IFS and Saab sign strategic partnership agreement

Saab has signed a unique partnership agreement whereby the enterprise applications suite, IFS Applications, will be included as part of Saab’s support offering to the market. The first major contract to be managed under the terms of the partnership is IT support for an overall support commitment for the SK60 aircraft system.

The partnership means that Saab’s support division, besides using IFS Applications for its internal processes, will also offer its customers various business models that include a broad spectrum of services involving IT and information management. As a result, Saab, as a support integrator in collaboration with IFS, can implement solutions at customer sites, provide the service as an application service provider, or manage the assignment with in the framework of its own internal systems.

Customers, who operate in sectors that range from commercial aviation and security to defense, are increasingly demanding comprehensive solutions that include maintenance and spare parts logistics throughout the lifecycle of a product. These are often supplied by the manufacturer. In addition to its own products and systems, Saab also works with products from other manufacturers in collaboration with them, and the demands for IT support are growing. The SK 60 contract is a good example of this. The contract, valued at SKr 900 million for Saab, means that as the main supplier, Saab is responsible for operating, supporting and maintaining all SK 60 aircraft for the Swedish Armed Forces. Saab will further ensure that the aircraft system is airworthy and is available in accordance with the requirements of the Armed Forces regarding the Swedish aircraft fleet.

“We are examining several other possibilities, with both military and civil authorities, and have set up an organization in collaboration with IFS for combined marketing activities, sales and development,” said Göran Kristoffersson, business development manager at Saab Aerotech. “In our assessment, the market for this type of service and products within system support for maintenance and spare parts logistics is worth SKr 1.6 – 3 billion over the next 10 years.”

The purest form of outsourced maintenance is known internationally as”power by the hour” or Performance Based Logistics (PBL). The term ‘Public-Private Partnership (PPP) ’is used in Sweden. Customers/users pay, for example, for per hour of flying time instead of having their own organization with workshops, technicians, spare parts stores, and IT and transport services. The driving forces are lower costs and increased flexibility as the service providers—who are also often the manufacturers—can utilize their specialist competences and facilities to benefit from economies of scale.

“It is a pleasure to be part of the first major Swedish PPP contract with the defense forces,” said Glenn Arnesen, managing director of IFS Scandinavia. “We have long worked with these types of solutions for suppliers to the British and US defense forces. Now, in collaboration with Saab, we can offer the Swedish authorities a proven solution in future PPP contracts. The potential for greater efficiency and savings is considerable,” Arnesen concluded.

Aerospace & Defense is a targeted industry vertical for IFS. IFS Applications’ strength in enterprise asset management (EAM), maintenance repair and overhaul (MRO) and defense manufacturing is complemented by its fully integrated project tracking and product data management (PDM) capabilities. IFS Applications is a best-practice solution for fleet management, MRO and supply chain management in A&D.

IFS customers within the Aerospace and Defense industry include the British, Norwegian, and US defense organizations as well as the Eurofighter consortium. Commercial MRO shops and operators include Finnair, Bristow Helicopters, Aero-Dienst GmbH, Hawker Pacific, and Jet Turbine Services. In addition, IFS provides solutions to original equipment manufacturers (OEMs) such as Lockheed Martin General Dynamics, BAE Systems, Saab, and GE Transportation.

About Saab
Saab serves the global market with world-leading products, services and solutions ranging from military defense to civil security. Saab has operations and employees on all continents and constantly develops, adopts and improves new technology to meet customers’ changing needs.

About IFS
IFS is a public company (OMX STO: IFS) founded in 1983 that develops, supplies, and implements IFS Applications™, a fully-integrated, component-based extended ERP suite built on SOA technology. The company has more than 2,000 customers in 54 countries and focuses on seven main industries: aerospace & defense, utilities & telecom, manufacturing, process industries, automotive, retail & wholesale distribution, and construction contracting & service management. IFS has 2,700 employees and net revenue in 2008 was SKr 2.5 billion.

IFS Applications is a trademark of Industrial and Financial Systems, IFS AB (publ). All other referenced company or product names are trademarks or registered trademarks of their respective owners.

The information is that which IFS is required to declare by the Securities Business Act and/or the Financial Instruments Trading Act. The information was submitted for publication on May 5, 2009, at 09:55 a.m. CET. Information about the contract in respect of Saab Aerotech’s internal solution was published on December 22, 2008.