Boeing Frontiers
August 2002 
Volume 01, Issue 04 
Top Stories Inside Quick Takes Site Tools


Integrated Defense System

Jim AlbaughOn July 10, Boeing announced the merger of its Space and Communications and Military Aircraft and Missile Systems businesses into a new organization, Boeing Integrated Defense Systems. One of the world’s largest space and defense businesses, IDS leverages more than five decades of expertise and the ingenuity of 78,000 employees around the world to provide systems solutions to its global customers. Organized around its customer base, the St. Louis–based IDS is a $23-billion-a-year business.

Leading the new organization is Jim Albaugh, president and CEO of IDS, formerly president and CEO of Boeing's Space and Communications business unit. Frontiers caught up with Jim recently to get his thoughts on the new organization and the benefits it brings to customers and employees.

Q: Why did Boeing decide to merge its space, communications and military businesses ... and why now?

A: Over the last several months [former Military Aircraft and Missile Systems President and CEO] Jerry Daniels and I, and a few others, have talked with Boeing Chairman and CEO Phil Condit about the value in bringing together the two organizations in order to create an integrated business unit that provides one "face" to our customers. With some recent program wins such as Future Combat Systems for the U.S. Army and the Joint Tactical Radio System, Phil and the Boeing Board of Directors felt that this seemed like the right time to bring together these two businesses. This gives us the opportunity to create greater horizontal integration across the business and provide systems solutions for all of our customers, leading to more opportunities to win future programs and continued growth as a space and defense business.

Q: What value does this bring to customers? To employees?

A: First, our customers will no longer have to talk to multiple people from different business segments but can now easily find the right people to get what they need. And, as a customer-facing organization, our new structure looks more similar to theirs. We've talked to our customers about this, and they are all very positive about it. They applaud our decision to be more focused and aligned with them. Their only concern is that as we transition to this new organization we don't lose focus on the execution of our ongoing programs.

For employees, I think this brings tremendous opportunity. This new structure encourages employees to think a little more broadly about their work, and how what we do across the business is interrelated. We have some of the most talented people in the industry working on our programs and products, and we're going to continue to tap into this talent through our process councils, strategic business councils and centers of excellence, which will facilitate horizontal integration.

Q: Why was St. Louis chosen as the new headquarters? Does this mean that Southern California operations are going away?

A: St. Louis was an obvious choice for several reasons: It's centrally located and allows us easy access to our businesses across the United States, including Boeing World Headquarters in Chicago and our customers in Washington, D.C. But there are other reasons for choosing St. Louis. The city has a great heritage in space and fighter aircraft, and enjoys terrific bipartisan political support, making it a great place to base a $23-billion business.

But in no way does this mean that Boeing is leaving California. Of the 78,000 employees who are part of IDS, nearly half—about 37,000—are based in California. Four of our major businesses will be located in the state: Air Force Programs, Homeland Security, Launch and Satellite Systems and Space and Intelligence. Some of our leading systems integration programs were captured by our workforce in Southern California. We'll see more jobs created in the region as these programs continue to grow and mature. Some of the IDS functional staff will continue to be located in Seal Beach, and Bill Collopy, vice president and general manager for Launch and Satellite Systems, will serve as the state executive.

All across IDS there is tremendous opportunity for growth, and I think it's an exciting time for us— whether you're in St. Louis, California, Philadelphia, Arizona, Texas, Australia or any of our many other locations.

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