Light Blue* Spot color: PANTONE 2915 Process color: C:60 M:5 Y:0 K:0 those types of actions that RGB color: R:77 G:190It’s B:238 (#63B5E8)

set a Rockwell Collins is supplier apart and make them deserving Hawker Beechcraft’s of this award.” Supplier of the Year. Rockwell Collins Dark Gray

llins Green ANTONE 385 r: C:3 M:0 Y:100 K:58 129 G:124 B:0 (#6F6A12) By Marielle Rodeheffer

I

Working together

Spot color: PANTONE Warm Gray 10 From flight deck and cabin solutions to Process color: C:0 M:14 Y:28 K:55 electromechanical systems, nearly every RGB color: R:138 G:121 B:102 (#7B6E66)

HBC aircraft that rolls off the production line contains Rockwell Collins content. n today’s tough economic According to Tim Rayl, senior director environment, it’s more important llins Light Green Rockwell Collins Gray of business and regional systems sales than ever to foster relationships ANTONE 384 Spot color: PANTONE Warm Gray 8 for our company, Rockwell Collins and with our customers. That’s why r: C:18 M:0 Y:100 K:31 Process color: C:0 M:9 Y:16 K:43 159 G:166 B:21 (#8B9000) HBCB:138 employees’ receiving Hawker Beechcraft RGB color: R:161 G:149 (#92877F) close relationships over the past four decades have made Corporation’s (HBC) Supplier of the Year award is so significant; it’s a key indicator a difference in the way the companies work together to solve problems and of a well-maintained affiliation. ollins Extra Light Green* Rockwell Collins Light Gray develop new solutions. that PANTONE 583 “Rockwell Collins is the supplier Spot color: PANTONE Warm Gray 4 “HBC had HBC this or: C:23 M:0 Y:100 K:17the most positive effect on Process color: C:0 M:4 Y:9 K:24recognizes the value in having us R:175 G:188 B:31year,” (#ABB400) color: R:201 G:193 B:184 (#BDB6B0) more involved and giving us privileged said Jeff Blose, director of RGB supply insight into their company’s plans,” said chain sourcing materials and logistics Rayl. “That alone speaks to the unique at HBC. “Your company truly sets itself relationship we have; winning this apart.” ollins Dark Blue Rockwell Collins Extra Light Gray* award simply underscores the fact that PANTONE 2955 In response to the economic Spot color: PANTONE Warm Gray 2 or: C:100 M:45 Y:0 K:37 weY:5 build downturn, HBC – our company’sProcess largest color: C:0 M:2 K:9 trust with our customers every R:0 G:82 B:136 (#003B6F) RGB color: B:220 (#D9D5D2) day.” business jet customer – was forced to R:233 G:227 make difficult manufacturing-related Recognized for performance decisions. An annual program, the HBC Supplier “Because of reduced production, ollins Blue Black* Awards recognize the company’s top PANTONE 300 we didn’t have the need for as much Spot color: Process Black or: C:100 M:40 Y:0 K:0 in five categories: Supplier of inventory,” said Blose, who handles our Process color: C:0 vendors M:0 Y:0 K:100 R:0 G:125 B:197 (#0068C6) RGB color: R:0 G:0the B:0 (#232020) Year, Performance Champion, Small company’s account at HBC. “Rockwell Collins was flexible, changed with us and Business Partners Award, Innovative Excellence and Customer Service didn’t force any unnecessary inventory.

December Patricia J. Fox January Vernon W. Hootman

Rockwell Collins Light Blue Spot color: PANTONE 299 Process color: C:80 M:15 Y:0 K:0 RGB color: R:0 G:164 B:224 (#00A0E2)

llins Dark Green PANTONE 371 or: C:43 M:0 Y:100 K:56 :79 G:111 B:23 (#4A5F1D)

November Patricia A. Frasher Richard A. Martens

Champion. Last year, our company clinched the Innovative Excellence award. According to Blose, consistently delivering a high level of performance is the most critical factor HBC considers when selecting a winner for the Supplier of the Year award. The company also considers system integration, cost contributions, process improvements, on-time deliveries and product quality. “We are responsive, we are committed, we own our issues, and we are flexible,” said Nic Jaeger, director of business and regional systems customer support for Rockwell Collins. “If necessary, we’ll travel to our customers to provide that level of support.” Paul Clark, a principal account manager for Rockwell Collins, who works on site at HBC in Wichita, Kan., agrees. “On a daily basis, the team is proving to our customer that we are a trusted partner,” said Clark. And, in the future, we expect the relationship between our company and HBC will only grow and develop, ensuring our mutual success as the economy makes its inevitable recovery. “We are in this with your company [Rockwell Collins] for the long haul,” said Blose. “HBC has an exciting future bringing your systems into our aircraft. It will help our business jets stand above the competition as we go to market together.” <h>

40 years September Norman W. Blades Robert Elfner Georg Fecher Jeanne K. Gritton Ellin K. Gruber Kevin E. Meyer Michael Nitsche Hans-Dietmar Richter November Jack R. Harris Sandra J. Mc Neal December Ana Elsa Fernandez William L. Overstreet 35 years September Virginia L. Burns Rebecca S. Cook Donna R. Davis Alan R. Erickson Mark W. Gibbs Richard A. Groshong Gary L. Harrington Nancy L. Hayes Inam A. Khan George L. Lovato Kerry L. Luchauer David W. Lutter Kim F. Martelle Casey W. Orr Christine M. Perez Linda K. Smith L.A. Smith Robert J. Ward Terry W. Whigham James T. Williams

October Lyal H. Bauer David E. Eicher Hans Itte Mary M. Johnson Richard A. Monahan Susan A. Porter Irma Dolores Salazar Escalante Karl K. Strempke November Victoria Gerardo Bernal Curtis D. Lindsted I. J. Pasker Danny J. White December B. Bryan Annie B. Dean Don L. Landt Paul F. Recore Charlotte A. Seegers January Peggy L. Brake Karen F. Brown Patricia Espinoza Herrera Andreas Haubrich Janie L. Holladay Daniel Houghkirk Michael J. Kach Geraldine K. Thompson Debbi L. Washburn John M. Williams 30 years September C. Adams Philip D. Brown Brenda A. Burns Marguerite E. Carman Dan J. Claflin Jack A. Colon Cheryl A. Cook Roger D. Eller Stephen G. Fuemmeler Ricky L. Fulbright Douglas J. Heslinga Robin M. House Jacquelyn S. Kuennen Nancy A. Lehman Charles K. Masko Michelle P. Matheny Scott R. Murphy Dennis R. Nebraska Marion A. Payne Jr Gloria G. Perez

Dirk D. Punzelt Johnie S. Roberts Jr Stephanie L. Ronald Rhonda S. Ryan Elizabeth M. Sandstrom Michael A. Scanes Kathy M. Smith Linda S. Snow-Solum Jesse L. Thedford Robert L. Whitfield Denise K. Zakostelecky October Daniel S. Allen Jayne A. Burnham Dennis D. Cobb Alice A. Counts Robyn L. Courtney Timothy A. Decook Gary L. Finney Roger M. Gambrel Pamela M. Gorden Douglas J. Hanson Robert Harline Jack T. Harville Walter H. Hewett Myrel F. Hodge Jr Thomas E. Hora Steven W. Johnson Dianne R. Kamp Paul D. Little Michael T. Meadows Marcella A. Miller Janice A. Monson Gregory L. Morud Cheryl A. Murray Vuong T. Nguyen Carl F. Novak Calvin S. Ortgies George T. Reid Patricia M. Roney Donna M. Sauer Thomas M. Sohner Daniel J. Stachowiak Janice K. Trenary Mario R. Vasquez Joel H. Walker George T. Ward Larry D. Witmer Scott A. Zebuhr November J. W. Allen Charles R. Badanguio Louann M. Bucheit Glenn A. Crouch Patricia Gernenz Margaret E. Hardman Tammy J. Harris Michelle D. Hinderks Sharla M. Janechek George A. Krug Jr

Mary A. Lagerquist Dennis L. Manson Joe G. Molitor Steven R. Mrkvicka Lisa M. Nielsen David D. O’Brien Sara J. Onsager Boon Phuthama Harold D. Raynor Georgana L. Ridnour Richard A. Smejkal David M. Sulentic Francisco A. Villarreal Bonita C. Williams Sellers Robert B. Wood Robin K. Zweibahmer December Duane L. Beaudry Dale N. Bradshaw Jean A. Coons Steven M. Freese Marianne A. Huinker Ted D. Jillson Clayton M. Jones Patricia A. Lipscomb Mary M. Little Brian L. Pospichal Robert B. Ray Bret W. Spars Patricia R. Tussler January Shari L. Burns Rita R. Campbell Bruce M. Canady III Michael P. Conley Philip J. Conn Ly H. Dinh Daniel C. Forseth Kelly B. Griffin Ronda R. Hampshire Tony L. Herdman Sandra L. Johnson Sharla M. Landers Shanutel Minor Mylinh T. Nguyen Cynthia A. Parmer Lucy L. Ponte Stephen A. Ward 25 years September Brian T. Azelborn Michael J. Buck James A. Conklin William J. Dobson Frances C. Gomez Helge Uwe Henning Craig B. Ivie Annette M. Kuelper

Rodney N. Larson Thomas Lauer Cindy L. Maring Kary D. Miller John W. Nirschl Teresa R. Ochs Jolene M. Parsons Carl G. Shaffer Jr Dorothy T. Usher Clyde M. Watkins Mark E. Whiting October Alan D. Campbell Terry L. Eaton Margaret S. Garrahan Kelly S. Gorkow Stephen R. Johnson Reynaldo M. Juco Tom A. Maruko Jeffrey K. Matheny Rex A. Morgan Marla J. Myers Tony T. Nguyen Bradley V. Quick Javier H. Raigoza Ellen M. Reid Joel D. Royer Kathleen A. Sharp Todd W. Toll Mark E. White Kenneth G. Woo November Blake A. Andrews Michael L. Bell Nicolas D. Bricker Robert D. Heath William M. Klein Graham KnightWhiddett Christopher A. Martinez George D. McDearmid Jorge A. Mercado Bradley A. Messing Clifford H. Middleton Gary W. Patton Lana M. Poole Dominic Quintana Randal L. Smith William L. Stolte Phil N. Thai Ramona I. Tuttle

Richard C. Mell Cheryl L. Nelson Robert A. Newgard James D. Sampica Terri L. Schade James L. Scheer Robert A. Schutte Kristi K. Sulentic Robert M. Wolff Jr Gregory P. Wolph James R. Wooldridge Mark R. Zimmerman January Robert A. Abbott Mark J. Auge John G. Bendickson Karin Berberich Steven J. Boerhave Stephen L. Brandt Randal L. Bures David S. Day Raleigh R. Dean Timothy J. Duffy Gregory D. Gerdes Betty G. Hager David A. Haverkamp Linda A. Hegland Elaine K. Heitkamp Robert W. Hinrichs Wesley C. Hokanson Boyd L. Kaiser Keith E. Kankelfitz Konstantin A. Katsiris Daniel W. Kellen Kevin C. Krych Frank C. Kubovec Erick Le Gall David V. Mager Eduardo Malamut Nancy K. Marsh Paul J. Pecchia Robert L. Perkins Joan A. Ransom Janice E. Reames James C. Rohling Terrence L. Schmitt Lyn E. Shannahan Anthony D. Stabile David L. Taylor Claudia Toedte Heinz Wagner Dwight A. Walker Sidney S. Ying

December Jean A. Clarke Wanda K. Corkery Rochelle E. Enderton Jody R. Faust Dieter Frank Martin A. Gunther Joette K. Lutz

Web extra: Rockwell Collins employees celebrating 20 years of service or less are recognized in Horizons online at www.rockwellcollins.com/horizons.

*This color may be used as a tint or percentage.

20

HORIZONS > 2010

VOLUME 15 > ISSUE 1

21


PRSTD STD US Postage PAID Cedar Rapids, IA Permit No. 90

Rockwell Collins, Inc. 400 Collins Road NE Cedar Rapids, Iowa 52498-0001 Return Service Requested

Facility spotlight: Heidelberg, Germany By Marielle Rodeheffer

R

ockwell Collins’ facility in Heidelberg, Germany, is the hub for several of our European Government Systems programs, including the Eurofighter Typhoon and Sikorsky CH-53G medium-lift transport helicopter. Housed in six buildings that span 170,000 square feet, about 500 employees support engineering, manufacturing and service functions. According to Dr. Artur Redeker, managing director in Heidelberg, having a German facility with a full range of capabilities for government contracts is vital for success in European market segments. “When it comes to the aerospace and defense industries here, a strong local presence is a determining factor,” said Redeker. “If you aren’t present in Europe with capabilities that go beyond selling products, you aren’t accepted as a real player, and you have little credibility.” And while customers in Germany appreciate the benefits of a local facility, employees still can access the advantages and assets of a large, global organization. “We understand what drives our European customers and are able to foster those relationships because of our proximity,” said Redeker, who joined Rockwell Collins in 2006, “but we still can call on any of our locations throughout the world. For example, we share a lot of resources with our colleagues in France.” Leading supplier of space wheels Shortly after our 2005 acquisition of TELDIX GmbH – a company that started providing military aviation electronics products and

services in Germany in 1960 – the facility in Heidelberg became the central site for all of our company’s business in Germany. “TELDIX had local ties Photo by Armin Goeckel, Heidelberg, Germany and relationships in the > Eveline Dittmann, solderer at our facility in Heidelberg, fuses small European aerospace parts on a circuit board for a Eurofighter Head-Up Display. industry that coincided with our company’s growth plans in Europe,” said Redeker. “So, it was a good opportunity Combined capabilities bring new wins for Rockwell Collins to make a valuable More recent successes – such as the acquisition.” CH53-G program win – have come about by Today, some of the products being combining capabilities under the Rockwell produced in Heidelberg have a long history. Collins brand. Customizable mission computers for “A lot of contracts we’ve been able to European aircraft programs were first win since 2005 were a direct result of developed more than three decades ago. At the acquisition, which provided name present, about 60 percent of the facility’s recognition, instant customer trust and sales are from the mission computers, credibility in European market segments,” which can be found on aircraft like the Tiger said Redeker. “Between 2008 and 2010, we helicopter, Tornado and Eurofighter. expect our facility in Heidelberg to have “A total of 40 to 50 Eurofighters are grown about 30 percent.” delivered every year to several European According to Armin Goeckel, manager of militaries,” said Dr. Oliver Stucky, director of public relations in Heidelberg, the CH-53G Eurofighter programs. “That’s about 300 of contract win is helping to expand business our mission computers per year.” in Heidelberg, especially when it comes to Additionally, the TELDIX® Space Wheels, solutions for helicopters. high-precision mechanisms that keep the “The success of the CH-53G program orientation of a satellite constant, have has accelerated our goal of becoming more been in production since the late 1960s. established in Germany and throughout More than 875 space wheels – of which Europe,” said Goeckel. “I expect that growth 487 are still active – have been placed on to continue well into the future.” <h> 326 satellites and launched into orbit. “Only a few companies worldwide This article may contain forward-looking statements including statements about the company’s business prospects. Actual offer a product like the space wheel,” said results may differ materially from those projected as a result of Wolfgang Kupferschmitt, director of Space certain risks and uncertainties, including but not limited to those detailed from time to time in our earnings press releases and Products. “It’s a good niche market to be Securities and Exchange Commission filings. involved in.”


HorizonsVol15Issue1