More than 120 of Leonardo’s Italian suppliers have accessed improvement and development projects through LEAP. These include specialist managerial and technical training programmes, long-term commercial partnership contracts, financial support agreements and initiatives to promote technological transfer, digital transformation and cyber-security.
More than 67 Leonardo's key suppliers – which amount to a combined turnover of 1.3 billion euros and 7,500 employees – have participated in the Elite-Leonardo Lounge programme, following a development path specifically aimed at entrepreneurs and top managers of supplier companies to accelerate their growth and facilitate access to capital, networks and core skills.
One of LEAP's objectives is to strengthen the supply chain to create more solid companies with a stable investment horizon, making it easier for them to innovate and compete in the international arena. One set of figures in particular underlines how the LEAP programme has benefited the country's economic system, helping to create a fabric of healthy and profitable companies through the growth of the SMEs and the implementation of targeted consolidation processes.
Over the last three years, there have been more than 40 extraordinary transactions between the various players within the supply chain; 70% of the transactions have involved companies participating in the Elite-Leonardo Lounge, with two suppliers – ALA and Civitanavi Systems – which have become listed on stock exchange in the last 12 months. Out of the total, 40% of the transactions involved suppliers from the mechanical sector, followed by the engineering and equipment clusters, with a 20% share each.
According to a recent study conducted by a team of Italian universities using statistical matching techniques, the companies involved in the LEAP programme recorded substantially higher growth than similar suppliers not involved in the programme. In fact, between 2017 and 2020, the participants’ turnover rose by 20%, doubling their intangible assets and increasing their EBITDA by around 50%, compared to the companies that did not participate. Furthermore, the companies involved also show a higher propensity towards innovation, opening up the company's management to people who are not necessarily linked with the ownership, and use employee incentive schemes, with a substantial focus on performance-based bonuses.
Leonardo implements the drive towards greater focus on sustainability issues in every stage of its working relationship with suppliers: from pre-selection and qualification requirements and tender selection criteria, right the way through to contractual terms and conditions and assessments aimed at the constant improvement of key suppliers, adapting each intervention according to the supplier's role in the supply chain.
We also introduced the LEADS (Leonardo Assessment and Development for Sustainability) assessment model for a better understanding of supplier performance. Performance, capability and sustainability have now been integrated into a new, single tool for continuous assessment and improvement. All factors that have also raised expectations for companies hoping to establish a partnership and build a competitive, innovative and sustainable ecosystem with Leonardo.
Over 500 key suppliers were assessed on the ESG Sustainability axis in 2021, identifying strengths and improvement areas within the supply chain. Based on the results, Leonardo published the ‘Sustainable Supply chain Manifesto’, which addresses three main issues that are closely aligned with Italy's development goals: digital transformation, cyber security, people & planet, which have been divided into 18 tangible projects with progressive and measurable milestones to support and accelerate the transformation of Leonardo's supply chain.
By the end of 2022 one of Leonardo’s sustainable chain development goals is to manage over 75% of ’group’s orders via digital collaboration platforms. Whereas the objective for 2023 is to implement training and awareness initiatives among SDGs and provide reporting support tools to over 80% of all key suppliers, i.e. over 500 suppliers. As well as this, all LEAP partner suppliers will be required to have defined green energy targets and plans for reducingCO2 emissions, waste and water consumption.
To meet this commitment, Leonardo's suppliers provide the high-level, value-added services and products required to cope with an unprecedented need to accelerate innovation in both products and processes, and introduce new technologies across the entire value chain. These all-Italian champions, many of which are SMEs, are all united by a minimum common denominator: the constant pursuit of technological innovation and the acceleration of digital development. At the first Leonardo Suppliers Awards, held last December, twenty awards went to Italian suppliers, who distinguished themselves for their excellence in performance and sustainability.
These recognitions included engineering solutions, such as the ones provided by T.P.S. and those implemented by TXT E-solutions; Logic in the equipments and Marini Impianti Industriali in the electronics sector, are just a few examples of the individual pieces that contribute to the preservation and expansion of a mosaic of products that Leonardo sells in more than 150 countries worldwide. An order portfolio that, at the end of 2021, was estimated at 35.5 billion euros, guaranteeing a production coverage equivalent to approximately 2.5 years.