Following a year of planning, 2011 will be the year of action for Hawker Beechcraft, company CEO Bill Boisture said.
The company is in the midst of putting in place an internal plan called Project Challenge, a "large-scale transformation that we spent most of last year planning," Boisture said.
Boisture has described Project Challenge as focusing on four areas: reduction of facilities, decisions on core and noncore tasks, supply chain rationalization and lean manufacturing initiatives.
"We're committed to building a smaller, more agile company," Boisture said.
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Plans are moving along "quietly and purposefully," he said.
"It took a fair enough time to plan this, and we planned it pretty well," Boisture said. "We're further into it than most people realize."
As part of the plan, the company said in December that it would keep operations and at least 4,000 jobs in Wichita in exchange for a $45 million bond package from the state, city and county.
It's also closing Plants 1 and 2 and moving work to Chihuahua, Mexico, and to outside suppliers, a move that will cut 800 jobs in Wichita.
The closing of the facilities, including a plant in Salina, and the shifting of work will occur this year. "A lot of that is here in Kansas, and a great deal of it is in Mexico," he said.
Although the company is undergoing a major transformation, the decisions have brought stability to the company, Boisture said.
"We're in Wichita, we're in Little Rock, and we're in Chihuahua," he said. "We have committed to be in these places — to be here and fight and win from these places."
The decision was important to the community, he said. It was also important for employees.
"I think it brings a sense of calmness to our people and a way for them to plan their personal futures," Boisture said.
The company continues to streamline and lower the cost of its supply chain.
"We're doing a better and better job on the quality of what we're doing, and therefore costs are going down," he said.
The company has begun receiving the first major components from Mexico, he said.
First article inspections have been "excellent," Boisture said.
The company also recently received the first King Air wing built by Aernnova Aerospace Mexico, a third-party provider that will be the sole supplier of wings for the Bonanza, Baron, King Air, Premier and the Hawker 400XP, according to information from Aernnova.
The company is also working to improve its field support around the world as the percentage of sales from outside North America increases.
The company will increase parts inventory 140 percent in the next year.
"This is fundamental to reliable support for a worldwide fleet of jet airplanes and turboprop airplanes," Boisture said. "We're investing heavily in this area, both in people and parts."
Hawker is working with aircraft lenders. Aircraft financing has been a challenge during the downturn, and unless a plane can be financed, a sale can't be made.
The company is "talking about the future of our company and the value of our products," to the lenders, Boisture said.
"Any loan is based on the lenders' view of what the residual value of that airplane is during and at the end of the loan," he said. "That's a pretty important piece, and that's a new capability of for us."
The biggest challenge of the year is the "continuous and clear communication about what we're doing and where we are and what the problems are and then just maintain a tight focus on the things we've said we're going to get done this year," Boisture said.
There will be distractions, he said.
"Some things won't work out like we planned," he said. "There will be distractions because new things will pop up."
But keeping a clear focus is the goal.