Aerospace as an industry is a contradiction. On the one hand, it’s as far-reaching as the winged carriages that exemplify it. Jobs are split between land and air, but the majority remain on solid ground.
And just as air travel has made the world a smaller place, the aerospace industry is itself a small village that happens to be home to some very big villagers.
Working at an industry giant like Boeing, the footprint is so large that one’s CV can be wonderfully diversified without ever leaving the company. For Justin Franke, Managing Director of Aerospace Composites Malaysia (ACM), that’s a plus.
“I was with Boeing for 26 years, and one of the great things is that you get so many different job assignments. There’s always an opportunity to learn,” he says.
And now at ACM, Franke’s education continues. A 50–50 joint venture between the Boeing Company and aerospace carbon fiber specialist Hexcel, ACM manufactures structure composite bond assemblies and subassemblies for Boeing’s commercial aircraft.
The 47,200-square-meter factory in Bukit Kayu Hitam, in the Malaysian state of Kedah, sits on an even more impressive 120,700-square-meter site. This kind of space is crucial for producing the 18,000-odd aerospace parts supplied by ACM every month, from fixed-trailing edges to rudders and fuel doors.
Even to Franke, who served on ACM’s board of directors for three years before formally joining operations in Malaysia as Managing Director in 2019, the scope is impressive.
I was with Boeing for 26 years, and one of the great things is that you get so many different job assignments. There’s always an opportunity to learn.
“I was pretty familiar with what was going on at ACM, and at the time we were doubling ACM’s revenue and workload through a major work transfer,” he says.
The transfer of 890 new assemblies to the ACM site was quite an undertaking. “It was one of the biggest work transfers I’ve ever seen during my career in supply chain.”
But thanks to factors beyond his control, Franke’s maiden voyage at ACM was almost grounded before takeoff.
“I arrived at ACM in November of 2019, and we’d had the second 737 Max crash,” he says. “That was a difficult time because 737 production rates were down.”
The imminent arrival of the COVID-19 pandemic further compounded those difficulties, causing Franke and ACM’s leadership to make some very difficult decisions in order to weather the downturn.
“In 2020 we reduced 504 jobs,” he recalls. “That was a very difficult time. We had several work stoppages where we shut down the factory for three-to-four weeks at a time. Our employees were extraordinarily supportive, however, and they knew we’d come out stronger.”
Basically, my first year, which I thought would be onboarding a lot of work and boosting production rates, became a requirement to restructure the business.
The difficulties of the aerospace industry are well known to its denizens.
“They knew that in the good times they were treated very well, and during difficult times that allowed them to remain supportive. That’s something I’m really proud of,” Franke says.
“It wasn’t the assignment I thought I had when I first arrived. Basically, my first year, which I thought would be onboarding a lot of work and boosting production rates, became a requirement to restructure the business.”
The key lesson of this very different experience was to increase communication.
“Effective communication helped employees understand, accept and support our decisions,” he says.
“Even if you think you have enough communication, communicate more. Be transparent and honest, and even when there’s information you can’t share, go ahead and let people know you can’t share it. Building trust through communication helped us greatly through that time.”
When you work together and you have transparency and honesty, and you’re direct with each other, you grow the relationship.
Also keeping pandemic turbulence under control was ACM’s relationships with its supply chain. As a former Director of Supplier Management for Boeing, Franke is well versed in long-term relationship management.
“When you work together and you have transparency and honesty, and you’re direct with each other, you grow the relationship,” he says. “There are some very difficult production challenges and economics that can arise, but having an open and honest mindset as you go about dealing with these situations will create better partnerships.”
ACM’s fortunes have bounced back since those early days of Franke’s tenure. The pandemic-induced pause meant many grounded aircraft received extensive maintenance, a need ACM’s output was easily able to meet.
At the same time, ACM embarked on a robust cost reduction process under Franke’s watch. “Companies go through ups and downs. It is challenging to do cost reduction when production costs aren’t stable,” he says.
We want to pay a little bit above market, and we want to have huge bonuses.
“You also can’t have a robust cost improvement program unless you have great employee engagement. Being able to involve everyone and make sure there’s alignment and understanding that we’re trying to reduce costs, and how that benefits them and other stakeholders, is critical.
“It’s not an initiative, it’s what we do every day. We manage it and spend time on it.”
That effort has paid off. In 2022, ACM’s team garnered the highest revenue in the history of the company. “We’re so proud of that. We want to pay a little bit above market, and we want to have huge bonuses.”
That ties into one of ACM’s goals for the year: becoming one of the best manufacturing companies to work for in Malaysia.
“We’ve looked at what some of the leading companies in Malaysia have done and discuss frequently as a leadership team. We want to give our team a chance to beat the business plan set by our board of directors.”
After almost four years in the role, Franke himself has developed and refined his approach to leadership. One of his key realizations during that time was that a job title doesn’t make someone a leader.
People follow when they know whoever’s leading is a genuine person, and that there’s genuine care.
“A leader can be anyone, but you need different strengths and attributes depending on what you’re trying to lead,” he says. “People follow when they know whoever’s leading is a genuine person, and that there’s genuine care. I think that’s what people are looking for.”
A good leader, he adds, sets higher aspirations and employs the right communication to direct their team to that goal.
“It’s about saying ‘yes, we can’,” he says. “We might not know right now how to do it, but we have a great team and we’ll find a way to get there.”
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