Académique Documents
Professionnel Documents
Culture Documents
INTRODUCTION
World's second largest aero engine manufacturer. Started in 1906, initially manufactured & sold cars. Later started manufacturing aero engines- civil & defense aircraft. Realized the need to enter US global market In 1960, bagged contract with Lockheed Corp - RB211-22 In 1971, declared bankruptcy & was nationalized by British Govt. In 1996, John Rose became the new CEO & provided new direction.
VISION
To provide the finest, most technologically advanced power systems the world has ever seen. Whether our products are for use on land, at sea or in the air, we continually strive to redefine what is possible.
CIVIL AEROSPACE
DEFENCE AEROSPACE
18,000 engines 24 engine programmes 103 countries 160 armed forces 25% services revenue
MARINE
ENERGY
units -2,500 customers -70 navies -Products on 30,000 vessels -5% services revenue
-4,000 power systems -1,600 customers -120 countries -35% services revenue
FINANCIAL PERFORMANCE
In 2011, Rolls-Royce performed well in difficult market conditions. We have a 62.2 billion order book, underlying revenue has grown to 11.3 billion and underlying profit has increased 21 per cent to 1.2 billion. This success is due to the extraordinary team of over 40,000 people that work for Rolls-Royce.
A NEW DIRECTION
Start of Trent Engine Series again Suitable to the customer Features: -More Fuel Efficient -Lower Emission -More durability
The main focus of the company was to prolong the operating life span of its aircraft engine .
The replacement of engine involved significant costs to an airline company and consumed a lot of time.
Rolls Royce took up the risk and cost for an aircraft downtime and repairs and put more efforts to provide superior services.
EHM Service allowed the company to access the operational data during a flight that helped the company repair the engine quickly.
As a result the airlines preferred buying aero engines from those manufactures that allowed quality After sales service contract over the life span of the engine.
BUSINESS MODEL
The secret to Rolls business model is in the aftercare market. As the companys installed base of equipment grows, the market for parts and maintenance also grows.
CHALLENGES
The company experienced some rare negative headlines after a fleet of new Qantas A380s was grounded after an explosion in a Rolls engine. But this issue have now been rectified. Setback for the company earlier in July 2012- Five Boeing 787 Dreamliners had to be grounded because a component in the Rolls-made engine needs to be replaced.
Contd
As part of their rigorous approach to product safety and quality, they have identified that a component on Trent 1000 engines fitted to Boeing 787 Dream liners has a reduced service life. As a proactive measure, this component is being replaced in a number of engines. They are working hard to minimise disruption to customer operations. But despite Rolls reassurance, its shares dropped.
Threat of climate changes and other environmental challenges like emission of carbon.
Rolls-Royce has a highly-skilled and motivated team proud of its heritage and ambitious for its future Sir Simon Robertson Chairman
IMPLEMENTATIONS
Rolls-Royce produce a range of quality world class turbine engines, and have recognised that they must change in order to compete effectively with their competitors. Therefore, they implemented the ERP system. Increased orders from the market place, and also from the fact that ERP has become a standard solution world-wide within the Aerospace and Defence industry. Deciding where to invest for future growth. Although they are subject to inflationary pressures and tough competition they will benefit from the growth of the business, from investments that will improve efficiency and from an increasing focus on cost performance and cash conversion.
Contd
Acquisition of the German industrial engines group Tognum, biggest acquisition, made in a joint offer with Daimler. It will bring together highly complementary product and technology portfolios and creates significant new opportunities for marine and energy businesses. Signed an exclusive deal with Airbus to power the long-range Airbus A350-1000 aircraft, for which they will develop an enhanced Trent XWB engine.
Contd
To sell equity stake in International Aero Engines (IAE) to Pratt & Whitney, at the same time announcing the intention to form a new joint venture to develop engines for the next generation of mid-size aircraft. This agreement builds on a long and successful partnership with Pratt & Whitney, and charts a clear course for our future in this important market segment. Energy business signed its biggest ever single contract to supply Petrobras, Brazils leading oil company, with 32 gas turbine generation packages to support its offshore operations.
They continue to follow the strategy that has been in place for many years, and can be summarized as: Addressing four global markets: civil aerospace, defense aerospace, marine and energy. Investing in technology, capability and infrastructure. Developing a competitive portfolio of products and services.
Contd.
Adding value for the customers through product-related services. Recognised the importance of sustainable development. Continuously developing more efficient power and propulsion systems. Maximise R&D investment through an approach of invest once use many times in products across the four major segments.
PRESENT STATUS
Rolls-Royce has retained its position in the DJSI for the tenth consecutive year, with an overall score of 78 per cent (aviation and defence sector average 49 per cent). In 2011, Rolls-Royce retained its Gold status with an overall score of 91 per cent. Also scored 94 per cent in the Environmental Index component of the overall survey. One of the leading companies in the CDP Index.(75% in 2011, 79% in 2010)
Effective utilization of resources. Operational Efficiency. Strong market presence. Focus on Research & Development.
Lawsuits.
Threats
Strategic Contracts. Growing US Aerospace Industry. Positive outlook for global energy market. Increase in Defense spending. Stringent Regulations. Threats facing energy Industry. Rapidly changing technology. Substitute for renewable energy Sources.
MODEL
Threats of Substitute Product There is no substitute for an aero engine and the threat of substitutes for air transport itself is minor.
Threats of of New Threats New Entrants Entrants Entry to the aero-engine industry is extremely difficult. The market is also sensitive to the reputation of the engine manufacturer.
Bargaining Power of supplier Suppliers have limited power. Powerful suppliers are those involved in the supply of high specification electronic control equipment.
Bargaining Power of Buyers The power of buyers is High. The numbers of potential buyers of new aircraft are low.
FUTURE PLANS
The company is investing in a new engine production facility in Singapore and a turbine blade casting plant in Rotherham, South Yorkshire. Company has signed a $2.6bn contract with Singapore Airlines to power 20 Airbus A350s and 5 Airbus A380s and agreed an order for the US Navy to power its future fleet of Ship to Shore Connector hovercraft.
Contd.
As Rolls has produced a new, more powerful and efficient engine that impressed US appraisal teams therefore company believes the order will provide the platform for winning more contracts with other navies.
CONCLUSION
Rolls Royce developed orientation to become more business and service focused. The structure of organization has been realigned to meet the needs of the new way of operating. Organizational structure define important relationship within the business.
Contd..
Organization changes from a product-focused organization towards becoming a service oriented culture. Rolls Royce corporate Identity is to encourage, building its past reputation and achieve for continuing success. Company is also realigning its financial reporting framework and corporate governance. This will change how whole business shapes its purposes and priorities.