Major Issues of Commercial Aircraft - Essay Example

Case Study Introduction The case is related to the company i.e. Boeing as well as Airbus industries. From the case, it has been identified that it deals with the business segment of commercial Aircraft. One of the major issues of commercial Aircraft is the problem of production. In this respect, the case intends to explain the background of Boeing and the Airbus industries along with the anticipated impact of the Asian economic. The case provides relevant information relating to the competitive advantage of the company and the synergy of mergers as well as the reasons based on which Harry Stonecipher have been fired for the company. Boeing is related to commercial business of Aircraft. Boeing is the world’s largest producer of commercial airlines and presently, the company has produced around 707 of the world’s leading commercially sustainable jetliners. The employees of Boeing are working together as a team in a coordinated manner for enhancing the quality as well as the productivity of the company. In addition, the company has been providing the best services to the customers to achieve the competitive advantage. The business support functions of Boeing are based on the internal components that include technology, materials and human resources. To accomplish high performance and meet the expectations of the customers, the business functions of the company needed to work in a complete coordination with each other along with the business units (Boeing, 2015; Hartley, 2011; Boeing 2009). Background of Boeing Boeing is the commercial Aircraft business, which was founded in the year 1916 in Puget Sound of Washington. It is the world’s largest producer of Airbus aircrafts. The company is the world’s first commercially workable jetliner. The recent segments of Aerospace pioneers of the Boeing enterprise are North American Aviation, Rockwell International and Hughes Space and Communication and among others. Boeing is associated with different production functions that include planning, assembling and supporting profitable jetliners, support defense system, assemble satellites and promote vehicles. Boeing also conducts operations in terms of networking technology as well as network solutions. It also provides solutions related to finance problem and focused on the requirement of the customers. It designs and develops advanced system as well as technology to meet the needs of the customers through the provision of quality services as well as products. The company has been identified to have around 21,500 suppliers as well as partners globally. The company has framed several strategies to attain the competitive advantage of the company such as global growth strategies, development of the leadership program, financial objectives as well as performance, enhancements of technology as well as productivity and business ethics (Boeing, 2015; Hartley, 2011; Boeing 2009). Boeing should have anticipated the Impact of Asian Economic Difficulties Being is needed to have anticipated the impact of its business due to the Asian Economic difficulties. The average growth rate of Air Cargo Traffic of Europe- Asia is 5.5% per year. On the other hand, the average growth rate of Asia and North America is 5.4% per year. China also plays a major role in Asia through the membership of World Trade Organization (WTO) and expected GDP growth of 6.3% in the next 20 years. Boeing has faced the issues in conducting operations in the Asian market due to the rising growth as well as development of the Asian economy. The company has been identified to face issues relating to quality and pricing strategy (Boeing, 2015; Hartley, 2011; Boeing 2009). Boeing could have prevented most of the Problems that confronted it of the Asian Market Boeing can prevent the problems or issues of the Asian markets that it confronted by increasing economic growth rate in the Asian market and in terms of business expansion. Boeing has to increase the number of Airbus quantities and improve the quality as well as productivity. The problems of Asian market can be prevented by coordinating the operations of the employee. The employees of Boeing are to be provided with advanced system and technology solution for reducing the problem associated with quality and quantity. In addition, the production operations of the company are needed to be based on the needs of the customers, so that products produced are able to meet the satisfaction level of the customers. In this respect, Boeing focusing on production and quality will be able to conduct operations sustainably with an appropriate pricing strategy (Boeing, 2015; Hartley, 2011; Boeing 2009). Top Management at Boeing should have been fired after the Disastrous Miscalculations in the late 1990’s Top management at Boeing should have been fired after the disastrous Miscalculations in the late 1990’s, as during that period, Boeing faces several problems, which adversely affected the competitiveness and sustainability of the business to a large extent globally. The problems faced are related to production operations, internal factors as well as competition. After firing or retirement of the required workers, the company should have appointed competent management team or employees with the aim of resolving the identified issues. Due to the production problem, Boeing began to switch to the practices of Japanese relating to inventory management, which provides the needed material to the workers in an efficient way, so that the cost of the production can be decreased (Boeing, 2015; Hartley, 2011; Boeing 2009). “Management Worries too much about Airbus and to Hell with the Stakeholders.” Evaluate the Statement The statement ‘Management worries too much about Airbus and to hell with the stakeholders’ signifies that Airbus is the strong competitors of Boeing, which is one of the well positioned companies to supply Airbus. Airbus has been producing quality and different products for meeting the satisfaction level of the customers. Boeing is also identified to have a delayed production function, which have been acting as a competitive advantage for Airbus. In addition, the statement implies that the management comprising investor, suppliers and shareholders among others have been playing an important role in the performance of Boeing globally. In this regard, lack of competencies of the management of the company has been an important consideration towards the in effective performance of the company (Boeing, 2015; Hartley, 2011; Boeing 2009). Recommendation Regarding that at this Point 2008, the Superjumbo A380 Abandoned A380 is the dual deck, extensive body and comfort jet airliners, which has been manufactured by Airbus. In the year 2005, A380 made its first flight Airbus superjumbo A380 in the year 2008, which has been abandoned in the year 2006, due to the fact that the problems of Airbus production become the major crisis condition. Therefore, the executives of airlines complained about the incapability about the schedules and regarding the investments due to the problem of uncertainty of the delivery of A380. Due to this problem, Airbus also announced to reduce the delivery of A380. Therefore, in the year 2008, A380 has to be abandoned with the aim of stabilizing its performance (Boeing, 2015; Hartley, 2011; Boeing 2009). Evaluate the reason Stonecipher have been Fired for having an affair with an Employee Harry Stonecipher has been forced to resign from Boeing from the position of President and CEO of the Aerospace due to carelessness and weaken reliability of his energies. He has been forced to resign the company due to the relationship with an unnamed female executive. This relationship violated the code of conduct of the company and it was an extramarital affair. This relationship also hampered the working environment as well as the works of the other employees along with Harry Stonecipher. Therefore, Stonecipher have been fired form the company (Boeing, 2015; Hartley, 2011; Boeing 2009). Discuss Synergy in Mergers and the Reason Often Synergy Seem To Be Lacking Despite Expectations The idea of synergy states that a total concept is always better than the sum of the parts. In other way, it can be stated that the well-planned merger or acquisitions can be the result in better enterprise rather than the two separate entities. However, from the case, it has been observed that there is lacking of synergy and it suffer unadorned digestive problems such as the problems with system, people and procedures, which resulted to delays in solving the problem. Often synergy seems to be absent due to the reason of inappropriate relationship among the employees and for the problem of cultural conflict (Boeing, 2015; Hartley, 2011; Boeing 2009). Likely Attitudes and Actions of Mine I am the skilled mechanist of Boeing and always been proud of practicing in building giant planes. If I have received another notice of lengthy layoff in five years, then my attitude may be not good to the company. My actions as well as attitudes have changed due to the notice of layoff, which is developing a negative impact in my mind about the management decisions. As I am expert and have the skills and always been of my work and give the first priority to my work, I always be liable to the company and follow the rules of the company. Therefore, after all this good efforts, if I got the lengthy layoff notice, then my perception towards the company and its performance will be questioned and I will lack the confidence in conducting the assigned activities in an effective manner. In addition, I will search for the better option, which can improve my career growth (Boeing, 2015; Hartley, 2011; Boeing 2009). How wise do you think it was for Airbus to “bet the company” on the superjumbo A380, the world’s largest jet A380 is the world’s largest superjumbo jet and it is developed by Airbus. It was developed in the year 2000 and it has capacity of total seats are 555. The total cost of launching A380 was $12 billion. After the production of this jet, it was noticed that several companies have failed to bet the company as a result of attempting to develop and introduce such type of product. Boeing is one of the market leading commercial aircraft businesses and accordingly, by introducing this type of jet Airbus to meet the requirements of customers and be a strong competitors of Boeing. Through A380 product, Airbus increases its sale, which is profitable for the economic growth of the company. Therefore, from this point of view, it can be stated that Airbus “bet the company” on the superjumbo A380, the world’s largest jet (Boeing, 2015; Hartley, 2011; Boeing 2009). Airbus’s More Passenger-Friendly Planes Gave It a Significant Competitive Advantage Airbus is one of the aircraft industrial divisions of the Airbus group. It developed several products, but due to the retention in production as well as in the engineering segment, it faced certain issues in terms of sales as well as marketing. However, A380 Airbus industries with the introduction of jumbo jet the sales figures have increased and additionally, the market position of the company has been identified to have a stronghold. A380 is the world’s largest jet, which provides the best quality and comfort services to the customers. The capacity of number of seats is more than the other products of Airbus. A380 jet is the more passenger-friendly airplane of Airbus, as it meets the expectation of the customers. By introducing this type of product, Airbus also attains better competitiveness, which is one of the advantages of the company (Boeing, 2015; Hartley, 2011; Boeing 2009). Procedure based on which arrogance in an Organization Be Combated Arrogance in an organization may be considered inappropriate due to the fact that it develops overconfidence in the work of employees. Due to overconfidence, employees are identified to develop arrogance, which in turn raised struggle and conflicts within the workplace. Conflict situations lead to negative influences on the work procedure and behavior of employees. In this regard, arrogance amid employees is determined to result to inappropriate coordination amid employees, which lead to confusion and ineffective accomplishment of organizational goals. The issue related to arrogance can be resolved by communicating and coordinating the activities to be performed by the employees. The employees are needed to have a better understanding about the chain of command, so that appropriate information is communicated to the designated individual (Boeing, 2015; Hartley, 2011; Boeing 2009). Conclusion From the above discussion, it can be comprehended that this case involved information about Boeing as well as Airbus industries. Both companies are the strong competitors of each other. Boeing is the commercial aircraft industry and it is the world’s leading producer. The employees of Boeing work together to provide quality as well as differentiated products to the customers in order to meet the satisfaction level of the customers. It has been observed that Airbus is also an airline industry, which produces several jet products and provides the best services to the customers. A380 is one of the good quality and comfort product produced by Airbus, which helps the Airbus industry to attain the competitive advantage. In this regard, it can be concluded that Boeing is focused on some major strategies to hold the market position and develop the business growth such ethics of the company, develop leadership strategies and improve the quality of the products. References Boeing. (2015). Boeing Overview. History, 1-20. Boeing. (2009). Frontiers. Lean in action, 7(6), 1-56. Hartley, R. (2011). Management mistakes and successes. USA: John Wiley & Sons, Inc. Read More