BAE SYSTEMS contract will cut Tornado support costs
10 Jan 2002
BAE Systems has won a 10-year contract worth just over 35 million for an innovative approach to the repair of Tornado airframe parts for the Royal Air Force.
The contract, won by BAE Systems Customer Solutions & Support business, will improve availability to the RAF's front line Squadrons for four major Tornado airframe items (rudder, intake, windscreen and wing nib assemblies) through a performance-based support service.
It has been secured as a result of a more co-operative partnering approach developed between the Tornado Integrated Project Team (IPT) within the Defence Logistics Organisation (DLO), RAF Strike Command, BAE Systems and other industry organisations.
The solution involves a one-stop service managed by BAE Systems. It will ensure guaranteed availability for the four items, including all technical support. BAE Systems spares and repairs business at Chadderton will be involved along with other key suppliers.
This is the second contract to be awarded as a result of the work of the Tornado 'Tiger Team'. The team is developing streamlined ways of supporting and servicing the aircraft. The first contract, which extended support for GR4 avionic items from five to ten years, was awarded in June 2001 to a value of approximately 45m.
"The two contracts combined provide resource control reductions above the DLO's 20% cost reduction targets whilst providing significant business growth for BAE Systems," commented Air Commodore Bryan Schofield, the MoD's Tornado IPT leader.
"This structures contract paves the way for developing further our partnering relationship with the Tornado IPT in the DLO," commented Nick Kilner, the BAE Systems co-team leader of the Tiger Team. "We have proven that through working together we can take out at least 20 per cent from support costs through rationalisation and performance-based pricing."
The Tiger Team is now working towards bringing to a successful conclusion the remaining two pilot proposals within Phase 1, the secondary power system and ADV Foxhunter radar, worth together at least 150m.
Planning for Phase 2 is currently taking place. This aims at broadening the scope to other areas, including technical support, infrastructure and on-aircraft opportunities.
Notes to Editors:
A Smart Acquisition partnering agreement was signed in July 2000 between BAE Systems' chief executive John Weston and General Sir Sam Cowan, the Chief of the UK MOD's Defence Logistics Organisation (DLO). The two organisations agreed to work together to achieve the DLO's cost reduction target of 20% by 2005 in exchange for increased business for the company.
The MOD is looking to reduce costs by outsourcing non-core activities, gaining increased value for money and maintaining or improving delivery of performance to the Front Line.
As a result of this agreement, the Tornado Tiger Team was established in May 2000 to streamline support for this aircraft. It includes experts from Strike Command, the Defence Logistics Organisation's Tornado IPT, the Defence Aviation Repair Authority and BAE Systems.
A partnering approach and an incentivised contracting framework underpins their work in cutting costs through streamlining Tornado support.
A series of pilots was launched in September 2000 against the criteria of:
* time taken to get to contract
* ability to demonstrate value for money
* robustness of the support solutions
* the strength of the relationship
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