BOEING 787: MANUFACTURING A DREAM Harvard Case Solution & Analysis


The introduction of the company:

The project that has been started by the company, named Boeing 787, the company is one of the leading aircraft company in the US. The company came into existence in 1926, gained expertise in the manufacturing of both the types of aircraft, such as commercial aircraft and military aircraft. Boeing considers the commercial sector to be their main sector of aircraft and wanted to excel and had been working hard to create innovativeness in the operations. The staff of the company in the commercial sector was approx. 160,000 across the globe, the company has done its operations in more than 70 countries in 50 different states. The company has undertaken many mergers arrangements until now, the executive Condit is of the view, that mergers would bring more expertise to the company and ultimately the performance of the company gets better.

Boeing 787:

The company has started this initiative to manufacture a Dream liner project, involving the world class partners to manufacture a single unit that has all the special features and part so that the company could beat Airbus aircraft customer ship considerably. The partnership model that the company has opted for involves extensive manufacturing procedures and complex supply chain activities to make the aircraft ready to supply to the customers. The company has intended to bring innovative aircraft having superior features that would change the dynamics of the aircraft industry. The company wanted to create a competitive edge in order to beat the Airbus plane that has greater seating capacity, and that would serve to the farther destinations as well.

BOEING 787 MANUFACTURING A DREAM Harvard Case Solution & Analysis

Boeing 787 manufacturing process and supply chain issues:

The company has faced many supply chain issues during the manufacturing of the aircraft, since the company has taken initiative to involve variety of partners all around the world to gain the economies of scale and to bring such an innovative product to the market that would re-define the example of a perfect aircraft having superior features that would accommodate many passengers, having less fuel consumption, strong mileage and having the ability to travel through long destinations. Since the project was huge and envisioned to bring the innovativeness and specialization all around the world concentrated in one single unit, Boeing 787, it also has a different supply chain that has been involved in the process. There were different tiers of suppliers that formed the supply chain.

The tiers can be differentiated as tier-1, 2 and 3 suppliers; the tier 3 and 2 suppliers or partners were interconnected with each other. Tier-2 partners were responsible for selecting atier-3supplier, and then the role for tier-1 partner came, ultimately aircraft was manufactured and supplied to the factory premises for further processing and then supplying to the respective customers.

Although the supply chain mechanism was innovative and sophisticated, the execution of the supply chain activities and the management of the processes were not up to the mark; the suppliers did not perform their duties well on time that has caused major delays in the launch of Boeing 787. The manufacturing process was one of the complex and requires major expertise for its execution on time. The frequent leadership changes throughout the manufacturing process, i.e. the one who leads this huge project, also made the process slow and unattainable.

Management assumptions for manufacturing Boeing 787:

The strategic thinking to manufacturing such a project that would lead the company in the aviation industry was not that of a bad strategy, but it requires exceptional expertise to deal such a huge project having different procedures and structure. The company has mismanaged many of the processes of manufacturing. The company’s vision was to manufacture a high-quality product with less cost, more benefits that could be generated from different partners to manufacture a single unit. The differentiated supply chain that would enable the company to do that project in less time and less cost and more advanced features, it was their vision for the aircraft, furthermore by involving different partners, company wanted to spread out the risk to the different partners that are why they had taken to outsource 70% of the process to the outside partners, the normal practice of the company is to outsource 30% of the work. This was a major change. Furthermore, the partnership strategy involved having no contractual relationship with them, but the risk sharing approach opted. The approach has given flexibility and room to the suppliers to delay their supplies because they were not afraid of penal obligations, all the partners did not show the ultimate responsibility for the process completion, the process of final assembly also delayed for 30 days, the normal time associated with the assembly was 3 days. Many of the areas were not focused and properly planned that has caused Boeing to suffer from huge losses, financial loss, credibility loss and loss of potential customers as well...................

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