Embraer is starting a new services division this quarter that is supposed to bring together capabilities that are spread out between different business areas. What are those functions and how will the transition work?
Bordais: Global Services and Support activities officially became a core business of Embraer at the beginning of the year. During the first quarter, we are designing the new super structure, which will be founded in three main pillars: strategic, operational and tactical. These pillars will ensure a long-term vision, delivering the daily commitments to our customers, and short-term business management guaranteeing both customer satisfaction and efficiency.
This decision came from the fact that three business units’ (defense, executive and commercial aviation), customer support and services organizations have grown apart over the last year--and each created excellent customer support or a portfolio approach that other units can benefit from. As for the Defense & Security support and services activities, we are still assessing the possibility of integrating everything or leaving some areas separate.
How will the new services division support customers differently?
In order to support their respective customers with their own specific needs, each of the Service & Support (S&S) business units have came up with dedicated solutions. The new S&S division will ensure every customer benefits from all these great solutions in a combined way, making their experience with Embraer better.
Embraer is full of great employees with innovative minds; yet up until recently, leadership has been failing to provide strong processes and a dedicating team to ensure we implement these innovations in an agile manner for our customers to use.
This is the reason why we have teamed up with one of the world best human design firms, IDEO, to help us speed up the process to co-create with operators. We do this through our S&S Lab.
Supporting our customers at any cost is no longer an option. Any company must be able to reach excellence in its customer experience by being efficient and profitable, which will ensure long-term sustainability. This is exactly what our customers are looking for: an OEM that is healthy enough to guarantee that it will be there to support them for the very long time.
What are your business goals for the services division, and are there any new tools, technologies or processes that will help you meet them?
Material solution represents half of our services results. This percentage will certainly reduce as we diversify our technical services portfolio to include training and consultancy. Our expertise on maintenance cost management is strong--we help customers save lots of money when operating the aircraft. One of the key successes, and which allows us today to be truly global, is the powerful digital CRM tool we have to monitor our multi-million dollar business with 1,700 customers and more than 5,600 aircraft flying. We must know instantly what is going on with every single customer in order to anticipate any need they may have. Predict the unpredictable is our ultimate mission as our customers simply do not like surprises with operational interruptions.
How will you grow revenues from 15% of total Embraer revenues to 20%, as stated by Paulo Cesar Silva?
The mission that Paulo Cesar Silva, Embraer President and CEO, has given to us is continue exceeding our customer satisfaction and increase our group revenue share from 15% to 25% in the next four years. These objectives will be reached by conquering more organic growth, global synergy and resources optimization across the support activities bringing better efficiency, and diversification of our portfolio services in the aviation market.
How will the new division impact suppliers that work with Embraer?
The new division will allow our customer support value stream to be more global, with the strong intention to have better economies of scale when negotiating support agreement with our suppliers. We are entering an era where customers and suppliers are more and more integrated—and they are part of an ecosystem in constant change.