Swedish defence company Saab has a heritage in digitisation going back to the 1950s, and is now configuring its IT function for the future to balance standardisation with “openness, flexibility and agility”, according to its CIO, Mats Hultin.
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Hultin has spent a quarter of a century at Saab, and has been
“We have a good chance for global growth, but we are still a Swedish organisation in many ways,” he said in a more recent interview with us. “We are also quite a small company compared with competitors like BAE Systems, so we have to be very used to working with partners and being flexible. We don’t have specialists in every geographical area of the group, so we need to collaborate globally, and we needed a platform for that. Hence the reorganisation.
“We used to be a transportation company. Many years ago, we had cars, trucks and aircraft, but then we decided to consolidate in aerospace and defence. From that, we got more and more international subsidiaries, and now have a footprint in more than 33 countries.”
Hultin draws attention to the innovation exemplified by the firm’s new airborne surveillance systems, which he describes as “high-end, state-of-the-art technology in that business area”, and to the 2014 acquisition of Swedish company Kockums, which has at its fore “one of the most modern submarines in the world”, the A26. The Gripen fighter aircraft has also been a popular export, he points out – Brazil bought 36 of them in 2015, for instance.
The United Arab Emirates signed a contract with Saab for the airborne security system, for a new aircraft, the Bombardier 6000, in November 2015, according to its annual report published in 2016.
Domestically, in conjunction with the Swedish Air Navigation Service Provider (LFV), Saab has introduced a “remote tower” system for air traffic control which virtualises the work of controllers.
Indeed, Sweden is the first country in the world to have a remotely controlled airport using the system. It makes it possible for air traffic controllers to control air traffic at Örnsköldsvik airport from Sundsvall airport 150km away. Remotely operated cameras and sensors are placed at the airport and high-definition images and relevant information are transferred in real time to the air traffic control centre.
Digital air traffic management
The air traffic controllers have the same view and get the same information in the control centre as they would in the tower. Another Saab company spokesperson added to Hultin’s explanation: “The concept enables new tools and features, such as enhanced situational awareness, object tracking and alerting, night vision and image enhancement. This provides the air traffic controller with a better decision basis than a conventional setup. The digital air traffic management concept also enables one air traffic controller to manage multiple airports by switching view and flight information from one airport to another, which significantly improves staff efficiency.”
Hultin adds: “So our company strategy is to capitalise on all these innovative investments through partnerships, being open and collaborating with the countries we sell our products to.”
Business applications supplier IFS, also based and founded in Sweden, is what Hultin calls a “strategic” supplier for Saab. “Quite a lot of our processes are supported by the enterprise resource planning (ERP) system from IFS. We also have had a good, long-term relationship with them and are business partners with them in some areas for our customers. So, if Saab customers need an integrated MRO [multi-region operation] system, or similar ERP setup, we have a partnership with IFS to be able to offer that.
“It goes back many years. I would say the idea of this partnership started when we introduced IFS to our aeronautics business about 10 years ago.”
IFS is not Saab’s only strategic – as opposed to merely transactional – IT supplier. CSC and Indian IT services company TechMahindra are two others. Saab has a research and development centre for application development and management with the latter in India.
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As regards IFS, Hultin values the so-called “layered architecture” at the heart of the supplier’s most recent suite of applications, IFS Applications 9. This means the code is organised in layers. From Saab’s point of view, his fits in with its wish to balance standardisation with agility, says Hultin. “The layered architecture is important here – it is absolutely the right direction.”
The past and future context of IFS software adoption at Saab is that “we have had a lot of best of breed and saw a need to cut costs and reduce complexity”, he says. “So 150 legacy systems were replaced with IFS installs. But there will be much new best of breed in the future and if you have built in an overly robust kernel and cannot integrate those, you will have a problem in the future.
“The platform therefore needs to be open, and open to cloud integration too, to be able to interface with other systems.
“We are making use of cloud and want to make more. The benefit of cloud would be operational efficiency and cost, but more and more long term, being able to connect and access the data globally. But we have all the problems you could put on a PowerPoint slide as challenges – export control, data protection, cyber security, national security, and so on. So we need to be very specific and have fine-grained control.”
Saab has 300 IT employees, which represents 30% of the function; 70% is outsourced above that.
Fast and agile across the world
Hultin says control of the financial cost of IT and the compliance demands of an industry with a lot of demands for safety are his baseline as a CIO. But he adds: “More and more, my board looks to IT to support the globalisation of our business by being more agile and integrating new businesses, and also through all of our partnerships. We need to make sure we are fast and agile across the world because we don’t have employees in all countries.”
Beyond even that, though, he posits a role for IT to give “support to the actual business, to be part of our own business”.
Hultin adds: “We have been doing digital products since the 1950s, but more and more we see opportunities of integrating and sharing our experience, as IT. We normally have more knowledge of cyber threats, [applicable to] the military and civil security business. And we can collaborate on internet of things (IoT) business opportunities with the business. As a company, we are in the early phases of that.
“It will be a challenge with IoT technology and other future technology developments. Openness, flexibility and agility have to be critical to your strategy – otherwise you will die.”