@ of) Indian Institute of Management Indore
fata erm .
li: INDORE Israeli Aircraft Industries
Case Centre/Marketing/ /2016
‘The date was 02 July 1979. It was a red letter day in the life of Moshey Ranger (called as Moshey).
From his humble background from remote village in Haifa district, MOSHEY secured admission in
Tel Aviv University College of Engineering, (TUCE) which was one of.best in country, purely on
merit and managed scholarship for the state top rankings scholars. Today after completing 5
years of mechanical engineering degree, Moshey was travelling back to village.
Moshey’s mother used to tell him the horror stories of the concentration campsin Poland from
which his parents escaped, travelling in a coal carrying train for 4 days without food and water and
in the process losing all their 3 children. After the war, they settled down in Israel and Moshey
was born in 1957 at a very later stage in their life. Moshey’s father passed away when Moshey
was 4 years oid and it was his mother who brought him up against all odds. He decided that he
would now give every possible comfort to his mother in the coming years.
On the previous day, a number of recruiting companies visited TUCE for campus placement. Being,
the topper in college, Moshey got several excellent offers from big companies like Elbit, Rafael
etc. at a handsome salary, but Moshey preferred the state owned unit Israeli Aircraft Industry
(IAt) at a much lower salary as Management Trainee. Moshey was extremely happy that he was
joining his dream job of aircraft design and manufacture as IA was only aircraft factory supplying
the military aircraft to Israel Air Force (IAF).
After 1.5 year of rigorous training, Moshey was posted at |AI's main facility at Ashdod which was
spread over 4000 acres of land. IAl in ASHDOD was fantastic aircraft manufacturing hub, perhaps
the biggest in Asia. It handled manufacture of all types of fighter aircraft for the Israeli Air Force
and also sold some of them in the International market.
This is an Anonymous (armchair) case has been written by Prof NM Bhatta base of indian Institute
of Management Indore. It is based on a series of experiences that he came across as a long standing
Business Excellence assessor for indian and Global Companies. This case was created only for the
purpose of narrating the importance of “Customer Centricity to Business Managers”, Any
resemblance to any real life incidents or names could only be a coincidenceWithin few months of joining factory, Moshey realized that there was a huge amount of
perception differences between IAI and the IAF which was the main customer for IAI. The
customer perception was that IAI always insisted on too much of bureaucracy and paper work and
does not support the Air Force in the most critical times of operational crisis. On the other hand,
IAI was apprehensiveabout attitude and unreasonable demands of the Air Force. Moshey felt it
quite odd that both IAI and air force being in “the only vendor and customer relationship”, still
did not pull on very well. Their acts were not harmonious for the benefit of the country. But
Moshey was too junior to make a visible impact in changing the situation.
After spending 4 years in the Aircraft assembly and manufacturing facility, Moshey was
transferred to the Overhaul Division of IAI as shop in charge in in Apr 1984. At that time IAI had
submitted bids to IAF for overhaul of the US manufactured F-16 aircraft. It wasa very big contract
worth several millions of dollars. The competition was very tough and the shortlisted firms
included original manufacturer from US, British Aerospace and IAI. Final negotiations were held
at IAF headquarters in Tel Aviv at which the General Manager (GM) overhaul division, Mr
Benjamin Peres, participated from IA. Moshey was asked to accompany Mr Peres to help him in
the presentation.
What Moshey witnessed at the negotiation meeting was shocking to him. He could clearly observe
a sense of mistrust and indifference in the IAIF officers heading the negotiation meeting. Though
1A"’s bid was the lowest, it was rejected by IAF on technical grounds that IAI does not possess as
much know how on the aircraft as the original US manufacturer had. It’s plea that they have a
Transfer of Technology
(TOT) arrangement with US was not accepted. This had left a very bitter taste between IAI and
IAF. Moshey was convinced that the real reason for IAs bid rejection was IAF’s perception of IA
He was quite upset the way IAF handled the situation and like many other of his senior colleagues
at IAI, he also started developing negative attitude towards IAF.
Two months later, in June 1984, one of IAI manufactured aircraft had a bird hit at a forward air
base. Having been an expert on this type of aircraft, Moshey was asked to lead a team of
technicians to the place of incident to check the damage and give the estimate for repair.
This was first opportunity for Moshey to visit a forward air base where actual air operations were
carried out. Staying there for 3 weeks, Moshey practically saw the struggle the Air Force personnel
were going through from early morning 3am till night 1pm, continuously, handling training and
operations. There was a severe shortage of manpower, high degree of pressure due to large
volumes flying and more than anything else to maintain the aircraft with such heavy commitment
of flying was a real challenge to the technical personnel.
During his stay at the forward base what Moshey missed the most was his freshly cooked meal
supplied by IAI canteen. The IAF personnel at the forward base were not getting fresh supplies of
meat and vegetables and relied completely on tinned stuff. Moshey wondered how anyone could
eat tinned stuff day in and day out,Seeing the plight of the Air Force personnel in the field was an eye opener for Moshey.
Unknowingly, a he started developing tinge of sympathy and soft corner for them. He suddenly
started feeling that IAI was indeed insensitive to the stressful life of IAF personnel. He was
determined that he will work hard to change this perception of IAl and IAF at the earliest possible
opportunity.
‘At the Air Force base, Moshey came in contact with an IAF engineer by name Amy Rahal. Like
Moshey, Amy also graduated from TUCE though 4 years later. Being from the same Alma matter,
they became good friends personally.
‘The damage to the bird hit aircraft was substantial, in the normal course, aircraft was required
to be moved to [Al's main factory at Ashdod and several parts like air intake, some control surfaces
on the leading edge of wings etc., were to be replaced. The process would normally have taken
4-5 months. Moshey madea detailed report and took it to Amy for his counter signature. At that
time, Amy made an unusual request to Moshey, if he and his team could help them in replacing
parts at the base itself by taking them from another unserviceable Aircraft.
Moshey’s first reaction to this request was an emphatic NO. He was fully aware that such an
action was unthinkable given the highly formal and procedure driven relationship between 1Al
and IAF. Ona second thought, he felt that Amy's request was not completely out of place. Looking,
at the flying requirement at the base, losing another aircraft for several months would put huge
pressure on the IAF. He also knew that if he contacted his boss in ASHDOD and asked for
permission, the answer would be a clear “No”
Moshey had a meeting with his team that night and told them ~ “Look folks, thisis the request
from air force. | know it is @ very unusual request. But, air force isour customer and customer
should be the most important entity to us. We are there, because they are there. We have all the
tools and know-how to help them out of the way but ! can’t do it without your help and the
confidence of you all.”
There was a lot of heated debate and Moshey reminded his technicians of the hard life the airmen
‘were having in the base and how harder it would became if the damaged aircraft was to be shifted
to ASHDOD for repairs. After hours of pleading, the technicians were convinced and agreed that,
they would go out of the way to ensure that the damaged Aircraft was brought online in the next
48 hours. True to their word, they worked day and night and achieved the feat.
On his return from to ASHDOD, Moshey knew that he would get a mouthful from his boss for
what he had done at the Air Force base. His boss was truly upset and removed Moshey from the
main stream operations and put him in charge of documentation section, which was used to be
normally given to unwanted people. Moshey accepted this verdict silently but ensured that none
of his team members were harmed /punished in any way. He took the entire responsibility upon
himself