The Boeing Company is the world’s largest aerospace company and leading manufacturer of commercial jetliners and defense, space and security systems - Boeing Swat introduction. A top U. S. exporter, the company supports airlines and U. S. and allied government customers in 150 countries. Boeing products and tailored services include commercial and military aircraft, satellites, weapons, electronic and defense systems, launch systems, advanced information and communication systems, and performance-based logistics and training (Boing. com, 2013).
According to Stephanie Chatman, who is a Procurement agent of The Boeing Company, Boeing has a 51% market share, which is a very close percentage to their rival Airbus 49% market share. Drew explains that Boeing now expects revenue for 2012 of $79. 5 billion to $81. 5 billion, where their earlier projection was $78 billion to $80 billion. (Drew, 2012). Strengths The Boeing Company has multiple strengths to deliver to this SWOT analysis. They display diversity. Boeing produces commercial airplanes, integrated defense systems, military and missile systems, as well as space and communications.
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This broad range of products and services allows them to have more stability. They also have good customer relations and Boeing continues to work to make their planes more comfortable for passengers and its crew. In addition, it has an easy to navigate and informative website. Boeing also has great air traffic systems improvements and also helps airports use planes more effectively by assisting with communications because Boeing constantly research and provide the most updated and safe communication systems.
Boeing has companies in many countries and provides its products and services all over the world. The final strength that Boeing possesses is its historical prestige and significance. Boeing has been a trusted company since the early 20th century and it is the number one commercial airline provider and the number three-defense provider in the world. WEAKNESSES According to “Boeing Dreamliners Grounded by Japanese Airlines”, an article by Miwa Suzuki, Questions about safety have the potential to affect sales for Boeing. Outsourcing was also an issue for the company. Boeing enthusiastically embraced outsourcing, both locally and internationally, as a way of lowering costs and accelerating development. ” (Steve Denning, 2013).
Even with proven technology, there are major risks in outsourcing that components won’t fit together when the plane is being assembled. (Steve Denning, 2013) David Horsager says “a failure to value the trust of the customer” is at the core of Beoing’s trouble. In the article Horsager talks about several companies who have had recent mishaps that have a negative impact on the customer’s trust of the company.
Horsager had this to say “In the last month alone there have been a slew of lessons in the high cost of ignoring the importance of trust. ” OPPORTUNITIES David Horsager states in his Forbes article entitled “How Did Carnival, Boeing, Barclays, and Tesco Squander Our Trust? How Do They Win It Back? ” There are steps to gaining back the trust that was lost by the recent incidents that have troubled Boeing. These steps are: 1. Don’t pretend trust hasn’t been lost, 2. Plan on making an apology (probably more than once) and backing it up with action, and 3.
Make every effort going forward to deliver extraordinary customer service. Horsager says “Businesses can no longer afford to let trust sit on the sidelines. They need to place it where it belongs—in the boardroom, on the assembly line, and everywhere in between, in every business that’s serious about long-term success. ” THREATS One of the major threats to Boeing could be a slowdown in the commercial jet market. One reason is due to the airline industry took the hardest hit after the September 11th attacks on the world trade centers in New York.
Boeing suffered major loses in revenues after from 2001. Both immediate reactions and he long-term repercussions have negatively affected the whole airline industry including Boeing. Another reason could be due to Boeings outsourcing to the Japanese for most of their parts for their jetliners. Federal government has grounded all of U. S. company’s new and much hyped 787 Dreamliner jets because there has been reports that the aircrafts lithium- ion batteries were overheating and catching fire.
Critics have been stating that Boeing relied far to much on foreign suppliers for the production of its new 787 Dreamliner jets. More than 30 percent of the new Dreamliner’s components come from overseas, including the Japan made Lithium-Ion Batteries. By contrast just five percent of previous jetliner 747, were made from foreign parts vs. thirty percent of the newer model. It is becoming a big argument that outsourcing is the reason for these malfunctions and that Boeing should not have relied so heavily on outsourcing their part from foreign manufacturers.
Were it really gets confusing is because vast amount of components from by hundreds of different suppliers, it makes troubleshooting that much more difficult. Another problem is that since the parts are foreign made, Boeing is not familiar with the parts like the foreign suppliers are which makes it that much more of a difficult problem to even assess let alone fix. Alternative Recommendations An alternative answer to fix this major and costly issue is to start off by asking some problem questions to figure out what is going on and how it can be fixed.
A question they would have to ask is “ Is it necessary to outsource most of Boeing plane components to foreign suppliers? ”. Another question they can ask is “ Can a solution be made where they can manufacture the same parts for the same or not cheaper here in the U. S.? ”. If they can somehow figure out the answer to these questions a solution could possibly made that would save Boeing from having to outsource from foreign suppliers and they can make a contribution to the U. S. GDP instead of other foreign countries. Need payoff can also be considered when finding a solution.
Would it be more beneficial in the long run for Boeing to have more expensive U. S. made parts, or for them to have cheaper foreign made parts and have to deal with complications due to the parts and not even know where to start on even fixing them? It is costing Boeing millions if not billions to have to ground their new line of jets because of potential problems with lithium batteries catching fire whereas they could have just used American made parts that could possibly be cheaper but save them money in the long run by being able to troubleshoot or fix minor problems themselves.