Sunday, February 1, 2004
Dallas Airmotive
Everything's bigger in Texas and that sentiment includes Dallas Airmotive's commitment to giving its employees the tools they need to stay ahead of the competition and on top of engine overhaul customers' continually changing needs.
To say the past few years have been challenging to aviation service suppliers may well be the biggest understatement of the second century of flight. The slowdowns, shutdowns, and belt-tightenings have affected everyone from the smallest shops to industry giants like Dallas Airmotive.
The ups and downs of aviation come as no surprise to the company's executives. During its 70-year history, Dallas Airmotive has weathered its share of economic peaks and valleys. But while many have bemoaned these slow times, Dallas Airmotive's president and CEO Jim Donlan has used them as an opportunity to retool his organization. "It's given us a chance to refocus on some of the fundamentals we have in our core business," he said. "Certainly in the processes and quality of services along with ways to help control our operating costs. The bottom line is we're finding ways to improve our position in each of the product lines we service."
And that was no small task. Today, Dallas Airmotive has grown into one of the world's largest OEM-authorized providers of turbine engine overhaul and repair services for all the major engine brands including Pratt & Whitney Canada, Honeywell, Rolls-Royce, General Electric, and Hamilton Sundstrand (APUs).
In addition to its main overhaul facilities in Dallas, Millville, New Jersey, and H+S in Portsmouth, England, the company has nine Regional Turbine Centers located across the U.S. and in England. Also, early last year Dallas Airmotive acquired Premier Turbines of Neosho, Missouri. "This has exceeded our expectations," Donlan said. "Now we are able to offer our customers heavy maintenance services on the Honey-well TFE731. We've been able to nearly double our 731 business, and we anticipate even more growth in that product as well."
Today, as part of BBA Group's Aviation Services division and holding a dominant position in aftermarket turbine service, you'd think that Donlan and the rest of Dallas Airmotive's management team would just fasten their seatbelts and ride out the economic turbulence. But like a business jet operator that has its engines on a cost-per-hour maintenance plan, Donlan and his team want to make sure they take steps to fix any process glitches before they become problems down the road.
"We have to change because we absolutely see our core customers' needs and wants changing," Donlan explained. "Our customers are a lot smarter than they were three years ago. I think it's a result of a depressed market. It makes people stop and think and evaluate their businesses and what they value in terms of what gives them a better return.
"They've done their homework before they talk to us so they're more aware of what's available," he continued. "They're also more demanding than ever before. People are pushing us a lot more now; they're asking 'why?' And instead of what used to be a five- to seven-day turn time for a hot-section, now we are providing the service in a matter of a day or two, sometimes to the hour.
"Those changing customer demands have made us take a much closer look at our business and the processes we have in our shops and see how we can streamline and adapt to the new needs of the marketplace," Donlan said. "Today you really can't set a standard way of doing things across your customer base. You have to be responsive to the individual needs of each customer and offer individualized plans to meet those needs. For example, our fractional operator customers have vastly different needs than an individual operator."
Dallas Airmotive's executive team is giving that theory more than lip service. Recently a large fractional-share customer was having problems managing the variety of engine maintenance events it was facing. Dallas Airmotive put one of its technical employees on site at the operator's facility. "Our goal was to give our representative a real feel for their operation so we could better manage their needs," Donlan explained. "By better identifying their needs and operations, we were able to modify some of our processes to match their expectations. We've learned so much we're to a point where we've been able to get maintenance events that used to be five- or seven-day processes down to under 48 hours."
Part of what Dallas Airmotive's managers are doing to create a base for these individualized solutions is to define the different value equations that each customer has. "Every customer has become much more value sensitive today than ever before," Donlan continued. "And so we have to-in turn-become much smarter at perceiving those values and changing our procedures and policies to meet them."
"What has happened," added Ralph Alberto, vice president sales, marketing, and service, "is that a customer's perception of what excellent service is and how it is delivered has changed. "What we've had to do is to find ways to be more responsive to that. It all starts with listening to the customer's unique requirements and then work on ways to deliver on them.
"All factory-authorized overhaul shops can basically do the same kind of work with the same kind of tools," he continued. "We have to differentiate ourselves throughout our entire customer experience. We're not a machine shop, we're a service company. That's the direction this business is going."
How can Alberto and Donlan be so sure about what today's customers are going to want tomorrow? They did something rather revolutionary for the aircraft service business: they asked the customers for feedback. "We've shifted from a reactive approach to managing and planning to a proactive approach," Donlan said. "So if we can start to identify trends and needs in the marketplace, in some cases before our customers know about them, it is going to result in our being able to meet their expectations before they expect it."
Donlan explained that when he and his sales team talk to customers to sell engine work, they have an opportunity to see the business from a lot of different perspectives, and each customer has their own set of values. "It's amazing," he said, "when you ask one of our salesmen what their customers value, you get a list of things prioritized. Then when they come back from a customer trip we find they probably have 50 percent of those mis-prioritized to the customer's needs."
In the recent reassessment of the overall business it has become clear to Donlan and Dallas Airmotive's management team that the company has pretty much gone as far as it can go in terms of tools and technology for overhauling a turbine engine. If there's a new machine or technique, Dallas Airmotive has it.
But, where they do see the next big opportunity to continue to separate Dallas Airmotive from its competition is in the ability to drastically improve communications internally and externally. "We've had to put in system upgrades so that we're much more responsive in meeting the communications needs our customers have," Donlan said. "The people that we have in our shops now not only have to be very good technicians, they have to be very good communicators up through the organization and out to the customer.
"Some are involved with our Six Sigma teams so they have to look at a process and try to find ways to improve it," he continued. "The ability to work in a matrix organization-to be able to not only deal with mechanical requirements of a job but also in material management and communications-is new, but we have to become efficient in working in a changing environment."
Internal communication is only as good as your commitment to responding to what your employees have to say, he added. Managers have to consistently get back to employees with an answer so they know that management is listening to them. If managers aren't listening, employees will stop communicating. "They may not get the answer they want all the time, but you are at least giving feedback to them," Donlan said.
One of the major investments Dallas Airmotive has made to improve communication has been to replace the 11 different legacy computer systems with a single system by Avexus that will now link the entire company, including all of its worldwide branches. "Having one computer system will allow us to communicate better internally, which will help us respond to customer needs faster," Donlan said. "The more up-front data we can make available to our team about our customers, the better we can be at making decisions and the less ambiguity we will have in the process. And when you eliminate ambiguity, you enable people to give customers more accurate information, which often means they can save money."
Another goal of Dallas Airmotive's improved communication program is to keep customers better informed about the status of their engine while it is in for overhaul. "It used to be all the customer had was an end date," Donlan explained. "Today they want and need to know what's happening with their engine on an ongoing basis, and that's opened up a whole new world for us."
To meet this evolving customer expectation, Dallas Airmotive recently introduced the Turbine Update system. "Turbine Update was developed to allow all of our customers to access information 24 hours per day, seven days a week, 365 days a year," Alberto said. "Dallas Airmotive is the only independent engine service company that offers an online tracking system."
With just a few strikes of the keyboard, Turbine Update tells the customer where their engine is, what the next position is, how long it will be there, and how that affects the delivery date.
"As they watch the engine progress through the overhaul process, they can now better schedule their time for engine reinstallation," he added. "Nearly 70 percent of our early users (the program was introduced at last year's NBAA convention), are international customers who are sold on the system's ability to check engine status during their normal working hours without having to make an expensive overseas phone call."
"The program puts more demands on our personnel," Donlan said. "But, because our personnel have to continually update the Turbine Update information, it makes them more aware of what's happening while the engine is moving through the shop. It is making the whole process a lot better.
"Initially it was rather painful for our people, but now they're all on board with it," he continued. "They know the customer is going to be checking tomorrow and they want to see some progress. No one wants to be the person who disappoints them since our teams basically own each engine while it's in the shop."
According to the company, two Turbine Update features that customers find most useful are the e-mail notifications and the ability to see photos of the engine parts identified for rework or that require dispositioning. "Customers can view parts that our shop recommends be replaced," Alberto explained. "They can then authorize the operation online or ask questions with a simple e-mail note to their customer service manager."
"It's really proving to be a major benefit in those situations where we're tearing an engine apart and finding something that we didn't expect in there," Donlan said. "We need an authorization from the customer before we can go forward, and the Turbine Update site saves a lot of time.
"Customers are now a proactive part of the entire process. They can make timely decisions about what they want done with their engine," he continued. "For example, I might be able to save a customer fifteen thousand dollars if I can wait a day or so to get a repaired component instead of using a new one. Now I can tell the customer about it and get an answer almost instantly. In today's environment, a day late is bad, but the chance to spend that extra day and save fifteen thousand can be great for some customers. This level of two-way communication has never happened before and I believe it has changed the expectation levels of customers forever."
As Donlan said early on, today's customer has a much different set of expectations from as little as five years ago. Improving communications and adding value are just pieces in an increasingly complex puzzle that builds a relationship between Dallas Airmotive and its customers. All things being equal, Donlan makes sure that everyone at Dallas Airmotive knows that this is a business built on relationships.
"Where before an owner may make a engine overhaul decision every three or four years, today that relationship is an ongoing process," he said. "Today we're managing the customer throughout the life of that engine on that airframe. In many cases that relationship will transfer to the next owner as well. So the better you are at building that trust, the better your chance of gaining a new customer when the aircraft is sold."
"That's a good point," Alberto added. "We have a lot of customers who, when they were looking at an aircraft and they learned it has been maintained by Dallas Airmotive, they feel much more secure about buying that airplane. It's a serious vote of confidence."
The relationship the company has with its customers isn't the only one that is key to ongoing success. Dallas Airmotive takes great pride and puts great value in the long-standing relationships it has with all of the major engine OEM (original equipment manufacturer) companies. "While the engine is under warranty, the customer will almost exclusively work with the OEM," Donlan said. "When the warranty expires, operators start looking for alternative sources. We're in a good place because the OEMs know we do outstanding work and they can trust us.
"It's also important from a technical standpoint to have a close relationship with the OEM," he continued. "Engines and their components change, and the OEMs are continually updating procedures. Our field service representatives are not only familiar with the engines but also the airframes they are on.
"Our customers often rely on our A&P-licensed field service representatives to help them troubleshoot a particular problem," he added. "The operator may think it's an engine problem when, in fact, it's an airframe issue or visa versa."
"Another benefit to having close relationships with customers and OEMs is we can share what we learn with each other," Alberto said. "When you work on over 2,200 engines a year like we do, you get to see a lot of different things, and when you combine that with the OEMs' databases, we get a real step up on most of the problems our customers will ever encounter.
"It all comes down to adding value to the customer equation," he concluded. "When you have the value, no matter what the current economic factors, you will always be positioned first and foremost in the customer's mind."

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