The Boeing Challenge

The Boeing Challenge

Group A

Professor Escobedo

3/27/2013

Table of Contents

Item

Background ......................................................................................................3

Area of Concern ................................................................................................4

Problem Statement............................................................................................5

Plan of Study...................................................................................................7

Current Performance......................................................................................... 9

Strategy Analysis........................................................................................................10

Vision..........................................................................................................12

Two year goals............................................................................................................13

Company present strategies......................................................................................................14

Swot Analysis................................................................................................15

Financial Analysis............................................................................................17 Profit Margin

Analysis.......................................................................................................18

Works Cited ..................................................................................................20

Background:

Boeing is the leading producer of commercial jets and military airplanes. They also design electronic defense systems, missiles, satellites and modern information and communication systems. Their business strategy focuses on developing solutions for cost effective exploitation of their aircrafts, providing fuel efficient models, and reconfiguring the seating layout to optimize the passenger occupancy ratio. The company was originally founded in 1916 in close proximity to Seattle, Washington by William E Boeing as the Pacific Aero Products Company. The following year the company was renamed and built its first seaplane. In 1919 Boeing set up an airmail service between Seattle and Victoria, Canada.

As the world's most important aerospace company and a top US exporter in terms of sales, Boeing provides products and services to customers in 145 different countries. The Boeing Company (Boeing Corporation) is, perhaps, best known for its line of civilian aircraft, the most famous being the Boeing 747. Boeing is the world's second leading weapons manufacturer and the main contractor for the Space Shuttle.

The Company carries its operational activities in four prime segments: commercial airplanes, military aircraft and missile systems, space and communications and Boeing Capital Corporation (BCC). Commercial airplane operations principally involve development, production and marketing of commercial jet aircrafts and provide related support services. Military aircraft and missile systems operations principally involve research, development, production, modification and support of military aircraft; both land-based and aircraft-carrier-based, as well as helicopters and missiles.

Space and communications operations principally involve research, development, production, modification and support of space systems, missile defense systems, satellites and satellite launching vehicles, rocket engines and information and battle management systems. BCC is primarily engaged in the financing of commercial and private aircraft and commercial equipment.

Area of concern:

The aerospace giant has been faced with several problems and challenges in its operations in the recent past. The structure of management at Boeing includes a massive aerospace and defense corporation. The business model of the company lays tremendous emphasis on the introduction of innovative practices. One of the best illustrations of the company's innovative management practices can be observed in the form of jumbo jets and their components. Such an approach has enabled Boeing to facilitate a range of supplementary inventions. (The Boeing Company, 2008)

In addition to operational concerns, the company has been dealing with strikes by workers demanding wage rate increases. These strikes cost the company a substantial amount of money. The aerospace machinists strike in 2008, for example, cost the company $5 Billion. Such strikes can destroy a company's established reputation with their customers. (Brown & DeHayes, 2011) [The rest of this paragraph is confusing, I would recommend reworking it.] Luckily, strikes did not have an adverse effect on Boeing in regards to their customer base. Boeing is now held accountable and can be charged penalties if airplanes are delivered late due to such strikes.

Furthermore, the Boeing Company has also been found at fault in labor relations problems within the company. The main competitor of the Boeing Company is Airbus, however, looking at the market it is clear that in the near future more companies will become strong competitors especially coming from China. China is on the verge of producing a model that will directly compete with the 737 which is Boeing's best-seller. (Brown & DeHayes, 2011) Boeing's business could be taken away, but what they need to do is either re-engineer it or even completely redesign it.

Problem statement:

Boeing is in a dramatically changing business environment. Their commercial markets remain affected by the economy, financial markets and active military actions of USA and around the world. Given these changes, what is the best way Boeing can harmonize their relationships with customers and employees, while utilizing the benefits of Information Technology to expand their business practices.