A chat with Executive Vice President Dr. Thomas Rupp
Dr. Thomas Rupp was born in Aachen and grew up in Wachenheim, in the German Wine Route in the Rhineland-Palatinate. His first experiences abroad were when he was only 16 years old, as he spent a year in Kokomo, Indiana in the US as part of a student exchange program. Then, after graduating from high school, he did his military service, where he first came into contact with the field of aviation at the US Air Force base in Frankfurt, Germany as a mission first aid instructor during the United States’ “Desert Storm” operation in 1990.
Thomas Rupp went on to major in mechanical engineering, with a focus on production engineering, at RWTH Aachen University. In 1995, he attended Imperial College London for a full year as part of the Erasmus Program, and met his future wife there before also spending some time abroad in Italy. Finally, he went back to Imperial College to get his PhD, where he focused on optimizing the flow of information in supply chains.
Rupp started his professional career at Fairchild Dornier in Munich, where he reported directly to the SVP of Supply Chain Management and was responsible for the area of e-business. Unfortunately, the company went bankrupt, after which he switched to MTU Aero Engines in Munich again and started off as an e-business project manager before becoming senior manager of production planning. Then, in 2006, he was tasked with selecting a production location in Eastern Europe as part of a project by the company’s board of management. That MTU location is still in Rzeszów, Poland, and today employs 1,000 people.
Two years later, Rupp moved on to Snecma (today’s Safran Aircraft Engines), where he played a part in setting up the supply chain for the SaM146 engine. Three years later, he would supervise the implementation of a material service agreement with Lufthansa Technik for CFM before becoming an official Safran and CFM representative for Airbus in Toulouse two years after that. Finally, before joining HYDRO as the general manager for France in November 2019, he was the VP of Customer Support Management at Safran, and had 30 customer support managers report to him worldwide. And now, Dr. Thomas Rupp has been the head of our new Tooling Business Unit since November 1st, 2020.
Dr. Thomas Rupp is 49 years old, married, has two kids aged nine and ten, and lives with his family in the 13th arrondissement of Paris.
HYDRO is in the middle of an internal restructuring and realignment process. What’s the reason for that?
Well, one very significant factor, of course, is the Covid-19 crisis. The pandemic is forcing us to reevaluate things and do them differently where appropriate. The demand has collapsed worldwide due to the fall in air traffic and that our capacities are not being used to their full extent. This gives us the opportunity to really think about some issues more carefully. In the past few years, there really was only one focus in the aviation industry: growth, growth, growth. And among other things, this meant that we didn’t really have time to think about where we wanted to get to in the first place. In fact, we didn’t even have time to really process that huge growth and really tighten and fine-tune our processes.
Now, the crisis has helped us speed up certain realizations. We’ve realized that we need to focus much more on the market instead of just expanding our product portfolio constantly and having our activities, duties, and structures grow somewhat uncontrolled.
We’re now shifting our focus at the topmost level to our customer segments, and very heavily so. For instance, we’re setting clear organizational boundaries between Ground Support Equipment, Tooling, and Service, and are revising our processes and modifying them in line with the specifics of our clientele. But that’s not all: We’re also taking a look at the roles that the various team members have in their positions, and it’s really something that we want to define and delimit more clearly. All in all, this will make us more effective and efficient, but also, and perhaps most importantly, much faster.
Now, the way I put it might sound a bit trite, but we really see this as an opportunity and are working on taking full advantage of it and of the time that we have now.
How do you think HYDRO will benefit from switching from a line organization to a business-unit-centered organization?
We’re not only getting rid of silos, or, better put, conventional departments, but we’re also replacing them with new structures that are cross-functional and revolve around our customers. So you could say that we’re becoming more customer-focused, but I think “market-focused” is an even better description. Basically put, when it comes to the big picture, we’re leaving the “we do everything in a huge organization” approach behind, and are instead organizing and delimiting our internal operations based on customer segments and product groups. As you all know, this means that we’ll have three business units: Ground Support Equipment, Tooling, and Service.
Let’s take GSE as an example to look at things more closely: That business unit will be taking care of everything that is our own intellectual property, or IP. And as you can probably intuit, that takes a very specific type of customer relationship. When it comes to GSE, you need to analyze what the market really wants in the very long term. And, of course, what our long-term developments for the market should look like. This is something that spans a period of years and requires working closely together with end customers such as Airbus and Boeing.
Meanwhile, things are completely different at the Tooling Business Unit. We have a very limited influence on IP there, which brings me to the most important distinction: In contrast to GSE, we’re not talking about our IP here, but about our customers’ IP instead. This means that Tooling gets drawings and specifications directly from customers and needs to work with that. Needless to say, that’s a completely different approach and way of doing things. And if I were to go into our Service operations in detail, we’d find yet another completely different way of doing things.
Now, by separating and delimiting these business units, we’re making sure that our individual business units will be more efficient and able to respond to our customers’ needs more quickly. In fact, this should enable us to really focus on the core activities of each business unit.
For example, time, cost, and quality are the most important parameters for the Tooling Business Unit, and the new structures will make it much easier for us to optimize things along those lines.
„The crisis has helped us speed up certain realizations. We’re now shifting our focus at the topmost level to our customer segments, and very heavily so. “
Executive Vice President Tooling
What does your new position look like?
Right now, I’m responsible for taking the new organizational structure that we’ve worked on for months and implementing it at my business unit. So to put it basically, we need to get the whole team on board so that everyone knows exactly where we’re headed. Now, needless to say, that’s a process that will take a while and will be with us for weeks, or even months, and this makes it really important for me to clarify to our team members just how these changes will improve things and what the goal behind them is. And that’s not just for our biggest location, that is, the one in Biberach, but also for all our other locations worldwide. In fact, these global locations will have a much closer connection to headquarters in the future! All in all, each business unit manager needs to put together their new team, get everybody on board, explain what our vision is, and convey the message that we’re confident that we’re on a good path.
Having said that, what we’re doing right now is preparing for the moment when demand rises and we’re working at full capacity once again. After all, we want to be fast, effective, and on the ball when things speed up again, and we also want to increase our market share in a sector where competition is incredibly tough, but in which we can also assume that our competitors will not dare tackle this head on like us. Of course, this also means that our restructuring process comes with some pretty big investments.
So does this mean that the Tooling Business Unit will grow?
Well, I am personally taking care of two key account management positions in my new role for now. One for MTU, Pratt & Whitney, and Japanese Aero Engine and another for GE, CFM, and Safran. And I have somewhat of a head start there, since I come from Safran and also worked at MTU at one point. I’m familiar with both worlds. Now, what we need to do right now is to build things up in these areas, and to tell you the truth, we’re just getting started there. But I think that I can contribute in a very significant manner by bringing in my longtime contacts. What it really comes down to is customer relationship management, or establishing long-term contacts, if you will. That’s what will form the basis for future growth in the tooling segment.
What are the factors that will really define whether the new business units are successful or not?
From my perspective, there are several factors that play an important role here. On one hand, we basically need to “perform.” In other words, we need to establish clean processes that allow us to pursue our objectives quickly and systematically. These objectives need to incorporate the right quality, price, and lead time for our customers. Basically put, our vision for 2024 is for the market to consider that HYDRO is simply indispensable. That’s the benchmark. But we’re not there yet. Just like our competitors, we’re not extraordinary if you really look at things objectively. Now, we’re not bad, but we’re also not good enough.
That’s the foundation we need to establish. But in a world in which long-term relationships are absolutely crucial, just limiting ourselves to that foundation won’t be enough. That’s why customer relationship management is also a definitive factor. What we need is the chance to prove ourselves to new customers so that they get that eureka moment, and that’s why direct contact with customers is absolutely crucial as far as I’m concerned.
"Our vision for 2024 is for the market to consider that HYDRO is simply indispensable. That’s the benchmark. But we’re not there yet. "
Executive Vice President Tooling
In the future, HYDRO plants across the world will be competing with the supply chain. What’s the idea behind that?
When it comes to tooling, we’re already making up to 90 % of certain product lines in-house. But we’re also sourcing up to 90 % of other product lines from third parties and are working closely together with our suppliers worldwide. This won’t really change that much at the new Tooling Business Unit.
In contrast, things will change considerably at the Ground Support Equipment Business Unit, and our plants will have to compete much harder with our suppliers in the future there. As we all know, competition gets things moving, and that’s something we want to take advantage of. It goes without saying that this will be a challenge and that our plants will really have to show what they’ve got.
What are the key areas of the Tooling Business Unit for which you are responsible?
One key area is definitely what we’re calling “industrialization”. Now, we’re using the term differently from how it’s normally used, so it’s worth explaining what we mean by it: As I already alluded to, tooling is a traditional make-to-print business, which means that we manufacture products based on our customers’ drawings and specifications. However, the documents we usually get for making a tool are rarely adequate for production and so can’t really be passed on directly to our supply chain or our production operations. In other words, we usually need to clean up and prepare the corresponding data first.
Now, at HYDRO we have the know-how to assess whether something can be made or not. One example: Most drawings don’t point out the various standards that nevertheless apply and that we are implicitly assumed to adhere to. However, our decades of experience mean that we know this and can pass on the document with this additional information to our supply chain or production operations. But not just that information – we can also determine which materials need to be used and which testing standards need to be applied. That really is one area in which our expertise is extraordinary, and it really makes sense that the members of our Industrialization Team see themselves as “translators.”
The second key area is portfolio management, which is responsible for the various portfolios, such as an engine portfolio and an aircraft model portfolio. Since our tooling customers really organize themselves on the basis of portfolios, we’ve decided to implement the same structure internally. The Portfolio Management team at the new Tooling Business Unit is where all the important threads will converge and be held together. And if you’re curious about the difference from product management, it’s simple: A portfolio manager is responsible for a large number of tools for a customer’s end product, while the number of products for a product manager is usually kept within a certain limit.
Portfolio Management is the brain of the business unit. It sets prices and costs systematically and will ultimately be the deciding factor in whether we are awarded contracts or not as a business unit.
After all is said and done, how will our customers benefit from our new organizational structure?
Customers don’t want to worry about what it means to produce a tool. They basically want to order it and get the end result. And that’s what we’re ready for. By taking care of the complexities of tooling for them, we’re making it possible for them to focus exclusively on their core business. Now, tools really vary a lot, and you get tools for a couple of hundred euros to tools for several hundred thousand euros, as is the case for an engine bootstrap, for example. This type of variety means that you really need a lot of expertise and production know-how, and that’s exactly what we have. And everything with fairly large volumes – we’re talking just under 400 tools per engine portfolio.
But to get back to your question directly: Our customers will benefit from our new organizational structure as a result of us really focusing on our customers, which will enable us to ultimately know our customers more in depth and be more able to align ourselves with their needs. What we particularly expect to improve in this context is our delivery performance. And with a focus on industrialization, we’ll also improve our level of quality significantly.
CLOSE-UP WITH DR. THOMAS RUPP
A good day at work starts with …
a good cup of coffee and, if possible, a short run.
The first time I earned money was …
harvesting grapes at a vineyard, or what the Palatines call “Herbschde.”
If I could choose my seat neighbor on an aircraft …
it’d be my wife on a very smooth flight, as she’s unfortunately afraid of flying. Otherwise, it’d be Angela Merkel, the German Chancellor. I’d love to learn more about what it’s like to negotiate with French President Emmanuel Macron.
I lose track of time …
when I’m sitting at the table and take out the cheese, red wine, and baguette as the last course of the meal. My family tells me that I’m relaxation personified when that happens and that I forget everything around me. I really discovered what cheese has to offer in France and enjoy buying cheese from the cheesemonger at the market. There are amazing cheeses with all kinds of flavor profiles!
The most expensive thing I’ve ever bought in my life ...
my apartment in Paris.
I have always …
dreamed of getting a pilot’s license.
If you want to get somewhere at HYDRO …
you need to be a master of helping other team members really grasp just how important every individual project is for our customers. That way you can get people who will give it their all with you and together be successful for our customers.
When I was 18, I wanted to …
be an archeologist.
To me, home is …
where my family is, so it’s not a specific physical location.