No. 15: Restructured IDS lets Boeing help clients

The Boeing Co.

Prime IT contracting revenue: $912.7 million

Location: Chicago

Leader: W. James McNerney Jr., chairman, president and CEO

Employees: 153,000


2005 revenue: $54.8 billion

2005 net earnings: $2.6 billion

2004 revenue: $52.5 billion

2004 net earnings: $1.9 billion

W. James McNerney Jr., Boeings's chairman, president and CEO

Rick Steele

The Boeing Co.'s Integrated Defense Systems unit is reaping the benefits of defense transformation programs, such as Future Combat System and the P-8A aircraft, and strong international sales to grow its business. The IDS unit, which Boeing created three and a half years ago to serve the Defense Department, came in at No. 15 on this year's Top 100, with $912.7 million in prime IT contracting revenue.

Boeing IDS, which also works on programs such as the F-18 and C-17 aircraft, pulled in $30.8 billion in revenue in 2005, $3.9 billion in earnings and $915 million in prime contractor dollars. The unit now has more than 75,000 employees.

As a result of a recent restructuring of Boeing IDS, the next few years should be even better, said Chris Raymond, IDS vice president of development.

In January, operations were organized around capabilities and consolidated into three profit-and-loss centers: precision engagement and mobility systems, support systems and networks and space systems. The unit's advanced systems capabilities were moved under one president and will help IDS "transition new technologies into the other three businesses," Raymond said.

Boeing IDS restructured itself as several customer-facing organizations. The new structure, Raymond said, came about after Boeing recognized the Defense Department's push toward more joint and capability-focused programs, most recently noted in the Quadrennial Defense Review.

"We wanted to get ahead of that a little bit, as we've seen the customer shift in that direction," he said. "It makes it easier for us to draw on the best of Boeing across these capabilities, then make them available either for new programs or for insertion into programs."

The new structure will help Boeing's military satellite programs, which were challenged last year by difficulties in scheduling, scope, growth and funding instability. With the new capability-based network and space systems center now serving these programs, Raymond said, "we've sharpened our focus, increased the frequency of communications and streamlined accountability," which makes it easier for the customer to work with Boeing, and lets Boeing stay focused on execution.

Support and logistics are areas of growth for Boeing, Raymond said.

The Iraq war also continues to consume resources, forcing the Defense Department to choose between transformation programs and incremental improvement of existing programs, either by network-enabling them or modifying them to afford more utility in a joint warfighting environment, he said.

The latter "will all turn into modifications and upgrades, so we continue to see a lot of potential in that part of our business," he said.

In addition, as fleets have grown, so has demand for Boeing products, such as the C-17 Globemaster, the V-22 Osprey tilt-rotor aircraft (built by Boeing and Bell Helicopter Textron Inc.) and the P-8A multimission, maritime fighter aircraft. As the aircraft come online, they'll need contractor support, something that Boeing is fully prepared to provide, Raymond said.

Additional 2006 Top 100 Profiles
  • No. 1: 12 times the fun for Lockheed

  • No. 2: Northrop takes aim on health IT

  • No. 3: SAIC prepares for public debut

  • No. 4: Revving the acquisition engine

  • No. 5: CSC holds a lure for a buyer

  • No. 6: Raytheon works the system

  • No. 7: L-3 cuts bigger slice of govt pie

  • No. 8: For EDS, steady as she goes

  • No. 9: Booz Allen adapts to stay on top

  • No. 10: Dell solutions get superpowered

  • No. 11: BAE keeps acquisition fires burning

  • No. 12: Despite sale, Anteon's vision lives on

  • No. 13: Intelligence work fuels CACI's growth

  • No. 14: Verizon-MCI combination packs a punch

  • No. 15: Restructured IDS lets Boeing help clients

  • No. 16: ITT Industries aims for the sweet spot

  • No. 17: IBM Corp. steps up as a subcontractor

  • No. 18: Sprint Nextel goes for convergence

  • No. 19: For SRA, the profit is in its people

  • No. 20: It's always mission possible for Unisys

  • Overview: The Billion-Dollar Club

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