Original Date: 09/14/1998
Revision Date: 01/18/2007

In the past, Raytheon Missile Systems Company (RMSC) (formerly Hughes) was managed by a stovepipe structure which typically focused on major programs or products. However, this approach did not promote communication between programs, and often prevented savings from being gained via common processes and shared support services. Prior to the Raytheon/Hughes merger in 1997, the company implemented an innovative organizational structure that provided an effective way to manage 9,000 employees, three million square feet of facilities, and more than a dozen product lines. This structure successfully carried the company through the merger, and has led the ensuing changes and improvements that the company has experienced during 1997 and 1998.

Figure 2-8 shows how the RMSC leadership team is structured. The president’s primary role is to oversee strategic planning for the enterprise, and be the primary focal point for customer contact. The leadership team is divided into two councils: the Operations Council and the Program Council. These councils are strategically focused and share the responsibility to guide RMSC, under the direction of the president, toward its vision and goals. The Operations Council focuses on internal customers, guides the support processes, and is responsible for overseeing improvement initiatives (e.g., Vision 2000 implementation teams, six sigma, ISO-9000, agile enterprise initiative, people development). Other responsibilities include employee training, facilities improvements, and computer infrastructure. The Program Council focuses on external customers by monitoring customer relations, business opportunities, global markets, product deliveries, and field reports. Weekly council meetings provide a forum to share information and determine actions among product line leaders. Actions assigned at the council meetings are flowed down to the responsible organizations within the company.

RMSC’s leadership structure provided the framework for the rapid integration of cultures and businesses during the merger period, while successfully implementing major improvement initiatives. The council structure facilitates communication, and ensures that the enterprise can leverage off best practices originated in all areas. This management structure enables RMSC to implement integrated process architecture; leverage procurement through purchases shared across programs and business units; and share lessons learned to improve productivity and profits. The Council management structure also minimizes the stovepipe ideology, and eliminates waste associated with running separate businesses within a single, large company.

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