Changing of the Guard

On October 2, Ron Chapman retired from the Cessna Aircraft Company after 37 years. During his career, Chapman rose up through the ranks to lead the service and support team for what is arguably the most successful business jet manufacturer of all time.

Based on unit sales, Cessna is the world's largest manufacturer of general aviation airplanes. In 2005, Cessna delivered 1,157 aircraft and reported revenues of approximately $3.5 billion. Since the company was originally established in 1927, more than 187,000 Cessna airplanes have been delivered. The 4,500 Citations flying is the largest fleet of business jets in the world

Much of that success can be attributed to the service and support infrastructure put in place to keep those aircraft flying and the customers who utilize them happy. Chapman has been an integral part of defining and overseeing that infrastructure.

The week before his departure, Chapman graciously hosted Aviation Maintenance magazine at the Cessna Citation Service Center in Wichita, Kansas, to discuss his career, product support, parts, the cyclical nature of aviation, and to introduce his replacement, Mark Paolucci.

Chapman, a Kansas native and graduate of Wichita State University with a degree in accounting, began his aviation career with United Beech, a Beech distributor in the mid-'60s. He worked line service and then moved into the credit and collections department.

In 1969, he went to work for Cessna in the billing department for aircraft parts. He moved up and began running an organization called Business Management, which acted as consultants to Cessna dealers.

We went out and helped dealers in many different ways," said Chapman."We did dealer operational audits, installed financial systems, and we did business consulting for dealerships that wanted it."

From that early start, he learned two big lessons, "We are all in business to make money, and to pay attention to details," he said.

Chapman didn't stay in that position for long. "For some unknown reason, in 1974, I was asked to run the parts business for all prop products," he said. At that time, it was approximately a $25-30 million business.

Later, the parts business for Citation aircraft and turboprops was added to his slate of responsibilities. "Once I got into the parts business, that's when I began to believe that service will always sell," Chapman said.

That philosophy could serve as the mantra for the Cessna product support and services department. Indeed, Chapman repeated that statement many times during our discussion. He added, "In philosophies, it hasn't been written but demonstrated in the way we treat customers."

Chapman continued to climb the corporate ladder until he held responsibility for the entire customer service discipline for all Cessna product lines worldwide. At retirement his responsibilities included parts distribution, product support, and all service facilities. This portion of Cessna's business amounted to more than 20 times the revenue for the company compared to when he started in 1974.

During much of his professional advancement, Chapman was given guidance by Joe Solomon, then leader of all aftermarket business. "I'd be remiss not to mention a mentor of mine, Joe Solomon, vice president of Citation product support and then later, in 1983, vice president of all aftermarket. I learned a lot from Joe. He was a common-sense leader who believed in taking care of the customer. But he also believed in running a business like a business."

Ups and Downs

Cessna has survived, even thrived, in spite of ups and downs of the aviation industry and the economy. "I think two things helped us. We've always been innovative in new product design, and we've made tough decisions to invest in the downtimes. Those decisions to invest in the downtimes carried us out of bad times, spring loaded for success," Chapman stated.

Chapman said that the aftermarket had contributed enormously to Cessna in the down cycles of new aircraft sales in the last 20 years. "Certainly, in both parts and in service," he added.

"One other thing, up or down years, I don't think we ever lost track of the customer. Our customers have been enormously loyal as a result. This is a corporate culture that was started with Duane Wallace, presidnet and chairman. It passed from Wallace to Russ Meyer, to Gary Hay, and continues today," he said.

Overseeing Growth

The Cessna Aircraft Company has experienced tremendous growth during Chapman's 37 years at the company. He explained that two things have helped manage that growth. "One is good people," he said. "And two is that the growth of the company took place over quite a period of time. I took on additional pieces of responsibility as the company needed."

Chapman also gave credit to Russ Meyer, former CEO of Cessna, for his leadership over the years that he was with the company. "Russ is the singularly most focused individual I've ever known. Look at the products that we've taken to market. He did a phenomenal job of introducing the right product at the right time. And if you look at Russ' career, you can see that he was just a wonderful leader for this company, this community, and this industry."

"One thing that made Cessna really great is continuity of leadership," he added. "We've had more [leadership] change in the last six years than in the last 70. But they all believed in taking care of the customer."

Working with an OEM

Chapman offered this advice when asked how a customer could make the most of their relationship with an OEM. "Communications, early and often," he said. "I can't speak for others, but at Cessna, if you are having a problem, let us know. In my tenure, the philosophy has been that you teach people to fly in a 150, or a 172. As those people prosper, over time, they work up through the models."

Chapman emphasized the importance of long-term thinking. "The reason for introducing the Mustang is to have an entry level Citation, so that over time they will upgrade, if you treat people right," he said. "We have seen that enormous amounts of times. John Deere, for example. They started early on flying 310s. They were an early 500 [model] purchaser; an early 650 purchaser. They bought one of the early serial numbers knowing there may be some initial problems. But their observation was that they also knew that Cessna would do the right thing."

When asked for an example of doing the right thing, Chapman told this anecdote. "Way back we had a very tough customer," he said. "He owned a Skymaster. That aircraft had had some problems years earlier. But one thing got the customer mad. That customer was the only customer I knew who actually liked whitewall tires. But we phased those out and didn't carry them in stock any more.

When this customer found out, he was furious. We didn't even think we could get whitewall tires anymore. But, even though he was the only customer asking for them, we special ordered enough tires to last him the life of his aircraft."

Cessna administers the warranty for everything put on the airplane. "We support our products," he said. "We're proud to do it. We selected the vendor parts on our aircraft, and our customers, very rightly so, hold us accountable for them. I don't know how you sidestep that responsibility, and we don't try to.

For instance, we put the TPE 331 engine on one of our aircraft. We supported that in house. Allied Signal couldn't believe it. No other OEM wanted to do that. It's just in our DNA. If it goes on our plane, we'll support it and stand behind it."

Setting the Tone

Chapman said that he felt that the initial experience sets the mood for the long-term ownership experience, with the first 90 days being critical. Cessna has a process whereby it knows of difficulties at delivery and calls on the customer once they are home to get those lingering issues resolved.

"The worst thing in the world is the customer who doesn't hold up his hand and let you know if they are having problems," he said. "But again, our customers aren't bashful. We will go to their site or have them bring the aircraft back into Wichita to correct any deficiencies. We do everything that we can to work the issue. This influences the long-term relationship, so we want that first 90 days to be stellar."

With the information garnered from working with the customer in those early days, Cessna feeds that information back into the production line to make sure a situation isn't repeated.

Chapman cited an example of how the company handled one such situation, with the customer of a newly delivered CJ3 who was experiencing problems with the full authority digital electronics control (FADEC) system that controls all aspects of aircraft engine performance.

"The new CJ3 owner that had difficulties happens to be flown by the owner and his wife," he said. They take long trips and are very mobile. They had some initial FADEC issues. We spent a lot of time communicating with this customer. We really worked on it. It took more than one visit to resolve.

"They were very patient [and] firm, but they allowed us the opportunity to fix it. Now they love the plane. Even though it took a couple of attempts to fix the problem, now they are satisfied customers.

"This scenario has been repeated in various forms many times. It is unfortunate that those issues occur. We are looking to improve our consistency in products and services to remove that variability."

"New airplanes occasionally have issues," he said. "The biggest challenge is to keep the customer satisfied and respond to those issues with a sense of urgency. Our customers are very forgiving, but they expect resolution. The only time they get cranky is if it takes too long to obtain that resolution.

"People buy Citations because they know we will make it right. They are not unreasonable. In fact, over the years when a customer is requesting something of us, I have often asked, 'What do you think is fair,' and their suggestions are fair."

Service Center Network

A crucial part of the support structure at Cessna is the Citation Service Center network, where the company has made a huge investment. There are nine Citation Service Centers in the United States: Wichita, New York, Sacramento, Long Beach, Orlando, Toledo, Milwaukee, San Antonio, and Greensboro; and one in Europe, at Le Bourget airport in Paris.

"We made that investment because it was the best thing to do. The way our service centers are geographically located, our customers are not much more than one hour away from a service center anywhere in the U. S.," Chapman said.

In 2000, Cessna announced plans to increase its support capacity in a very big way. First, the company announced it would build the Orlando Citation Service Center. In conjunction with that project, the company began construction on a new Citation Parts Distribution (CPD) facility, which opened in October 2001.

In November 2001, the company announced plans to build a new Wichita Citation Service Center. It would become the largest general aviation/business jet aircraft maintenance facility in the world, measuring 447,259 square feet.

Chapman said experience gave him the confidence to make these bold decisions. "We knew we needed to add to our service capacity," he said. "Quite frankly, our customers told us we needed additional capacity. We analyzed the areas of the country and we asked for a commitment from Textron of more than $100 million." Chapman praised parent company Textron for its willingness to provide the financial backing needed for those projects. "We have not asked for a single investment, from a customer service aspect, that they have not supported willingly. $120 million over a three- to four-year period was a big request and we got nothing but support," he said.

Cessna decided to expand Orlando and Wichita dramatically. The company chose Orlando because of the city's proximity to its Central and South American customers. It chose Wichita because of the associated services available at the factory, such as engineering support. The factory is a natural draw, particularly for new models.

"When we chose the location and built the facility, we did one thing differently," he said. "We located the service center away from the main campus. The main reason we did that was so that it was expandable. We can easily add another 120,000 square feet in the future."

Parts Distribution

Cessna Parts Distribution was built to be easily expandable, too. When asked what contributed to the foresight to plan for expansion even while building the largest facility, Chapman stated, "Optimism, as well as experience." He said Cessna had learned the hard way that other facilities would not be easily expandable.

"Our whole philosophy is that we are in business for the long term," he said. "So we think for the long term. I hope no one ever says, 'I wish that guy had been smart enough so that we weren't landlocked and not expandable.'" He added, "It ought to last."

Managing the build of the mammoth facility went smoothly, in large part due to the contractor, The Law Company. "I had some good people and a really good general contractor. We finished this project on time and on budget," he said.

Now that the service center network is spread across the country, Chapman acknowledged that it is a challenge to standardize the service level at each facility. He said that establishing processes is necessary to accomplish that goal.

"We're not there yet," he said. "We've gotten some negative and some wonderful praise at the same facility. But the ultimate vision is that our customers could walk into any Citation Service Center in the world and, other than the people being different, the experience and processes would be the same-from the way a customer is met at the airplane, to the establishment of the work scope, to the communications, to the delivery. We strive for on-time deliveries, but if it's not possible, [we ask] Why? And what are we doing to make that happen."

The establishment of those processes begins in Wichita. "Our goal is to develop the processes here and perfect them, then drive those processes out into the other service centers," he said.

Since corporate jets are by definition very mobile, customers can choose to go to a service center that is not the closest one.

"This is a relationship business," he said. "For whatever reason, once a relationship is established, the customer may not go to the closest service center but to the one he has the best relationship with."

Business Changes

Chapman said that one of the programs that has been most successful under his guidance is the ProParts initiative. ProParts is a guaranteed cost of operations program based on usage of the aircraft. "One of the things that we are most proud of is a reflection of change in the industry," he said, "and that would be the guaranteed cost of parts programs.

ProParts was invented by Pete Ginnochio when he was at Canadair. But we have pursued it more than anyone in the industry."

ProParts is designed to simplify the planning, budgeting and procurement of spare parts requirements for the Citation. Nearly all airframe and avionics parts are included. The monthly charge is based on estimated annual utilization and a predetermined hourly rate.

"Customers find that it is an attractive service," he said. "They want predictability. There are 1,200 Citation customers on the program. We will continue to expand it in the future. ProParts covers the airframe and the avionics.

Bluebook is now putting a value on these programs. Therefore, you get coverage while you own the aircraft, and you get a premium price for your aircraft if or when you sell it."

He said the Proparts program spreads the risk and is priced on predicted reliability. "If you are on the program, there is no pain at all," he said. "Customers almost look forward to a failure to justify their decision."

Rogue Parts

When asked about a part that may have been sent out to a customer, returned to the factory as faulty, and then placed back in the inventory with a no fault found (NFF), Chapman said, "We are tracking reliability between new and overhauled components. We work with our suppliers on the overhaul specification and change the build spec of the overhaul if necessary. We track the reliability of every component, new or overhauled."

Cessna has a new system in place that is designed to take this problem out of the equation. If a serialized component is returned three times with no root cause found, then it is taken out of the system and destroyed.

Another challenge facing Cessna under Chapman's reign and into the future is the quantity of field service engineers (FSEs). Chapman pointed out two facets to the problem, the number of individuals, and the number of routine visits made by the FSEs.

He acknowledged that there may be deficiencies and stated that Cessna is working to address the problem but that it couldn't be corrected overnight. "We've sold more business jets than anybody else," he said. "They go back in age more than anybody else. Our customers have told us we need more field service engineers.

"We added 11 FSEs in 2006 and are increasing those on a yearly basis to address that issue. But we also try to support the customer in a different manner. We have support available 24 hours a day via a hotline, broken down into product categories by each model."

Reminiscence

Chapman said Cessna has given him a lot of opportunities. "In many moves Cessna has offered me jobs that weren't anticipated or predicted, at least not by me," he said. "And over the last many years, they have given me a lot of support and the freedom to run the business."

He said that he would miss many things, including the people he worked with, and the customers. "I've had some very good people that tend to stay a long time," he said. "The management team that supports me collectively has more than 150 years of experience at Cessna. They do a very good job and have put up with me for all these years."

With extra time on his hands Chapman said he would stay busy. "I'm going to reduce my handicap or give up golf. I'd like to keep interested in what's going on in the industry with some behind the scenes activities, and travel for pleasure," he said. "I may get involved in some work at ADMA [Aviation Distributors and Manufacturers Association]." Chapman also said he was looking forward to spending more time with his wife, Sharon-"She has been immensely supportive, no question," he said-his two daughters, Kim and Rhonda, and his three grandchildren, about whom he said, "I love them twice."

Transition with Paolucci

The transition from Chapman to Paolucci began on Aug. 21, 2006, when Paolucci stepped into his new role in the customer support arena. The two have used the time from August until October to ease the transition. "I am trying to bring him up to speed on important issues and convey my beliefs and philosophies. He'll bring his own ideas.

Mark has had a long tenure with Cessna, but in a different discipline. There are a million details in the aftermarket business. There will be a lot of opportunities to succeed and a lot of opportunities to fail. My advice to him is to establish his vision and processes, and to get the right people to help. The guy that sits in this office just sets the direction. You've got to have the right people to execute the vision and believe in what you are doing."