This research paper evaluates how management function collaborates with knowledge and technology in this organization by analyzing current trends and tendencies at Boeing. Boeing employed the success model approach while it was going through significant business volume increase in both of its primary markets–commercial jetliners and military air vehicles.
Boeing’s 7×7 group of jetliners got a considerable share of the business airline market with well-accepted models such as the 737, 747, 757, 767, 777, and the projected 787. Boeing managed to do this despite intense rivalry from American producers such as McDonnell Douglas and the European association Airbus Industries, which gained significant subsidies from some European governments (Smith 2001). Military business Boeing competed for during this time covered contracts for military air jets of all sorts (e.g., the stealth fighter, the stealth bomber, B-1B and B-2 bombers, as well as important deals having to do with the B-52 bomber and the KC-135 tanker). Boeing also rivaled deals in the planned space station, helicopters, and pilot-less drones. As a result, the company won over a cut-throat competition to manufacture the new presidential air jet – Air Force One (Smith 2001). Competitive conditions existed in these two markets that ever more demanded high technology computing answers in areas such as IT-aided design and producing of actual planes.
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Civil aviation is the biggest export commerce in the US, and the Boeing Corporation, which dominates almost the whole U.S. civil aviation producing industry, is the biggest exporting producer both in the US and globally. Boeing’s influence on the U.S. economy, while perhaps limited in merely macroeconomic terms by its position as one large multinational corporation among many, is enormous (Piasecki 2005). It is also huge when analyzed in industrial, strategic, and geopolitical manner. Currently, Boeing is considered to be one of the world’s most identifiable and valuable brand-names. In a time of growing economic disintegration, Boeing’s presence as a leading force in the U.S. industrial market helps many other players in the U.S. economy. In a time of the unification of military contractors, Boeing has appeared as one of maybe three or four military-industrial market actors competent of meeting the wants of the US military across a range of product lines (Piasecki 2005).
Every day, more than three million travelers board 42,300 flights on Boeing airplanes, more than 345 satellites launched into orbit by Boeing carrying vehicles pass in the clouds and 6,000 Boeing military jets present shield with air forces of 23 independent states and every division of the U.S. armed forces (Boeing Annual Report, 2005). Boeing is the major aerospace corporation in the world and the main U.S. exporter. Boeing has placed a considerable investment in its Safety System, which covers historical loss data for the whole organization, and equips Boeing with the ability to examine the corporation’s risk portfolio and project the influence of different insurance structures on the firm’s cost of risk. Boeing’s associated litigation, alterations in federal, state and local policies concerning worker’s health and safety and the environment is also a significant advantage in the commercial air transport sector (Piasecki 2005).
Boeing has placed a considerable investment in its Safety System, which covers historical loss data for the whole organization, and equips Boeing with the ability to examine the corporation’s risk portfolio and project the influence of different insurance structures on the firm’s cost of risk. Boeing’s associated litigation, alterations in federal, state and local policies concerning worker’s health and safety and the environment is also a significant advantage in the commercial air transport sector (Piasecki 2005).
During its storied history, Boeing has created a can-do reputation that borders on arrogance. While competitor plane manufacturers have come and gone, Boeing has appeared as the nation’s 11th-largest company, its biggest exporter and a leading force in the Northwest economy with 115,000 employees in Washington State.
The natural question arising at this stage is, “How all of the above notions of success represent Boeing management’s ability to benefit from the company’s knowledge and new technologies of the modern world?” The following paragraphs shed light on the Boeing management’s ability to utilize technology and resources to achieve great results. The Boeing 747, the world’s single jumbo jet, has been the leader jet for long-distance international travel since its creation in the late 1960s. New models of the 747 are still being produced, and it remains a backbone of Boeing’s manufacturing. Initially, while Airbus has created several jets aimed to compete with smaller Boeing airplanes, it has not tried to directly compete with the 747–the world’s biggest, most expensive, and most money-spinning commercial aircraft (Olienyk and Carbaugh 1999).
In 1991, at the Paris Air Show, going after Boeing’s market portion below fifty percent, Airbus declared that it would commence preliminary development of a passenger jumbo jet with a capacity of up to 700 — the biggest in history. Despite this statement, after the initiating of the 1992 Bilateral Agreement, Airbus declared that it would dump its solo effort and entered into discussions with Boeing for joint creation of the super-jumbo. With likely development costs estimated at up to $15 billion, a combined project was seen to be the only way Airbus could build a new plane and remain within the boundaries of the subsidy accord (MSNBC 2006).
Airbus continued its plans and creation, although in a low profile manner, despite the breakdown of collaboration with Boeing and adverse reports by aviation experts (MSNBC 2006). It looks like that Airbus’ decision to create the super-jumbo was not strictly a business choice, but was also motivated, at least partially, by strategic matters. Airbus announced cautious plans to go on with the A380 in mid-2000, dependent upon receiving forty to fifty requests from airline customers. The orders were gained, and in December 2000 Airbus formally declared the launch of the 500 to 900 seat A380, to be manufactured sometime around 2006.
The response of Boeing and the U.S. government was swift and unsurprising. Both parties stated that, despite the adaptation of Airbus from a French investment company to a joint stock corporation in mid-2000, the program was unjustly and perhaps illegally supported by European governments, and that Airbus’ deeds could start a global trade fight (Moxon and Kingsley-Jones 2000). Boeing declared that it had not carried on with its plans for a super-jumbo because of the likely prohibitive cost and that for Airbus to create such an air jet with the support of European governments would be an infringement of world trade accords. Airbus stated that all things it was doing were within the agreements signed by the European Union and the United States and that it would carry on as announced initially.
Overall, the creation of the A380 and planned introduction of A350XWB could have some likely destabilizing effects not just on the civil airplanes sector but also on EU-U.S. relationships in general. It is then vital that any answer to an EU-U.S. conflict over the A380 and A350XWB be proposed with this condition in mind. From the U.S. point of view, there are three aspects to consider while evaluating the A380 and A350XWB’s construction (Moxon and Kingsley-Jones 2000). The first is on Boeing’s position as a foundation of both the U.S. economy and the U.S. military-industrial sector. Secondly, it might enable Airbus to achieve a greater role in meeting Europe’s military requirements. Most significantly, it will connect Europe both militarily and technologically; when merged with an independent European foreign policy, this could intimidate U.S. hegemony.
Marketplace approaching is at the center of 787 product development. Boeing’s strategy has been to construct and build an airplane that will take travelers where they want to fly, when they want to fly, without transitional stops; do it professionally while offering the utmost comfort to passengers, and make it easy and cost-effective for airlines to manage (MSNBC 2006). Rather than hope for economies of scale, the 787 will provide economy through technological improvement, making the most of newly considered, fuel-efficient twin engines and lightweight fused materials. The 787 provides a very different take on the flying encounter, too, focusing on comfort rather than bonuses that could be reduced by airlines.
Meanwhile, Boeing seems inclined to make a favorable impression on airlines’ inventories. At present, operators have requested 159 A380s and almost twice as many 787s. Both Airbus and Boeing possess a few tools that are to serve them if things go wrong. To contend directly with the A380, Boeing’s 747-8 employs fuel-economical engines like the 787 to take 450 passengers. To win over the 787, Airbus is presenting a white elephant called the A350, which has been extensively criticized for being just a remake of the older Airbus’ models. According to Boeing, the 787 appeared as the result of over a decade of motivation groups and scientific experiments to gain a better knowledge of passenger comfort and how the design of airplane inner parts can make flying a more enjoyable experience (Boeing Annual Report 2005). The difficulties of air travel after Sept. 11, 2001, cause even short flights feel like long ones. It is not clear whether Airbus conducted research that indicated that passengers are perfectly happy to stand in long lines in exchange for a cocktail lounge and additional services like gyms.
Top executives at Boeing commented that the latest developments in the industry have proved correct their strategy against Airbus. Boeing, which has been making a bet heavily on its new mid-size, long-range 787 Dreamliner airplane, appears ready to catch or surpass its European counterpart in the highly competitive civil aviation industry. This is the point where Airbus and Boeing have dissimilarities: not so much on the number of people flying, but how airlines will get passengers. Even though each company has been talking about the value of their planes, Boeing has been the clear leader presently: it has almost twice as many orders as Airbus does. The good news for Boeing appears to be located in its share price.
However, investors have to be careful as the corporation may suffer as global economic conditions cool. Only time will rove one company right and the other one wrong. At the moment, it looks like Boeing has an indeed better strategy and deeper understanding of the market, but Airbus has many competitive advantages, and if market conditions change, it may well outperform Boeing again, just as it did a few years ago.
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