Business Jet Interiors International: fastforward

2015-04-29 15:25

Under Andrew Muirhead’s leadership, a seven-person unit has grown into a 130-strong team with responsibility for all of Lufthansa Technik’s ‘tangible’ product developments – and now it is benefiting from fresh investment

In 1989, an Australian studying electronic engineering at RMIT University and German at the University of Melbourne, was turned down for an internship at Lufthansa Technik in Germany. Determined to go to what he terms “the land of engineering”, that undergraduate changed his subjects (to major in avionics) and wrote to the company again. “They must have liked my persistence, because then they did give me a six-month internship,” says Andrew Muirhead, who, after quite a roundabout route, came to head up the Original Equipment Innovation division at the company.

That route involved finishing the internship, returning to Oz to complete his degree, traveling the world and working for Andersen Consulting. Muirhead joined Lufthansa Technik’s Development Engineering department in 1996. The job involved installing communication and IFE systems as well as cabin lighting on VIP and commercial aircraft. In 1998, Muirhead launched a little video control center business at the company. The first customer was Lauda Air. “That was my first little entrepreneurial exercise at the company,” says Muirhead. “When I was at university, I built computers for other students, and programmed educational software, so I’ve always had that business streak in me.”

Launching the IFE business The video control centers didn’t get the internal backing they needed to progress, but Muirhead went on to lead the company’s charge into the IFE business. “One evening in 2001, we were doing a night shift on an aircraft, trying to get an IFE system working,” he recalls. “We were having all sorts of problems with it and I said to my colleague, “Why don’t we start developing this stuff ourselves? We seem to understand how it works better because we’re fixing it all the time – why don’t we manufacture it?”

Eventually the company backed this idea, giving Muirhead and his colleague a small budget and a team of seven. “We were like a start-up inside the large company,” he says. “We started in 2003, and we managed to have the unit up and running with €20m (US$21.5m) in revenue in the space of four years. What started as a tiny idea has turned into a significant piece of business here,” says Muirhead.

New facilities By 2008, the unit had run out of space, so a new facility was built. “We looked at what processes needed to be closer to each other, and we designed the building accordingly,” says Muirhead.

There is a qualification test lab, plus facilities for vibration and shock testing, temperature and humidity testing, highly accelerated lifetime testing, power input testing, and an electromagnetic interference chamber.

“We’ve also invested a lot in the development of production and development testing devices,” says Muirhead. “We developed automatic test equipment, so that we don’t need as much manpower for testing.”

The restructure Now the unit is staffed by just over 130 people. In 2014 it was restructured as the Original Equipment Innovation division and given responsibility for the development and manufacture of all ‘tangible’ products at Lufthansa Technik. This means all products outside of the MRO business – whether they are designed for airlines, business jets or VIP operators.

Lufthansa Technik also announced in 2014 that it would invest €200m (US$214.8m) into research and development over the following four years. Not all of that money is being funneled into Original Equipment Innovation, but Muirhead does say the division is “making good use of that at the moment”.

The unit is structured around four business lines: commercial aviation systems, business jet systems, lighting and GuideU escape path marking, and seating and structures. “In commercial systems, we’ve invested a lot of money into the development of wireless infrastructure to support passengers’ devices,” reveals Muirhead. “In the business jet sector, we are investing a lot in further developing our nice HD system – we’ll bring a lot of new functions to market in the next 12-18 months. With seating and structures our focus is on getting chair through the TSO and out to market, although we have other interesting products in the works too, including a dishwasher for VIP aircraft, and some medical products for patient transport. In the lighting and GuideU space, we have been investing in getting our colored lighting system to market. Our investment at the moment is focused on ensuring the products in those four lines are ahead of the game. However, we are also investing some research and development into the next business lines. This funding gives us more freedom to move.”

Each of the lines is run as a business in itself, with a dedicated manager, and has responsibility for its own profit and loss. The four lines are supported by shared operations, sales and marketing, finance, risk management, product planning and engineering units.

“There are engineers attached to certain business lines, but by being in a shared engineering unit, it means that they do actually communicate with each other,” says Muirhead. “It used to really frustrate me when our engineers would be working on a problem without realizing that it had already been solved by somebody else in another area, because they weren’t talking to each other.”

Lean setup The company structure is designed to be as streamlined as possible. “It’s very easy to become slow if you get caught up in big company processes, so the idea is to keep this as lean as possible so that we can move fast,” says Muirhead. “We’re pretty fast in going from the idea to the finished product, and I think that really has to do with how we set up the unit and the fact that the people who work here are very flexible in their jobs.”

The unit holds about 50% of the patent portfolio at Lufthansa Technik. “The luxury we have here is that there is no shortage of ideas,” says Muirhead. “It’s always very tempting to start 20 projects at once, but you’ve really got to stay focused on what you do well, and what is going to be a success in the market. You’ve got to force yourself to focus on the things that are still in progress and not get sidetracked by too many innovations.”

Beer mats Muirhead makes sure the team stays focused on solving customers’ problems, not producing technology for technology’s sake. He has implemented a system whereby people submit ideas on beer mats. On the ‘What’s the pain?’ side they must write the problem they are trying to solve, and on the ‘What’s to gain?’ side they sketch out their solution and how it is going to make money.

“As you probably know from books and movies, most of the best business ideas are sketched out on a beer mat in a pub or on a napkin in a restaurant,” jokes Muirhead. The idea is to prevent engineers from spending too much time on initial pitches. “We would get frustrated that they would put all this work together and it would get shot down pretty quickly because they hadn’t considered where the customer fits in,” he says.

Muirhead has a beer barrel outside his office, with a mailbox flag on the side. “When people have a beer mat idea, they throw it in the mailbox and raise the flag, and on a Friday, we empty it out, look at the beer mats and assess them,” he says. “If there is something worth following, we give the employee a small budget to either prototype the idea or conduct some market research on it, then they come back with an initial ‘quick and dirty’ business case. If it makes sense to follow, that’s when we will go and look into the pot. It’s made a big difference to the quality of ideas because the focus is not just on technology, it’s on solving customers’ problems.”

The engineers are encouraged to develop their ideas iteratively. “It’s about lean innovation, so they do a lot of prototyping, trying things out, learning from the results, and then re-prototyping,” says Muirhead.

At the end of the year there is a prize for the best beer mat idea. “The Brain of the Year trophy is a plastic brain that floats inside a glass container with an LED light underneath it,” says Muirhead. “Whoever wins it has that thing on their desk for the next 12 months. It’s pretty disgusting, but it’s got legendary status here now.”

The department’s methods have been influenced by visiting other companies. Muirhead is also now doing a part-time MBA in Innovation. “Now I’m learning the theory after basically doing this stuff for 15 years,” he says. “It’s really interesting looking back at what we’ve done and what other techniques we could apply.”

With so much practical experience of installations and the certification process, Muirhead is well-placed to understand both the challenges facing his team and the technology they are working on. “I’m not sitting here being Mr Theory,” he says. “I’ve actually done a lot of the stuff and I understand enough of the technology that I can really get into a product discussion.”

Managing growth Muirhead intends to employ 20-30 more people in 2015, and will closely manage how they are integrated. He says managing growth is the most challenging aspect of his job. “We want to grow this business a lot bigger, and we’ve got a good plan to do it,” he says. “The challenge is that we want to maintain our culture. There is a lot of familiarity among our people and if you grow too quickly, you run the risk of losing that.”

Prized traits in new recruits include an area of expertise currently lacking in the team, entrepreneurial drive, a sense of humor, commitment, the ability to work in a team, and honesty. “With innovation, stuff goes wrong, and the only way to be successful is to bring it out into the open,” says Muirhead.

The company also sees a lot of interns. “I always like to have interns here,” says Muirhead. “They’re green behind the ears, but they bring a lot of fresh ideas.” And that, after all, is the aim of the game.

Diverging from the status quo

Andrew Muirhead likes to do things differently – and this hasn’t always gone down well. “We deal with red tape much less now, but in the early days it was a big challenge, because we were doing things very differently and sometimes the organization didn’t understand why,” he says.

He recalls the time he bought beanbags for a new brainstorming room. “I didn’t want a meeting room table because I wanted to have an informal area where we could brainstorm freely,” he says. “Later I got a phone call from the purchasing department telling me that beanbags were not meeting room furniture and asking how I could possibly buy something like that. I said, ‘It’s not a meeting room. How about you look up the definition of brainstorming room and tell me what sort of furniture you have for that?’ They said, ‘We don’t have a definition for that.’ I said, ‘I think you need one.’ Those are the sorts of traps you have to avoid getting caught up in – doing everything that is expected of you, instead of actually questioning the status quo.”

Proudest achievements

As well as the creation of the Innovation business unit, the career achievement of which Muirhead is most proud is “sticking a Boeing antenna on an Airbus aircraft” back in 2000. He even canceled his ticket to the Sydney Olympics to achieve it.

“We had a VIP customer who wanted a big Boeing phased array antenna on an ACJ340,” says Muirhead. “There were political and documentation challenges, and it was extremely challenging technically to install, not least because it was a huge antenna that I think weighed 40kg, then we had to get it certified. Also, we built all the hardware on the back of it as well, so it wasn’t just a case of mounting the antenna. It was an incredible project.”

Tackling a new market

The company recently entered the seating market, with its chair family. “The biggest challenge is getting through the TSO process,” says Muirhead. “We have the approval to be a TSO holder, and the next step is to get through all the testing. We’re getting pretty close. Technically it’s quite a challenge, particularly because our design is revolutionary. You come across some challenges you weren’t expecting because the devil is always in the detail.”

Lufthansa Technik is working with supplier Dräxlmaier on chair. “We do a lot in-house, but we do sometimes cooperate with other companies to develop new products and for manufacturing,” says Muirhead. “It’s often by looking over the fence to see how problems are solved elsewhere that you find out how to solve them in the aerospace sector. It makes a lot of sense to work with them to optimize this for the industry that we’re in.”

He concedes that as a new player, Lufthansa Technik has something to prove. “The challenge is making the market aware that this is a product that we stand behind and that we’ll support,” he says. “It will take some time for market awareness to pick up, but that’s like with any new product.”

Muirhead recalls that when Lufthansa Technik first introduced its IFE system, some business jet manufacturers discounted the company as simply an airline, or an MRO. “It took a number of years before the market really accepted us,” he says. “But now, we’ve got a very strong position in that space.”

Source: Business Jet Interiors International

Go back