Welcome []/media/Files/Unsecure/News and... · Phil Jasper Executive Vice ... © 2014 Rockwell Collins. Proprietary All rights reserved. Information What you do matters 21 ... Remember,

© 2014 Rockwell Collins. All rights reserved.

Proprietary Information


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Welcome Tuesday, March 4, 2014 Cedar Rapids Convention Complex




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Rockwell Collins Supply Chain Kevin Myers Vice President Material & Supply

2014 Annual Supplier Conference





Celebrating success

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The supply base of 2020

• 5X global presence

• 50% less complex supply chain

• 4X improvement in performance levels

• 100% new program supplier selection with Silver Select or higher performance suppliers

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Accelerating supply chain transformation

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Simplifying our supply

chain

Raising performance

Enabling growth



Average lead time is 205 days

>700 daily flow interruptions

Redundant processes and roles across

organizations

300k supplier receipts

100k internal moves

2,900 active suppliers

Treat all customers with same priority

< 50% of PO transactions automated

Simplifying our supply chain Understanding the complexities

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>1,700 portal changes per day

700 make up >90% of our total spend

10% of CS customers and 5% of GS customers

drive 80% of sales

>1,500 faxed changes per day

Every interruption = a phone call

25% expedited

34 buyers call 1 supplier



Transformational solutions Supplier Value Add Partnership (SVAP)

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Current GLU Chassis Future

203 Parts 1 kit

137 # of lot sizes utilized 1

12% consignment Replenishment approach 100% Kanban

3/week Flow inhibitors 0/week

17 Suppliers 1

15 Underperformers 0



Raising performance

• Attain Platinum Premier status

– 0 DPPM for component suppliers

– <1,000 DPPM for subcontract suppliers

– 99.9 – 100% on-time delivery

– Green in all 3 business alignment categories

• Proactively adopt new requirements

– Third-party certified Quality Management System

– Nadcap accreditation of special processes

– Materials declaration compliance

– Only use franchised distributors

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Enabling growth

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Stay business aligned

Evolve product and service capabilities

Deliver innovative solutions

Be globally minded

Be positioned to support our global needs

Share business plans involving global capabilities

Be performance focused

Attain Platinum Premier status

Improve quality and on-time delivery 20% yearly

Proactively adopt new requirements



Accelerating supply chain transformation

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Voice of our customer: Airbus Helicopter

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Building Our Global Network Colin Mahoney Senior Vice President International & Service Solutions




Building our global network

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How the supply base can help



International markets … the numbers

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4% Addressed international market growth

Total direct int’l sales over next 5 years

~50% Percentage direct int’l

business by 2019

$1B

Offset obligations by 2018

~$11B



International addressed markets

($B)

$0

$2

$4

$6

$8

$10

$12

$14

$16

2013 2014 2015 2016 2017 2018

Emerging Countries

Developed Countries

CAGR 4%

6%

2%

Rockwell Collins International Addressed Market

Int’l Addressed Market by Region

Americas

APAC

EuMEA

CAGR 6%

7% 6%

CAGR 5%

6%

3%

CAGR 3%

5%

2%

($B)

$0

$2

$4

$6

$8

2013 2014 2015 2016 2017 2018

$0

$2

$4

$6

$8

2013 2014 2015 2016 2017 2018

$0

$2

$4

$6

$8

2013 2014 2015 2016 2017 2018

($B)

($B)

Developed Emerging

Developed

Emerging

Developed

Emerging



International markets … targets of opportunity

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Positioning Rockwell Collins to be a global leader

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Keys to Success Key Capabilities

Local Requirements

Product/System Customization

Channel Access



Doing business internationally … how our partners can help

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Effective Offset

Strategy

Market Channel

Customer Satisfaction

Working together, we will succeed internationally with our customers, our partners and Rockwell Collins




Accelerating Our Return to Growth Phil Jasper Executive Vice President & COO Government Systems




What you do matters

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What we do

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Integrated avionics for manned and unmanned aircraft

Head down, head-up and helmet displays

Integrated mission and training solutions

Networked communication

Precise navigation and targeting



Who we serve

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Fixed Wing

Rotary Wing

Ground Forces

FY’13 revenue $2.4B

Fixed Wing 56%

Ground Forces 24%

Rotary Wing 20%

Domestic 71%

Int’l 29%



Market outlook

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New airborne platforms transitioning to production

KC-46, KC-390, dual-use helicopters and F-35

Fewer new platform developments drive incremental upgrades to legacy fleets

Airspace mandates and civil interoperability

Safety and situational awareness

A2/AD and non-permissive airspace access

Obsolescence

Army drawdown will continue

Shift from traditional development model to off-the-shelf procurement

Increased international spending on border security and surveillance



What differentiates us

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Leverage Commercial

Systems technology

Return to growth

Breadth of mission solutions

Captured positions



Captured positions deliver growth

New development programs

International C-130 KC-10

KC-135

P-3

USCG Aircraft

E-6

UH/MH-60 & 47

F-35 Avionics & Simulation

Incumbent programs with long service life remaining

Long Range Strike

T-X

UCLASS

CRH

VXX

JTRS HMS

International Targeting

SAAB Gripen US/NATO AWACS CH-53K KC-46

MIDS-J ARC-210

Captured programs yet to enter production

KC-390

AW-101, 169, 189, 609

International C-130 JPALS MGUE TTNT

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International portion of GS revenue is growing

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Addressed international market growing

Dual-use helicopters and fixed wing upgrades

Targeting systems

Networked communications

Regional growth drivers

Europe – airborne upgrades, dual-use helicopters

Middle East – airborne upgrades, targeting systems

Brazil – airborne production, networked communications

Asia Pacific – airborne upgrades, dual-use helicopters, networked communications

FY’13

FY’18

Domestic 71%

Int’l 29%

Int’l 35%

Domestic 65%

FY’08

Domestic 79%

Int’l 21%



What we need from you

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• Flawless execution is crucial in current defense environment

• Quality — eliminate rework at all levels

• On-time delivery

• Key determinant for your future business opportunities

Deliver on Innovation Collaboration

Commitments




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• Help our team discriminate our solution in the marketplace

– Support the development of our product/technology roadmaps

• Reduce size, weight, power and volume

• Affordability is key — your Lean efforts make a difference

– Consider life cycle costs


Commitments




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• Good news or bad — communicate early and often

• Make us aware of product and/or process requirements that drive inefficiency

• Teamwork — it takes all of us to deliver on our commitments


Commitments



Wrap-up

• We need each other to be successful

• Continue to execute to commitments

• Communicate…communicate…communicate

• Help our team succeed in the global market

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Thank you for all your efforts!



Remember, what you do matters

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Solar Impulse co-founder rescued from helicopter crash

http://www.shutterstock.com/subscribe.mhtml




2014 Annual Suppliers Conference

Accelerating Our Return To Growth Kent L. Statler Executive Vice President & COO Commercial Systems



What we do

Integrated flight decks

Head down and head up displays

Communication, navigation and surveillance systems

Information management systems

Flight control

Global customer service and support

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Markets we serve

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Air transport OEMs

FY’13 revenue $2.2B

WB IFE 4%

Business and regional OEMs

Aftermarket

Business & regional

45%

Air transport

51%

OE 56%

Aftermarket 40%

WB IFE 4%



Market outlook

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Robust backlogs

Historically high production

Strong aftermarket

Air Transport Business and Regional

Delivery rates are bottoming

New models entering service

Aftermarket will improve with increased aircraft utilization



Captured standard positions deliver growth

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5 unannounced programs

Boeing 787

Airbus 350

Bombardier CSeries

Boeing 737MAX

COMAC C919

Boeing 777X (Future opportunity)

Embraer Legacy 500

Embraer Legacy 450

Bombardier Learjet 85

COMAC ARJ 21

Bombardier Global 7000

Bombardier Global 8000

Gulfstream G280

Air transport aircraft

Business and regional aircraft

Mitsubishi MRJ



New standard positions bring increased content

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~1.5X

~4.0X

~1.5X

~2.0X Light Jet Heavy Jet

Boeing 737NG

Boeing 737MAX

Airbus 330 Airbus 350

Boeing 767

Boeing 787

Content expansion



What do we need from you?

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Collaboration Cost, quality and customer

satisfaction

Innovation and program

performance

• Provide robust product development roadmaps

• Invest in differentiating capabilities to improve our mutual win rate

• Innovate to reduce size, weight, power and cost

• Deliver on commitments

• Deliver predictable & dependable performance

• Engage us on quality and cost early in the lifecycle

• Deliver on-time every time with 100% quality

• Be responsive to customer needs

• Aligned performance objectives and goals

• Increased collaboration and joint accountability

• Create a sense of urgency in your organization

En

ab

lers

A

rea

s o

f F

oc

us



Summary

• Captured positions and recovering markets are driving growth

• We need to drive a sense of urgency and increase the pace of innovation to sustain differentiation

• Customer expectations for quality, on-time-delivery and cost competitiveness are increasing

• Building trust through meeting our commitments is important to being awarded follow-on business

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Leadership focus on improving quality and cost competitiveness is critical





Transformation through Fast Flow Supply Mike Much Senior Director Operations Optimization



Fast Flow Supply opportunity

• External benchmarking data shows that our work flows are significantly more complex than industry peers

– Our order fulfillment times are 33% greater

– Our OTD to customer request date is 17 points lower

– Our supply base is 10X larger

– Our Procurement agents manage approximately 10X more items per agent

– Our intra-facility shipments are 10X higher

• These inefficiencies drive:

– Increased costs and inventory

– Gaps in material availability

– Negative impacts on customer satisfaction

– Employee frustration



Fast Flow Supply

Operations’ approach to significantly reduce process complexities, improve material flow and develop varied customer fulfillment models

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Logistics thread

Planning thread

Procurement thread

Fast Flow Supply

eSupply Chain



Driving to solutions

Logistics

• Logistics network strategies & organization opportunities

• Replenishment model to synchronize procured material through manufacturing and service deliveries

Planning

• Implement strategic fulfillment models that drive us to “make to order”

• Overhaul and manage all aspects of product lead times & planning cycles

Procurement

• Develop better models for supplier and part selection

• Synchronize and simplify supplier management approach

eSupply Chain

• Transform Logistics & Planning controls, decision-making & automation

• Redesign and automate procurement process and tools to simplify work

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High-level project schedule

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Solutions

Solutions

Solutions

Business Case

Bus. Case

Business Case

Scope

Scope

Scope

eSupply Chain aligned strategies and support

Aug ‘13 Apr ‘14 Jan ‘14 Nov ‘13

We are here Aug ‘14

Planning

Logistics

Procurement

FY

’17

Fin

ish

Lin

e Implementation

Implementation

Implementation



Implications of Fast Flow Supply

• Transforming how we run our supply chain functions by reducing complexities

• Supply base can anticipate seeing changes in the coming months

– Technology investments and alignment

– Automation and collaboration

– Supplier selection weighted to our Trusted Supplier results

– Easier to do business with

• Implementation of successful solutions will deliver:

– Reliable, consistent material availability

– Improved material flow

– Simplified and automated processes

– Greater customer satisfaction, which supports business growth

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How can our suppliers contribute?

• You see supply chain innovation everyday from your customer base…bring it forward!

• We are looking for suppliers that want to grow and be transformational.

• Speak up about what drives complexities between us.

• Perform and become a precious metal partner!

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Achieving the Next Level of Operational Excellence Bruce King Senior Vice President Operations




Achieve the next level of operational excellence

Operations optimization

Deliver exceptional quality

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Rockwell Collins optimization

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FY13: Finance

FY13: Operations

FY13: Human Resources

FY14: eBusiness

Sales & Marketing; LCVS

• Dynamic market conditions require us to think differently about what we do and how we do it to

• Successful improvements will position Rockwell Collins for long-term

competitiveness, growth and success



Operations optimization

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Fast Flow Supply model • Significantly reduce process complexities • Improve material flow • Develop varied customer fulfillment models

Factory transformation • Organization around technology for flow and quality • Clean, professional appearance • Agility to adapt quickly to shifts in production demand

New product introduction • Design for Production approach

• Improved material selection, producibility and testability



Delivering exceptional quality

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Superior achievement in performance, surpassing what has been previously accomplished

Environmental drivers Strategic implications

Increasing customer

expectations

• Expect near flawless execution

• Accelerate performance improvement – prevent issues

• Culture of rapid containment – protect the customer

• Extend performance requirements and solutions to supply base

Business growth

• Stronger linkage of quality to business opportunities

• Greater globalization emphasis

▸ Flexibility where we manufacture and/or procure products

▸ Develop supply base capabilities

▸ Processes and systems to support manufacturing and supply transitions

▸ Balance a less complex, yet global, supply chain



Rockwell Collins Quality Maturity model

Prevention

Continuous Improvement

Variation Reduction

Stability & Control

Quality Management System

Rockwell Collins actions

• Proactive supplier management

• New product introduction

• Root cause corrective action

• Standard work

• Change controls

• Stop and Fix

• Inspection and detection

Supplier accountability

• Platinum Premier status

• Use Last Article Inspection

• Limit process changes

• Communicate issues early

• Flow inhibitor improvement

• First Article Inspection

• Proactive quality certifications

– Nadcap accreditation

– AS9100, ISO9000



Achieving next level of operational excellence

• Aggressively pursue Operations optimization opportunities

• Fast Flow Supply

• Factory transformation

• New product introduction

• Deliver exceptional quality to every customer every time

• What got us here, won’t get us there

• Better every single time




Full Speed Ahead Kelly Ortberg CEO and President





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Thank you!

Documents

Welcome []/media/Files/Unsecure/News and... · Phil Jasper Executive Vice ... © 2014 Rockwell Collins. Proprietary All rights reserved. Information What you do matters 21 ... Remember,