Emerald Group Publishing Limited
Copyright © 2008, Emerald Group Publishing Limited
Creating competitive advantage
Article Type: Mini features From: Aircraft Engineering and Aerospace Technology: An International Journal, Volume 80, Issue 2.
In its new report, “Creating Competitive Advantage” PricewaterhouseCoopers proposes a new framework to help aerospace and defence companies transform programme management. While the defence industry remains robust and growing, programme execution is still one of the biggest challenges for companies in the sector. A number of recent widely reported cost overruns, schedule delays and quality issues have led to marketplace pressures, such as calls for higher standards of programme management. There is an opportunity for companies throughout the industry to raise the bar on programme execution as they try to meet these heightened expectations. While many of the defence industry's top-tier companies have recognised programme execution challenges and taken steps to address them, there is little indication that the rest of the contractors and their supply chains are moving similarly.
Additionally, increasing complexity in programme management extends beyond the defence industry, affecting the commercial side as well. Glenn Brady, partner, PricewaterhouseCoopers said: “The issue is not whether companies can manage programmes, but whether they can manage those programmes effectively enough, given the challenges they are facing. Competitive advantage and market capitalisation are at stake and the risks of penalties, cutbacks or even programme termination have never been higher.
Company management and their program managers need a balanced framework to guide them in transforming culture, processes, and technology in order to support successful execution of existing programmes. Programme management effectiveness must be elevated across the entire supply chain and should link to a strategic management approach.” The framework, proposed by PricewaterhouseCoopers, is supported by five principles that enable management to develop an effective model that involves a company's organisational, cultural and business process aspects: Shared Goals Alignment through shared goals helps establish common metrics and objectives so that separate team members can make unified decisions to support overall programme execution. Companies and their partners need to align tactical program decision making with strategic planning, both at the corporate and local level:
Open communication. An effectively managed programme depends on open lines of communication, which foster a collaborative environment and empower individuals to best meet programme needs.
Integration. All programme facets must be integrated, especially planning elements such as cost budgets, task schedules, and technical accomplishment milestones. Risk management, strategy and planning must also be incorporated into programme planning.
Proactive mindset. Unlike reactive approaches or crisis management, proactive programme planning makes sure the analytical framework is in place from the start to quantify trade-offs and impacts, and to deploy resources on long-term strategic organisational imperatives instead of just meeting the needs of the moment.
Knowledge management. The key is to capture, communicate, learn from and retain knowledge and use it as a basis for collaboration and to make all those activities embedded and continuous parts of the culture and operations of the company and its business partners. Glenn Brady, partner, PricewaterhouseCoopers said: “Developing a more effective programme management mindset and the necessary supporting tools is no longer an option. Industry leaders have embraced plans to transform and/or improve their programme management approach, and they are increasingly demanding the same of those they work with.”