A New Airplane Program of Boeing 767 - Case Study Example

Boeing 767 a New Airplane Program Overview of the program A new study group was assembled by Boeing in 1969, a New Airplane Program. It was actually developed to study in detail the past experiences of the primary programs of Boeing like 707, 727,737 and 747. Such study was important so that the problems of past should be avoided to the extent as much as possible and to minimize the risk associated with the planning and design of new plane. This study process was named as the Project Homework. This study took around three years and highlighted the probable issues that are likely to be faced in Boeing 767 program (Ray, 1997) (Birtles, 1999). At the same time, in 1966 company was facing a lot of pressure for the development of new plane as it had been long since the last plane was launched. There were a lot of apprehensions among the directors as the company had not enough experience of developing a plane of their own. After a brief overview of the program, let us now consider the strengths and weaknesses of this program and further will also have comparative analysis of this program A new study 7X7 was initiated in 1973 and the team was made responsible for defining the scope of the program and if it gets approved then should develop (Ray, 1997). Analysis of the program Project Uncertainty and Risk Management, the project management was not effective in Boeing 767 program, is the first weakness. Since the company did not have any past experience of cockpit design for two persons, it resulted in many difficulties in the successful execution of the final product. There should have been a through analysis of design before getting the final approval. Another weakness was that the geographic locations of production were also not considered. This hence became a major weakness as the transportation of parts was important on time. Time also became critical also due to the change in the design of cockpit. The strength was that the conversion of conversion from two-person to three person cockpit, which a very big risk was handled very intelligently. First strength was that the delivery of the planes was just one month delayed. This conversion also raised project uncertainty concern. As the parts were designed for two person cockpit and payments were already made. The strength of project management was that it was decided that modification experts will fix this problem once parts are installed. This resulted in minimization of the risk of production disruption. Hence the project uncertainty arising from risk was avoided. This made the design of new cockpit more adaptable to changes. In terms of quality managements another weakness aroused due to this conversion for space. This risk seemed to disrupt the modification of the thirty planes which were almost ready and were also ready to be flown. However, many managers opposed this approach as it violated the fire control systems and may result in working environment without fire system for some time till the new system gets installed again (Shaw, 1999). Another weakness in terms of quality was about the modification in production. Until all drawing and parts were available, cockpit work was delayed for two-crew models, and also demanded the alteration in the test procedure. Testing of each system sequentially when it became operational was not possible then. Furthermore another weakness which reinforced this weakness was that functional testing was done after complete installation of two-person cockpit. Hence the delay in problem detection and correction became another big weakness in terms of quality assurance. This gave chances for some errors and problem to be overlooked from one stage of installation to other. However, the strength of this program with regard to the quality management was that parts installation was done only once and there were no subsequent removal hence the configuration was secured. This reduces the effort cost that might have incurred if parts were removed one after the other. Furthermore, quality management was carried out efficiently as all activities of quality management were not carried out as separate program. The isolation in quality assurance process from that of the production helped reduce the efforts and resulted in efficient testing. Such rigorous testing was required as there many uncertainties regarding the design of the converted cockpit. The forecasting strength of this program was that it was done in terms of three economic models which were optimistic, conservative and expected. The best part of this approach was that it was based on assumptions like continued regulation of the airline industry; continued airline preferences for routes that directly linked pairs of major cities; steadily rising fuel prices; and no new competition from other airframe manufacturers. These models added value as they were reassessed annually and were revised on quarterly basis. Hence, there should be no doubts about inflation or any change in any element used in any economic model (Birtles, Airlife's Airliners: Boeing 767 v. 7 , 1999). However, the weakness of forecasting was that the fuel prices were high and affected the forecast as it was one of main element of the forecast. The strength of cost and budget estimation of Boeing 767 program was that the parametric estimates were used for cost and budget estimations. These estimations were beneficial as it incorporated design characteristics, such as weight, speed, and length, and historical relationships, such as the number of parts per airplane, that were known well in advance of production. Financial appraisal also took place as the part of this cockpit conversion. Due to the changes in cockpit design from three-person to two-person, the cost per plane was revised. However this weakness was overcome by effectively by project management with intelligently handling the modification process. As the approach used for modification resulted in lesser scrap or plane part in comparison to other options. This eventually has a positive impact and no major financial appraisal took place. But the financial appraisals were negligible as very precise economic models were used to cost forecasting (Ray, Flying the Boeing 700 Series Flight Simulators, 2005). In terms of value earned, the main strength was maintaining the schedule and for this they employed a management viability system. This system very efficiently helped them maintain schedule. Marathon meeting were conducted in order to save time and effort. Maximum efforts were made to stick to the learning curve as planes were modified during the assembly process. In addition, plan was re-adjusted so as to have minimum disruption on schedule and scope (Boeing ). Functions of flaps, ailerons, landing gear, hydraulics, and other airplane systems were tested during the final assembly process, as was planned originally. Furthermore, on spot problems were identified and rectified, before going into the next phase of production. Hence value was earned in terms of scope was very well managed. Boeing highly skilled expert team for modification is responsible for this successful earning of this value. On the other hand, Boeing 767 program has another weakness of loss of configuration. There were also questions about the design integration of this program. The value lost was in terms of the disruption of the schedule and scope. As extra number of employees was temporarily employed, two million hours extra were added to the program hence the value earned was compromised. Change management was also very efficiently managed. This was so as the choices available for conversion from three-person to two-person was not let open ended and hence were narrowed down to only two approaches (Nicholls, 2002). Comparison Analysis Let now compare the project management in Boeing with the energy management project at Butler’s University. University had to renovate their infrastructure in 1996. The audit took place which identified that the school’s infrastructure like boilers etc were almost at the end of their life which in recent future may become a huge problem for school (Honeywell Building Solution, 1995). The identities of the individuals involved have been changed. Roles and Responsibilities There were three key personnel involved in this project. From university was vice president for the University’s operations. Two energy consultants Senior Energy Management Consultant (SEMC) and Executive Energy Management Consultant (EEMC), from renowned Honeywell Building Solutions rendered their services to the university. The roles and responsibilities of vice president for operations were to provide a link between the university’s administration, Board of Governors and Honeywell on all the matters pertaining to the infrastructure and related services. While the role of vice president operation of Boeing who initiated the study program without complete requirement gathering internally and externally which cost Boeing hearty in terms of cost, time and overall management and value management. The roles and responsibilities of Senior Energy Management Consultant were to conduct energy analysis, surveys, project management and energy simulation modeling. He provided all the alternatives available for the new infrastructure. This role can be compared with the program leader of Boeing 767 who did not effectively draw the design model incorporating all requirements timely. The roles and responsibilities of Executive Energy Management Consultant to perform spreadsheet analysis of energy and demand savings, evaluate utility company incentives and project economics, and write scope of work for energy efficiency projects. This role can be compared with other staff assisting in planning and designing the research and development of this program and lack the aspects which were efficiently covered in terms of project economics, scope etc. Flow of Information Vice president Operations very intelligently hired Honeywell for consultancy gathered complete requirements, developed a ten year installation program and guaranteed that saving due to performance of new system. This gave the board of director a clear picture about the scope of the project and the value that will be earned out of it and they approved the plan without any hesitation (Reuters, 2008). This in contrast with Boeing is a strong point. As the Boeing 767 scope and requirement were not clear till the planes were almost in the production are. SEMC carried out rigorous studies and researches which in last gave a final plan. All the changes and requirements from university were accommodated in plan so that no confusion about plan should arise in execution. This case was reverse in Boeing’s. The requirements from airlines were accommodated when thirty planes were almost in their last stages of product and ready to be flown. Furthermore EEMC responsibilities included conducting research and analysis for energy efficiency program studies and energy research projects, providing support for principal consultants via project analysis, reporting. She worked really hard to make this project execution without hiccups and added value at every stage of the execution. Cost and Time Cost and time of Honeywell in comparison to Boeing’s are inter-related and hence are directly proportional to each other. Since the requirement gathering was done efficiently by Honeywell, it did not result in any cost or schedule revision. While in Boeing 767 Program, the redesigning of cockpit from three-person to two person, the labor force was asked to work 16 hours in place of 8 hours, more arrangements were made which included a lot of effort and cost increase to solve the geographic location issue for parts production. Hence this weak planning and project management resulted in successful execution and in great savings for the university. According to Vice president of university, university is saving $200,000 annually and is expecting to save 2.5 million over the period of 8 eight years as utility just because of centralization of chilling plant (facilitiesnet, 2008). Value Since project was initiated on time and milestones were also achieved according to the schedule, the savings collection started on time. Hence, the planning which company had about savings utilization started on time and helped achieves its goal timely. Furthermore, looking at such an effective project and risk management, university expanded the program and appointed some Honeywell consultants onsite permanently. In contrast, Boeing 767 program was not able to stick to its schedule, learning curve and cost. This resulted in higher cost and a month delay in schedule than what was committed to the customers. Risk management was also performed very effectively. This was regarding the failure management of university heating point. This was because of the through study conducted by Honeywell consultant SEMC and EEMC which resulted in 35 percent energy consumption cut. Improvements From this we can see that irrespective of other elements effecting the successful execution of any project, collecting requirements timely before making plan and also before getting the plan approved. The final plan should be such that incorporates and accommodates all requirements long before the first stage of production and execution. In case of any requirement realization after plan finalization, plan should effectively perform change management. This further will also impact on cost and schedule. And all this in result will reduce the earned value which is critical for any project to be successful. Despite of many strengths and weaknesses’ in Boeing 767 Program, we were served with a hi-tech airplane on which Boeing can be proud of. Bibliography Birtles, P. (1999). Airlife's Airliners: Boeing 767 v. 7 . The Crowood Press Ltd. Birtles, P. (1999). Boeing 767 (Airliner Color History) . Motorbooks International. Boeing . (n.d.). Boeing Commercial Airplanes-767 Family. Retrieved march 14, 2009, from Boeing: http://www.boeing.com/commercial/767family/background.html facilitiesnet. (2008, March 19). Butler Did It: Saving Energy By Planning. Retrieved March 14, 2009, from facilitiesnet: http://www.facilitiesnet.com/energyefficiency/casestudy/Butler-Did-It-Saving-Energy-By-Planning--15816 Honeywell Building Solution. (1995). Case Study. Retrieved March 14, 2009, from Honeywell Building Solution: https://buildingsolutions.honeywell.com/NR/rdonlyres/FF222DC7-9A8D-4189-A0AD.../ff222dc79a8d4189a0ada723b298cd6f.pdf Nicholls, M. (2002). The Airliner World Book of the Boeing 747. Osprey Publishing (UK) . Ray, M. (1997). Boeing 757/767 Simulator Checkride Procedures Manual. University of Temecula Press. Ray, M. (2005). Flying the Boeing 700 Series Flight Simulators. University of Temecula Press, Inc. Reuters. (2008, april 22). Honeywell Helps Butler University Reach Students and Faculty in an Emergency. Retrieved march 14, 2009, from Reuters: http://www.reuters.com/article/pressRelease/idUS145644+22-Apr-2008+PRN20080422 Shaw, R. (1999). Boeing 757 & 767: The Medium Twins. Osprey Publishing. Read More