Service and Operations Management

EADS Defense & Security Supply Management

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In 2009, EADS Defense & Security, the second largest division of EADS, decides to change its supply management strategy. The Chief Procurement Officer of EADS D&S faces the challenge of implementing a new governance model, define a new organizational structure and develop a new divisional sourcing strategy that is aligned with EADS sourcing objective. In doing so, he has to take into account the challenges of working in a very complex, historically grown and multi-national company. Furthermore, EADS D&S source from a supply base of more than 20,000 suppliers accross the globe. Finally, EADS D&S also faces legal and political constraints such as countertrade agreements between EADS and its global customers.
Bibliographic citation: Sachon, Marc; Granero, María; Suzar, Noah, "EADS Defense & Security Supply Management", IESE, P-1105-E, 11/2011
Date: 07/11/2011
Author(s): Sachon, Marc; Granero, María; Suzar, Noah
Document type: Case
Editor(s): CIIL - Centro Internacional de Investigación Logística
Department: Production, Technology and Operations Management
Sector: Industry and Manufacturing
Languages: Spanish / English
Year of the events: 2008
Geographic area: Germany; Spain; France
Learning objective The case allows students to gain insight into sourcing and procurement in large multinationals. Furthermore, it adds a dimension of complexity by having students discuss the intricacies of political and legal constraints present in the aerospace and defense industries. The case allows a rich discussion of the difference between abstract solutions that seem to present themselves (e.g., supply base reduction) and the challenges of implementing these in an environment of political and legal minefiel.