Michael McCormack, CEO and President, CP Technologies (US subsidiary of Aeronautics Group), was candid when he noted the San Diego, California-based company and all of its competitors are basically manufacturing server, components, displays and like materiel – “We’re basically manufacturing boxes,” he summarised.
And reflecting on workings of the notional US DoD supply chain: where CP Technologies and other companies are signed up by a prime contractor for a Program of Record; with the prime then handing off a product to an integrator to integrate, and with the integrator, in turn, sending the product back to the prime to load its proprietary software before being installed in a weapons system or platform, Mr McCormack further declared CP Technologies was going to cut out a layer of the supply chain. “What CP Technologies is doing now is fully integrated racks. We’re going to take all of the components we have previously manufactured – because we do everything from the human interface, the servers, computers, rugged switches, and other content – and partner with Electromet (Hagerstown, Maryland), Jonathan (Irvine, California) and Accumetrics (Latham, New York) to produce complete, ruggedised rack solutions.”
This new business model will reduce costs, primarily where the integrator puts a mark-up (the integration costs) on a product. “You are taking out 20% to 25% of the cost, we figure, for the integration, and removing that from the supply chain,” the industry executive said. “We’re not going to be adding another margin onto our product again, as an integrator might be doing.”
To gain other efficiencies, CP Technologies will supply a completely integrated rack, under its configuration management. Further, a single part number will be issued for revision control purposes of all components, with a plug-and-play product ready for delivery to the prime contractor or end-user. Under this revised life cycle model, logistical costs will be additionally reduced from not having to move the product around in its build phase. Indeed, these early efficiencies will further allow CP Technologies to deliver its products faster, meeting yet another Pentagon clarion call – for rapid acquisition and similar programme outcomes.
“We have already started doing this with some of the primes,” Mr McCormack revealed, and promised that, “you will start seeing announcements about that in the next few weeks.”
From this point forward CP Technologies is migrating toward fully portable, ruggedised systems for diverse uses – ground control stations, test stations and even tactical use. That baseline portfolio will further evolve into a family of products: portables; small tactical computer systems which are fully deployable with 16 terra bytes of storage, a ruggedized switch and a UBS built into it; medium tactical computers; and up to full racks. “Instead of somebody who is just delivering boxes, CP Technologies is going to be delivering complete solutions. This is a total change that we feel the market needs,” Mr McCormack emphasized.
This new business model will be supported by internal CP Technologies’ changes. In one case, the company will build a new manufacturing facility at a future date and selected site on the US East Coast. The CEO/President added: “We’ve also been on a very large hiring effort for manufacturing staff, program managers and engineers – we’ve added about 25% to our staff. CP Technologies’ growth is 60% this year over last year, and I foresee that going over 100% this year as well.”
With respect to hiring to its workforce, CP Technologies has made it a point to give consideration to individuals who know the defence community and environment – so for instance, its new hires may also be in the Reserve or Guard, and may have previous government experience at SPAWAR or another similar defence organisation.
As delegates gathered this week at SOFIC, CP Technologies’ brand was familiar to operators of weapons systems and platforms in the US and overseas – from US Navy’s Littoral Combat Ships to the Rolling Airframe Missile Programme to the AN/TPS-77 radar. Beyond this firm presence in the defence market, CP Technologies is eyeing other opportunities including the UAS market and more widely supporting SOF. “It’s all about SWAP [size, weight and power]. Everything is SWAP these days and that’s what we are moving to. And we are looking at size, weight and even power – for instance, what is my power source, can I use AC or do I have to use vehicle power? CP Technologies configures its products to user needs,” the industry executive concluded.