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Fighter jet contract a proving ground for IT

Dan Verton, Information Age

30/11/2001 17:12:42

Lockheed Martin's capture of the Pentagon's $US200 billion Joint Strike Fighter (JSF) contract may be the most complex and demanding test of product data management software in the defence and aerospace industry, experts and analysts say.

In winning the largest defence contract in history in November, Lockheed Martin, which is partnering with Northrop Grumman and BAE Systems, defeated the team led by Boeing. And although IT played a critical role in Lockheed's ability to produce a winning concept for the advanced jet fighter, the upcoming design and production phases will be the real test of how well Lockheed's software team performs, said experts.

"When you firm up a design, that's when you firm up your costs and the manufacturer's process capability and ability to produce," said Mike Burkett, an analyst at AMR Research. It's in the design phase that "you find out if your concept actually works", he said.

The Pentagon will scrutinise Lockheed's performance during the upcoming design phase and as production of the estimated 3000 jets ramps up in 2009, said Burkett. The rollout, which will include the UK and other US allies, will continue for 25 years.

Schedule and cost control, which are highly dependent on the use of collaboration software, will be critical to Lockheed keeping the contract, Burkett noted. There's also a remote chance that the company could drop the ball and lose the contract, he said.

Responsibility for keeping the program on track rests on the software that helped Lockheed snag the contract in the first place. Metaphase from Structural Dynamics Research (SDRC) could eventually support up to 50,000 users in 30 countries once the JSF program hits full speed, said Tim Nichols, manager of Aerospace & Defense Industry Marketing at SDRC, now a part of EDS.

"When it goes full course, it's going to be the most complex virtual enterprise ever conceived," said Nichols. "These aircraft change every five years as technology changes. So tracking changes and reuse is absolutely critical."

Everybody, from the design team to suppliers, needs to have access to the most recent data, 3-D models and drawings, said Erica Rugullies, an analyst at Giga Information Group. "Without a PDM (product data management) tool, they would be printing out a paper copy of a 3-D drawing, and a trading partner would be forced to re-create it," said Rugullies.

The Lockheed and Boeing JSF development teams both used Windchill Web-based portal software from Parametric Technology to integrate multiple PDM, enterprise resource planning and database systems during the initial concept phase of the contract, which included the production of three prototype aircraft from each team.

The design phase ahead will be one of the biggest challenges Parametric's software has ever encountered and will undoubtedly become a model for other industries, said Mike Brown, senior vice president of sales for aerospace and defence at Parametric.

"Whether it's the aerospace, high-tech or automotive industry, you really have the same kind of business issues that you're grappling with," he said.

What's next on Boeing's agenda?

Despite its loss of the multibillion-dollar JSF contract to Lockheed Martin, Boeing may still receive some critical IT-related work from the program as well as new revenue from efforts to boost commercial airline security, said analysts.

Although there's still talk on Capitol Hill about forcing a split of the $200 billion JSF contract, analysts said Boeing's superior reputation for process and cost management will likely result in substantial subcontract work on the JSF program. In addition, the company is looking to extend some of its commercial airline IT programs, such as its broadband Connexion service, to the burgeoning security arena in the aftermath of the September 11 terrorist attacks, analysts and company officials said.

Speaking recently at the Goldman Sachs Global Capital Goods Conference in New York, Boeing CFO Michael Sears said additional business segments for the company will include an expansion of Connexion service to the government sector and an increased focus on global air traffic management.

Connexion, a broadband satellite connection service initially designed to bring Internet access and video to passengers, could also be used to send real-time images from aircraft to ground stations, said Mike Burkett, an analyst at AMR Research. Although it's still in development, Connexion could potentially open up the security services business to Boeing, he said.

Since 60 per cent of Boeing's business is in the commercial sector, its increased focus on global air traffic management makes sense, said Burkett. Boeing is trying to leverage its IT programs to take over supply chain management for airlines as well as for other vendors, he said. Recent initiatives include Boeing's Global Airline Inventory Network for online supply ordering.

In the end, Boeing will be able to absorb the loss of the JSF contract much better than Lockheed would have, according to a report by Michel Merluzeau, an analyst at Frost & Sullivan. Boeing "is a more diversified and cash-rich company", he noted.