SR Technics planted trees in Tree for Belgrade Challenge
Read the interview with Pierre Berthelot, Head of Product Management, who started his career within aviation more than 16 years ago and has very extensive and varied experiences in this field. This interview gives you an opportunity to learn more about his current role, the dynamics of the customer relationship as well as his person and passions.
Please tell us more about your career path and educational background. Why did you choose the aviation industry?
Pierre: This is a long story. I guess it all started with my father who is a private pilot. Having studied mechanical engineering, my world was more or less divided between what flies, floats, and rolls. As a student, I could explore various industries through projects and spent one summer at SNR in Annecy. We were producing the #4 bearing of an aircraft engine called CFM56. I was astonished by how much this industry relies on its people and how they passionately work on the aircraft. From there onwards, I made my career moves to remain in this industry where I feel so much at home.
When did you join SR Technics? Can you tell us more about your current role of Head of Product Management?
Pierre: Before joining SR Technics, I spent 4 years establishing a production plant in Casablanca, Morocco, from the ground, ramping up its activities, and leading the site. We were producing breaks sub-assemblies for the A320 family.
Later, I wanted to explore commercial roles and joined Lufthansa Technik Airmotive Ireland, Dublin, as Account Manager, where I learned about the CFM56 and P&W engine families, their maintenance, and ecosystems. In 2014, as the industry got hit by low demand for maintenance, the site was closed and I joined SR Technics, our fierce competitor back then with an impeccable reputation in the industry for quality, transparency, expertise, and on-time delivery. It was the right move for me, so today, as Head of Product Management, I lead a group of professionals in making and negotiating maintenance contracts with our existing and new customers and I’m all passionate about my job.
Which teams or departments do you cooperate closely within the company? How does this look like?
Pierre: Product Management is very closely connected with our Business Development colleagues, who are the ears of the customers - they convey and translate the customers’ perspective for us. We challenge assumptions, re-think problems, and find the best alternatives to be offered.
In this difficult endeavor, we heavily rely on the Customer Support Engineering organization who helps us analyze engines’ conditions, define the best work scope alternatives, and give advice to the customers.
We need the support from our Procurement team to provide the best competitive proposals, find the best replacement materials (often LLPs) on specific offers, but also to develop a strong supply chain, and get reliable access to Used Serviceable Materials.
Once the price is right, it is all about the cash. Customers want the service first and pay later, and in the current environment, there is an important risk if we accept to defer payments. For this, we obtain support from Credit Risk and Finance in general, to either obtain credit facilities or support from the Swiss government through their SERV program, which is quite unique in the world.
Finally, once the contract is signed, Account Management and Operations make it happen. So, by working very closely together, we make sure that both the contracts are fulfillable (also supported by Legal) and the standards produced internally are market conform.
When we at SR Technics say, “It’s all about the customer”, what does this mean to you?
Pierre: With the abovementioned interactions between departments during the bid process, the reader should come to the conclusion that the customer is at the heart of our processes. At SR Technics, each customer receives a completely tailored value proposition.
However, it does not stop there. SR Technics is agile to respond and react quickly to any plan changes or last-minute requests from our customers. The whole bid team that you’ve just read about, is committed to making it happen, even if it takes us long evenings.
Finally, we always say that it all comes down to communication. For me, this is where we place the customer - at the very center. We strive for transparent communication, ensuring that our partners do not leave any blind spots in our proposals and that they make the best decision for their fleets.
Is there any interesting, unusual or challenging customer case you would like to tell us about? Can you share some details on how the customer was handled?
Pierre: In the “Journey of an engine” video #1, I refer to a USD 1m saving. It has raised a lot of interest so let me expand on the story.
Our customer was an airline, a national flag carrier, very concerned with flight safety because any smoke smell in the cabin would result in a negative article in the local press. They were operating the A330 with the PW4168 (100” engines) and were under an exclusive maintenance agreement with SR Technics. During the take-off, an engine that did not have any maintenance yet at SR Technics had an inflight shut down due to a High-Pressure Compressor blade stage 5 that broke up into two pieces. It was located at the very front of the compressor and it heavily damaged all the blades and vanes downstream. They all needed replacement including the rotor which was also damaged. Luckily, the combustion chamber and the turbine were kept intact.
We inducted the engine to assess the exact extent of the damage and make an estimate for the customer to decide if they would invest in the repair. However, the engine was too expensive to be repaired (BER). Our Commercial and Procurement departments teamed up with our strategic partner for PW4168 materials to find a used module whose LLPs were matching the engine build. There was not much demand for it at the time so our Procurement stroke a great price for it. In addition, they agreed that the supplier (SR Technics) would overhaul the module, and it was all included in the final price.
We passed it on to the customer with our margin on the top, and as a result, the customer salvaged the engine, reached its quality objectives, and saved USD 1m.
Please tell us about your greatest achievement with SR Technics since you joined.
Pierre: From an inner perspective, I take the most pride in building inclusive and performing teams, which I achieved in Account Management (2017) and now in Product Management. As my boss Caroline Vandedrinck, SVP Business Development, often says, it is a team sport. We can only win together.
As for a more measurable achievement, the record sales in 2019, of USD 1.4bn is certainly an important accomplishment to me.
Talking about the business from Product Management perspective, what are your expectations or predictions for this year?
Pierre: Aviation is going through a deep transition right now, and it is quite difficult to take noise out of the signal, so that everyone can distinguish from wrong or right. There are global trends concerning environment protection and flight shaming, even more emphasized by the pandemic, to which some OEMs are reacting with heavy investments in green flying (hydrogen, synthetic fuel, battery-powered aircraft), and we, as a company, support this movement to protect our environment.
Airlines are struggling with cash management and sometimes need support from governments, which they obtain against promises to transform their operations to lower CO2 emissions. They are therefore incentivized in phasing in the newer aircraft models, such as the Airbus A320 neo and Boeing 737 MAX. However, I expect that there will be a very high demand for leisure travel because people have the real need for summer vacation after so many months of restrictions.
Evidently, commercial flying is still difficult in Europe and between continents, but it is easing up in other areas of the world, like the USA, China, and Japan, for domestic flights only. For these reasons, we currently see CFM56 (short haul) engines inductions from different airlines.
So, I do anticipate a strong uptick towards the summer and year end for air travel, in particular domestic flights, and it will result in an increased need for maintenance for CFM56 engines (5B and 7B). PW engines are mostly used for cargo operations nowadays and the demand for maintenance remains stable.
All in all, Q3 and Q4 2021 should see a clear rise in demand that should sustain in the medium term, so I am confident that SR Technics is serving a sustainable market.
Can you share with us how you spend your leisure time and what you do to stay fit and healthy?
Pierre: For the past 18 months, I haven’t had much leisure time as I was studying for an EMBA, which I completed end of May 2021. However, it helped me refocus on what matters the most to me, outside of work: my family, a handful of friends, and cycling.
I enjoy mountain biking and road cycling in the Swiss Alps. It is a great way to discover hidden gems of nature, keep fit, and develop perseverance.