SMARTER SKIES PROJECT BY AIRBUS - MODULE 2

SMARTER SKIES PROJECT BY AIRBUS 

Module 2: Company Innovation System 

2.0 Introduction 

In this module, I m going to explain Airbus's innovation system at company level. Firstly I will analyze  Airbus based upon  main characteristics of modern innovation management and then I will comment on several innovation model that Smarter Skies belongs to. Then I will continue by showing Airbus's internal innovation system and structure and also explain the main mechanisms. Lastly, I will conclude with final remarks on Airbus's overall innovation system.

2.1 Characteristics

In respect of analyzing  the Airbus Company according to the characteristics of “modern innovation management”, Airbus has close qualities to modern innovation characteristic. Therefore, we can easily bring forward that Airbus is a modern company. 

Beginning with 'purpose of innovation', Airbus include innovation as day to day business aganist to the traditional innovation characteristics which has exceptional innovation. Airbus's is operating in really highly competitive industry. Its' biggest competitor company is Boeing Company. Airbus and Boeing are the 2 giant leaders of aircraft industry. Boeing and Airbus are holding the big portion of the industry. The reason why they are big is they were first mover to the industry. Thank to that, they owned the biggest ratio of the industry and still hold it. In order to survive in this competition war especially against to Boeing, they need to go on developing their products without stopping. Airbus creates innovative thinking and focus on innovation as day to day business.

Secondly if we focus on the 'type of innovation', It can be said that Airbus has new systematic model innovation characteristic. In every situation they are faithful to their systematical design. If we turn our view to the automotive industry we can see that, car's engines developing systematically day by day. Engine development has mostly concentrated on energy saving and electric motor. Airbus make want to put aviation industry into this systematical and environmental innovation. By working on electronic motors systematically, they will increase their products quality day by day. When considered from this point of view, we can characterize Airbus's 'modern innovation management' is  systematical.

Thirdly we will turn our view to the 'implementation'. There are two type in implementation part these are; old model and new model. Old model contains Organization: unfreezing, changing, refreezing; dramatic turnarounds. New model contains adaptable organizations, continuous change and self improvement built in. Airbus has modern new model innovation management. Airbus has continuous improvement and built in transition and change. Airbus’s ability to swiftly transform its business model by focusing towards the developing needs of its customers and suppliers. When examining the Airbus Company's history¹; the A300 became the world’s first twin-engine wide-body jet with its commercial service entry during 1974.  It was followed in the early 1980s by Airbus’ shorter-fuselage A310 derivative, then later that decade by the company’s single aisle A320 which has developed into one of the most successful aircraft families in history with the A318, A319, A320 and A321. The 1990s saw Airbus introduce its long-range A330/A340 Family, and a new era of airline travel started in 2007 when the 600-plus-seat A380 began commercial operation. Responding to market requirements, Airbus launched its A350 XWB twin-engine jetliner in the 2000s. The highly-efficient aircraft entered commercial service in 2015, bringing together the very latest in aerodynamics, design and advanced technologies. Airbus continues to invest in improvements across its market-leading, modern product line – including development of the A320neo (new engine option) version, the A330neo variant and more. The company’s international production network also has been significantly expanded over the years. The last but not the least, Airbus announced Smarter Skies. By looking at this impressive and innovative history, the company is a really good example of new model, modern innovative management.

Fourthly we will analyze the 'strategy'. Airbus is more modern, technological and different than it's competitors. It's top competitor Boeing is also developing modern projects but what Airbus doing is really diversified from it. Airbus's 'Smarter Skies' and 'The Concept plane projects are so technological and unique projects that we can not see at other competitors. At this point, Airbus' strategy is this, creating high technology and unique projects and it will patronize them by making them leader company in the future.

Fifth point is 'secrecy or in network'. Lets begin with describing the old and new model modern innovation management. The old model is; secrecy, closed and within company. New model is; open, in networks and open source. Airbus is open source and in networks company. Because managers of the Airbus's company have remarked at interview that they are ready to work together and share technology with other companies. Managers remarked that they want to cooperate with other aviation companies while developing Smarter Skies project. Of course it doesn’t mean that the company is fully open source. They are ready to open source only if they accept to cooperate Smarter Skies project with them. However, we can state that the the Airbus' modern innovation management characteristic is new model, that is open source, in networks.

Sixth point is 'significance' of innovation. We will analyze Airbus on two point, one of them is old model that is innovation as business of R&D and the other point, new model that is innovation as everybody's business. The airbus company uses old model which is using innovation as business of R&D. They have to use this system because of the hugeness of the company, products and market. It s not like Amazon or Walmart to have new model. Other department could come up with brilliant ideas at Amazon and Walmart because usually it doesn’t need hight technology. However if we look at Airbus Company it is completely different, innovations and development are the business of R&D department. Because the products of Airbus are high technology and the safety of those products are really important because they are flying people. If ıt's airplanes crashes based upon to faulty product and technology, the company will have major difficulties, get reactions and finally it will start hitting company financially. Due to these reasons, Airbus Company innovate and develop their products with R&D department.

2.2 Innovation Generation

In this part we will analyze Airbus Company in question framework. That is; did this innovation appear from a technology-push model, from a market pull model, from an interactive model, or from open innovation? Airbus's Smarter Skies project can be seen to appear from an interactive model. Airbus's Smarter Skies project is a combination of market pull and technology push  model. s figure it out those two model. Let's figure it out those two models;

Technology push model:

The schema at the top shows briefly how the 'technology push model' process is. It first stage is scientific exploration, then developing this exploration for their products and moving to next stage to the production and finally sales. Airbus used this technique for some of innovations in Smarter Skies. For example; express skyways and eco climb. At express skyways it brings forward really futuristic thing: In the future, highly intelligent aircraft would be able to “self-organize”² and select the most efficient and environmentally friendly routes (“free flight”) making the optimum use of prevailing weather and atmospheric conditions. High-frequency routes would also allow aircraft to benefit from flying in formation like birds during cruise bringing efficiency improvements due to drag reduction and lower energy use. This express skyways innovation is definitely technology push model because there is no such need in the market. The Airbus company explored that and now working on its development stage. 

Demand pull model:

In demand pull model R&D departments start from market demand. That is the most important stage of this model. Because if they don understand what the market demand is, their innovation wont get positive return from consumers. The other stages are; development, production and sales as you can see on top. Before start working on Smarter Skies project, Airbus made surveys in order to understand what the market demand is. At the interview³ with Airbus’ Executive Vice President of Engineering Charles Champion highlights findings of a two-year global survey to assess what passengers want from flying in the future. Results underscore a desire for more sustainable operations, as well as less stressful flights for passengers. In addition, 63 per cent of participants said they will fly more by 2050. And there is the statistical table of the survey that Airbus Published⁴ ;

2.3 Systems and Structure

The Airbus Company divides investment in innovation into two categories. These are;⁵ Research and Technology (R&T) and Research and Development(R&D). The R&T department investigates early stage technologies. R&D department leverages these technologies to develop groundbreaking products and services. Environmental efficiency is a particular focus, accounting for more than 80% of R&T spending at Airbus. Every year, the Group spends more than € 3 billion on R&D. In 2014, € 3.39 billion was invested in self-financed R&D (2013: €3.16 billion). Equating to more than five percent of revenues, R&D spending finances the development of major new programs such as the A350 XWB and A320neo.