- The document discusses Rolls-Royce's lease engine pool and strategies for improvement. It aims to establish a consistent, world-class spare engine service for customers. - It analyzes customer satisfaction data and defects to identify areas for improvement. It also considers using on-wing care to reduce engine downtime and costs from post-lease checks. - The proposed improvements include overhauling processes, implementing firm engine status categories, improving fleet management, and gaining approval for changes from key stakeholders. The goal is to enhance service levels and maximize revenue from the lease engine pool.

1. Technical Support and OperationsRolls-Royce
Lease Engine Pool
Improvement Strategy
Michael Davies
April 2005

2. Technical Support and OperationsRolls-Royce
Mission
• To provide a world class spare engine
service that meets our customers
requirements (for standard, condition and
timeliness), without exception.

3. Technical Support and OperationsRolls-Royce
Engine leasing
FRONT
DESK
LED
Rates
STOBL
Transport
Insurance
Deposit
Lease offer
Lease request
Eng dispatch
Serviceable
engines
Requirements document (CRD)
Customer

4. Technical Support and Operations
Off wing management
Secure storage
Lease team
Fleet Ops OH Support
Campaigns
SV
Workscopes
Slots
OWC/SM
Post lease
checkLease Eng
Data Set
Aft Business
MEAROS
Policy
Process
Line main
Config
IP
Fleet planning
Pool sizing

5. Technical Support and OperationsRolls-Royce
Improvement planning
Scope Whole lease process
EBU policy T9/8/7/5
Additional services
Services culture Flowdown of attitude
Training
Satisfy stakeholders
Vision and mission
BR/AE strategy Transportation
Plan
Execute
Build in MQF
Previous awayday
Customer complaints
Embody RCP
Management study
StrategyBaseline

6. Technical Support and OperationsRolls-Royce
Objectives Establish consistent support
Develop whole process
Develop resource
Develop PPD
Define documentation
30/60/90 day achievements
Resource Identify people requirements Team size
Development planning
Plant H8
Equipment Database
Scanner
Fleet database
Problem database
FSO Monthly reports
Oversee post lease
Confirm packs
Communicate Intentions
Progress
Team/Ops/TSO/CBT/customers
Reengineer function "Spare engine services"
TargetsLinkCapability
Improvement planning (2)

7. Technical Support and OperationsRolls-Royce
Define KPI Operational
Business
Contractual
Customer satisfaction
Regulatory/quality
Feedback/control measures DMAIC
Identify best practice RRC
RRD
Wider RR
Benchmark
Competitor intelligence
Build in DMAIC Project 1
Future projects? > 6 months
RRCorp
Process
Excel
BenchmarkMeasurement
Improvement planning (3)

8. Technical Support and Operations
Identify and review top level functions
Identify and review sub functions
Review current processes Budgeting
(target mid year) Fleet planning LED in Fleet Ops tool
Fleet management SV/campaigns
Front desk engine leasing Out hours insurance/deposit
Engine movements Decision
Function
Invoicing
Post lease Map
Rework Workscope
Secure funding
Management
Inventory Manage
Store
Pool sizing New pool
Acquisitions/retirals
Existing pool
Documentation LEG
Awayday
Lease committee Review leases in period
Strategy
Lessons learnt
KPI's
aeromanager
Aftermarket (H Heuval) Embody policy on sub processes
Front desk/Fleet Ops
Activities Improvement planning (4)

9. Technical Support and OperationsRolls-Royce
Improvement programme

10. Technical Support and Operations
DMAIC (M)easure
Pareto of negative responses (out of 15)
0
2
4
6
8
10
12
Delivereytimeliness
AllDatacompleted
Otherinspectionsrequired
Customerrequirements
Sufficientdetail
NMSBcompleteandaccurate
Fullycertified
Unacceptableshortages
Modstandard(config)correct
Correctformatsused
ADlistcompleteandaccurate
Shortage/missingformcorrect
Deliveredontimetopromise
Engineratingcorrect
Enginemadeserviceable(RR)
Customerrequirementschange
Delivereyconditionagreed
Othernonconformance
Changestoshippinginfo
Conditionofengine
Leasetermsacceptable
RR/OWCmetexpectations
Accurate
Repeatboroscopeneeded
Allresponsibilitiesdischarged
FSOassistedpart2pack
Toldaboutnon-conformance
Leaseoffercorrect
Deliveredtocorrectlocation
Margincorrect
Question
Numberofnegativeresponses
0.00%
20.00%
40.00%
60.00%
80.00%
100.00%
120.00%
Number of responses
Cumulative percentage

11. Technical Support and OperationsRolls-Royce
DMAIC
• Defects per Million
Opportunities (DPMO)
• Measured against CTQC for
Lease Group input and output
– 238,710 input DPMO (σ = 2.2)
– 244,444 output DPMO (σ = 2.2)
– Defects delivered to customer
• 97.7% bad passes
• 2.3% introduced by Lease team
• Post lease check and
documentation by OWC

12. Technical Support and OperationsRolls-Royce
Improvement summary
• Review current operation – Containment
• Implement improvement scheme for 2005
– Process overhaul
– Service level
– Implement firm eng status – GO / NO GO
– Fleet management
– Pre or locally approved expenditure
– Rebrand - “Spare engine services”

13. Technical Support and OperationsRolls-Royce
5 – Manage Installed Equipment
5.6 Supply Lease Engines
Overall process ownership – Operations Room (TS&O)
Key deliverable – Delivery of lease engines within committed time-scales where contractually required
5.6.2
Determine most
appropriate lease asset
to use, based on
geographic, config
requirements
5.6.3
Generate lease rates
for use in STOBL
(or reverse STOBL) as
required
5.6.5
Launch lease engine
transportation logistics
Asses requirement
for On-Platform Care
intervention
5.6.6a
Instruct any workscope
requirements to
address configuration
issues
5.6.7
Ensure customer
delivers all required
lease engine group
paperwork
Update business
plan as required
5.4.3
5.6.1
Determine if lease
engine support is
required based on
contractual obligations
5.6.4
Execute STOBL with
Customer
Advise Aftermarket of
potential costs
5.6.6b
Generate workscope
requirements to
address configuration
issues and obtain
slot as required
5.6.8
During lease, ensure
customer maintains
accurate flying hours,
cycles and maintenance
information
Investigate
opportunities for On-
Wing Care
intervention
Process lead : Chris ComptonProcess owner : Rob Hill ASG 5.6
5.5
Technical Support &
Operations
Customer Business
Aftermarket
accountability
Regional
accountability
Overhaul
Support
accountability
Ops Room
accountability
Issue 1.2
Air En MarDef

14. Technical Support and OperationsRolls-Royce
Post lease checks - use of OWC
• Dissatisfaction (Customer Complaints)
– Missing components
– Incorrect documentation
• Engine downtime (ROI)
– Average 22 days to declare serviceability
– 65% LEDS finished
– 1% LEDS complete and accurate
• Replacement parts (Incremental cost)
– Non-recovered parts (MVP bags)
• Effect of alternatives is already known!!!

15. Technical Support and OperationsRolls-Royce
Cost of OWC – 2005
Cost of OWC per engine type
21%
17%
20%
20%
11%
11%
T500
T800
T700
524
535
Tay
OWC charges summary
Base Remote Parts $1,500 Averages Post lease $10,650
Pre-lease inspection $1,500 $2,200 Travel/subsistence $1,500 Pre lease $4,850
Post lease check $6,500 $8,800
Engine stand transfer $4,500 -
Additional cost prediction
Ops forecast
Installations $118,825
T500 T800 T700 524 535 Tay
Installations 14 8 9 9 5 4 Terminations $372,750
Terminations 7 6 7 7 4 4
Total $108,500 $83,300 $96,375 $96,375 $54,725 $52,300 $491,575 Total $491,575

16. Technical Support and OperationsRolls-Royce
Decreased eng downtime
• 10 day improvement on post lease service-
ability performance
– Currently 22 days
– With OWC 12 days (or better)
• Assuming 2 leases/ESN/year
– +20 revenue days or ~ 6% /ESN/year ($5000/day)
– 120 days on normal fleet (+1 lease/36% eng) ~$10M
– 340 days on large fleet (> 100% eng) ~$15M
– Pool size and flexibility

17. Technical Support and OperationsRolls-Royce
Engine condition
Post lease = NO-GO
• Post lease check
• Lease Eng Data Set (LEDS)
• Discrepancies addressed
• Secure storage
Pre lease = GO
• Transport
• Locate
• Storage
Discrepancies
- documented
- communicated
- written agreement
Intermediate condition = M.E.L.

18. Technical Support and OperationsRolls-Royce
Improvement scheme – buy off
• Communication & buy off
– Aftermarket (Exec/ABE’s/Finance)
– Regions (CS/Commercial)
– TS&O (Exec/Ops Room)
• Policies in place for major changes
– Post lease checks on large engines (Trent/RB211)
– GO/NO-GO engine status implemented
• Lease rate price increase
– Recover an amount of potential revenue
– Increased service level thru OWC
– Communicate

19. Technical Support and Operations
The End