The Collaborative Network of the Boeing Company - Research Paper Example

?Question: Managing collaborative networks means trying to create “collaborative advantage” or “public value” and avoid “collaborative inertia” in the face of many practical barriers. Critically evaluate how a manager succeeded or failed to do so in a specific case. Answer: Introduction When organizations expose themselves to communities and stakeholders, they try to form alliances with other organizations to extend their core expertise. Such alliances serve as the cornerstones in providing their customers with a complete and effective solution. Many contemporary organizations are aggregates of units compiled together for their individual capabilities that have been joined to fulfill a specific need of the customers. To realize the network organizers’ individualistic and collective objectives, it is imperative that the network functions in a collaborative manner. The collaborative network is a dynamic structure with the agility to repeat its components and to interpret the way they relate to one another operationally as well as legally during the evolution of the context and purpose of the network. Collaborative network is a way of organizing directed at creative new value and leveraging the use of existing resources. Such way of working harnesses the strengths of all contributors so that they are connected in different and innovative ways. “The ability to orchestrate the various elements of a collaborative network into a collective ‘whole’ presents as a key success factor, implying the need for a management function” (Mandell and Keast, 2009, p. 3). In light of the contemporary organizations’ global reach, organizations are expected to seek the satisfaction of their customers’ needs irrespective of the size of the organization. Managers and leaders have to play the most important role in helping the organizations achieve this because they are the decision-making authorities and their decisions can have huge impact on the tendency of an organization to develop successful collaborative networks. This paper discusses the success of leaders in collaborative networks with a detailed discussion of two case studies; Boeing’s Dreamliner 787 and Airbus’ A350. Case Study: Collaborative network of the Dreamliner 787 The collaborative network of the Boeing Company that was used for the design and development of the 787 Dreamliner provides a potential example of the challenges commonly faced by the management as the organizations are guided to play appropriate role of the collaborative networks following a certain strategy. In the year 2004, the Boeing Company was all set to enter the long range and mid-sized market of the commercial jets. Therefore, several production and engineering innovations were introduced by the Boeing Company. For example, one of the innovations was construction of the 787 family of airplanes from a plastic resin of carbon fiber in place of aluminum that was traditionally used for the making of airplanes till then. This provided the Boeing Company with a way to increase the fuel efficiency of the 787 airplane. The 787 airplanes have a communications system based on satellite installed in them to provide the passengers with access to the Internet, help improve the monitoring maintenance with the wireless networks, and make electronic flight bags accessible to the crew that consist of reference data and charts. The windows of the 787 airplane are larger in size as compared to other aircrafts made till then. The larger size provides the passengers with additional comfort by increasing humidity and air pressure. “With the 787, Boeing was dreaming big dreams. They wanted to create a next generation plane – a plan that was everything a 21st century airline could possibly want. And they wanted to slash the cost of production, as well as the cost of operation. It was a daunting challenge. But Infosys was up to the task, co-developing innovative solutions in Information Technology (IT)” (Infosys, 2006). The Dreamliner served as a hope for the Boeing Company to gain a substantial share in the market of commercial airline in comparison to the rival Airbus SAS. The customers have responded to the Dreamliner enthusiastically. This can be estimated from the fact that in spite of certain cancellations, the Boeing Company received the orders from 55 customers for 850 airplanes in April 2009 (boeing.com, 2009). In addition to the technical innovations of the 787 airplanes family, the way in which the Boeing Company has carried out the program reflects organization design’s innovation. The Boeing Company compiled a global collaborative network of over 50 partners in an attempt to reduce the time to market, cut down on costs, and access the specialist expertise. These partners of the Boeing Company operate in more than 130 different locations across the world. The Boeing Company has been into business with a host of the network member firms for a long time. Nevertheless, the Boeing Company has brought about a radical change in its nature of alliance with the network partners for the Dreamliner Program. The 787 Dreamliner is the first airplane in the entire history of the Boeing Company that has been designed, for the most part, by other companies. In order to reduce the cost of $10 billion to be incurred in the development of the airplane, the Boeing Company assigned the responsibility of design and development of the airplane’s components to the partner suppliers. The components are then shipped to the facilities of the Boeing Company in Everett, Washington where they are finally assembled. The Boeing Company estimated that such a work distribution to the specialist partner suppliers would not only reduce the time to the market by two years but also reduce the final assembly time by as many as 27 days (druckersociety.at, n.d., p. 8). In order to spread the risk and reduce its own cost, the Boeing Company asked the partner suppliers to make a cumulative investment of $4 billion. In many cases, the Boeing Company asked the partners to wait for their work’s payment till the delivery of the planes was taken by the customers. The Boeing Company expected to deliver the first airplane in May 2008. To encourage the partners to accept the risk, the partners are allowed to develop long-term contracts with the Boeing Company. Some of these contracts are as long as 30 years which is the program’s planned life. The partners were assigned the responsibility of quality, price, timeliness of the arm’s-length suppliers, supply chain, and performing in compliance with the established standards of the overall design architecture. Case Study: A350 Programme In January 2007, Didier Evrard was appointed as the A350 XWB Programme’s Head (Airbus, 2012). He was required to manage different aspects of this programme in general and the industrial and technical development in particular. The new A350 was a chance for Airbus to form a collaborative approach from scratch. Executives that dissected the superjumbo fiasco in the year 2006 faced the challenge of lost control by the top project managers over the distant operations. Therefore, the Airbus managers were determined to avoid the past errors when they resolved to launch the new A350. Didier Evrard was chosen to run the project because of his reputation for his cultural and technical knowledge and expertise. The level of confidence in the start was quite low as Airbus had reworked the designs of A350 several times before. Since Evrard was the program manager, he could have focused his attention on the airplane blueprints, but he chose the chief engineer to do that. Evrard instead focused on the development of cooperation between the lobbying staff and contractors. In a vast majority of collaborative projects and value networks, there is no defined or clearly depicted actual role of the leader (Allee, 2011). Accountability in the collaborative networks is established peer-to-peer rather than upward and the group leader’s specific contributing roles are defined. This can be a very important and fundamental adjustment not only for the leaders but also for the members of the group that are trained to place more value over the priorities of the leader as compared to other roles in the collaborative network. Evrard brought the engineers of the suppliers to Airbus to ensure mutual working on the design of parts. The teams did hard work to help the contractors build the parts. Evrard plugged the suppliers into the networks of Airbus for the first time. He required all parties involved to make use of identical software so that the pool of information could be accessed by everyone. An equally daunting task was to ensure internal coordination. Evrard’s team convinced the rival Spanish and German Airbus plants to buy identical equipment and agree upon common standards. Although this approach was made to learn from the past missteps, yet certain partners wanted to spend large amount of money over the digital tool set to access the blueprints of A350. Evrard considered it essential to execute the program. A major partner of A350 programme, Phil Swash said, “I didn't want to sign up because it was quite a big investment and I already had a tool kit… Didier and his team were relentless, and that was key” (Swash cited in Michaels, 2012). It is important to note that in the collaborative networks, the traditional terms like leader or leadership are not used as such given their meaning since collaborative networks do not have any followers. Similarly, there are no leaders or followers in the supervisor-subordinate relations. In collaborative networks, relationships are equal and horizontal and are directed at delivering change in the systems. This is how the emergent forms of organizations like the collaborative networks contradict leadership’s traditional models. “However, whereas leadership is identified as an important aspect of conventional management, within collaborative network management, leadership becomes a much more critical and interlinked component” (Mandell and Keast, 2009, p. 2). Evrard placed immense emphasis on the supervision of the contractors so that they would develop more of the A350 airplane as compared to any previous plane of Airbus. He assigned unique roles and responsibilities to the different parties working on the project. Conventionally, the suppliers of aerospace developed parts from the blueprints that big manufacturer made and very occasionally discussed with the suppliers. In this case, the investors with expanded responsibilities had become the biggest, though many of them did not have sufficient experience to oversee the designers and the subcontractors. Therefore, to assist them with the process, Evrard allocated more managers and engineers to advise and teach them while sniffing the problems out. Evrard gathered suppliers to discuss the problems. The openness of the Airbus startled the contractors, that were till then used to playing the issues with the tendency to upset the customers down. Evrard made it very clear to the teams working under his supervision that the worst thing they could do was hide a problem they knew of. This should be the attitude of a leader; he should encourage the followers to bring up the issues to him so that the problems can be solved in a timely manner before they become too large to avoid. Presently, Airbus monitors as many as 450 subcontractors and suppliers all over the world. During the progress of the program in the year 2009, confidence of Evrard and the teams working under him grew. By the mid of the year 2010, the information channels of Evrard flagged a problem because of the delay caused in the blueprints. Like the Dreamliner 787 of Boeing, A350 also consists of composites of carbon fibers instead of aluminum that is what the airplanes are traditionally made of. Therefore, providing these composite structures with the strength was a challenge in front of the engineers working on this project. Evrard needed more time since in November 2010, Airbus showed almost a delay of six months. Another unfavorable event that showed up was the struggle made by the lower-tier contractors to make timely delivery of the parts. The center section of the plan at Spirit lagged behind the schedule in part because of the delays in the receipt of the 8000 clips used to tie the pipes and wires to the structure. Almost every clip had a different design and it was first time for the Airbus to have them made with the help of composites. It took longer to manufacture the composite parts as compared to the time that had been consumed in the establishment of the metal parts. As a result of this, progress of the work was slowed. Little time had been left because of the earlier blueprint delays. It was nothing less than a test of stress for the entire supply chain. Late arrival of the parts rippled the delays upstream. Many big parts of the first airplane that was supposed to be tested were not ready to be assembled. To help the suppliers progress from the design to the manufacturing of the parts, Evrard made and issued a handbook consisting of a 100 pages that was titled The A350 Making-Of. According to Evrard, “My focus has been on how we build, as much as what we build” (Evrard cited in Michaels, 2012). The design of the new plant of A350 was made in such a way so as to allow more simultaneous work and avoid the delay of the complete assembly line just because of a hiccup. It was made possible to immediately ripple the frequent changes in design through the blueprints with the help of better networking with the distant suppliers. The extra work yielded benefits when sections of the first A350 airplane that was flown around Europe were eased together with vast claws guided by laser. Evrard said that the extremely snug fits hardly left any room for the sealant. There was a dilemma in front of Evrard. One option that Evrard had was to rush the unfinished fuselage components together and thus, catch up with the schedule, though it would not be easy to finish the tasks after that because of being out of sequence. The second option that Evrard had was to make another delay in order to make sure that all things were correctly done the very first time. Airbus caused a delay of six months. It would not be an informed decision made by Evrard had he decided to rush. One of the most important lessons from the past that need to be learnt is minimization of the incomplete work at each and every step of manufacturing. The managers of Airbus realized out of embarrassment that there was a need to help many suppliers. If this was not done, the problems could aggravate. “At more than a dozen top partners, teams from Airbus, the supplier and outside consultants began digging through operations to fix glitches and detect looming troubles, such as poor data management and bad coordination between contractors” (Michaels, 2012). The performance of the GKN teams is better than before with Airbus as they have experienced fewer conflicts and have generated better results. However, still sometimes the goals of the teams become inconsistent with those of the Airbus. Test flights of A350 would get tougher in the next year and it will be harder to accelerate the production. Further delays are predicted by many industry observers, though the officials of Airbus maintain that they are right on the target. Competition between the two airplanes At Airbus and Boeing, the complexity of jetliners drives the new approaches. It is only once a decade that new models of airplanes are made, because of which, each successive model of airplane displays a technological leap ahead of the preceding models. Over the years, the competition between Boeing and Airbus has intensified. According to Guenter Butschek, the Airbus COO, 550 orders have already been taken and the delivery targets are tough, “By the end of 2018, 10 beautiful A350s will be rolling out of the door every month” (Butschek cited in Dividends & Income Daily, 2012). The jet will enable the Boeing Company to directly compete with the 787 Dreamliner. Dider Evrard, the head of this initiative, speaks about the advantages Airbus’s A350 has over Boeing’s in these words, “On everything from aerodynamics and systems, to the cockpit and the cabin, the A350 combines the best of new and existing and creates something very special, very efficient and profitable to our customers” (Evrard cited in Dividends & Income Daily, 2012). Conclusion Concluding, the collaborative network of the Boeing Company that was used for the design and development of the 787 Dreamliner reflects a host of challenges that the leaders commonly face while guiding the organizations to assume suitable role in the collaborative networks in light of a well-built strategy. Different sets of needs of an organization require the development of different collaborative networks. An organization may take part in more than one collaborative networks simultaneously. These networks may be comprised of competitive firms. When organizations become collaborative networks, competition among the organization becomes network to network. Products and services no longer define the competition. Instead, people’s ability within the organization to work across boundaries to provide the customers with value and develop networks of relationships defines the competition. In order to grow and innovate with an unattractive economy and structure of the traditional corporation, organizations need both collaborative capability and specialized expertise. Didier Evrard led the Airbus Company through the A350 programme as the Head of the programme with success. This programme was unique in that the airplane was made of carbon fiber rather than aluminum and the different activities of the project were distributed among different teams so as to ensure a joint effort in a collaborative network. It was only through sheer hard work and intense supervision of the contractors by Evrard that A350 airplane surpassed all previous models of planes of Airbus. Leadership is an emergent behavior rather than a fixed, unchanging, or permanent behavior. This emergent behavior originates in a shared social reality. Qualities valued by a leader depend upon the circumstances and context in which the leader operates and roles played by people in that context and circumstances. The leader does not create their roles fundamentally, but plays an active role to direct them in a way that is favorable for the attainment if the goals of mutual interest. The keys to success in collaborative networks is having a well-thought plan upfront, making best use of the resources, maintaining high level of coordination among the various parties involved in the project, and taking necessary measures to avoid dysfunctional conflicts. 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