Competition Between Airbus and Boeing
Faculty of Commerce Executive MBA Program Strategic Management Boeing bets the company
Course Instructor: Dr. Manal ElKordy Prepared By: Marwan Fathy
Submitted on: 12/01/13
1. Outsource approximately 70% of manufacturing. Could it find suppliers who could consistently make the high quality parts needed by Boeing?
Actually to outsource 70% of the manufacturing process is a very huge % and will result in facing many problems because of less control over the process attached to this high% of outsourcing. This will also considered as a high risk (Threat)the company will have to bear in terms of quality and lead time, because the more the outsource the company base its strategy the less the control the company will practice over its products.
Looking to the reasons that might be behind the outsourcing decision are as follow: Lacking the required capacity to meet forecasted demand ( weakness) Inefficient production to achieve low cost (weakness)
2. Reduce final assembly time to three days (compared to 20 for its 737plane) by having the suppliers build completed plane sections. Could this many suppliers meet Boeing 's exacting deadlines?
As mentioned above to depends heavily on suppliers who we usually have less control (high threat) over them will be always attached with high risk to meet specific standards or dead time, This will also require the company to build a very strong strategic relationship or partnership with suppliers in order to reduce the risk of the less control.
This will definitely increase the bargaining power of suppliers and might let them be hard negotiating the prices, knowing that Boeing is looking for production efficiency to reduce the cost will not be an easy objective the company will be capable to achieve. On the other hand, if this is succeeded Boeing will have an advantage over its competitors which is a strength
3. Use new, lightweight composite materials in place of aluminum to reduce inspection time. Would
Course Instructor: Dr. Manal ElKordy Prepared By: Marwan Fathy
Submitted on: 12/01/13
1. Outsource approximately 70% of manufacturing. Could it find suppliers who could consistently make the high quality parts needed by Boeing?
Actually to outsource 70% of the manufacturing process is a very huge % and will result in facing many problems because of less control over the process attached to this high% of outsourcing. This will also considered as a high risk (Threat)the company will have to bear in terms of quality and lead time, because the more the outsource the company base its strategy the less the control the company will practice over its products.
Looking to the reasons that might be behind the outsourcing decision are as follow: Lacking the required capacity to meet forecasted demand ( weakness) Inefficient production to achieve low cost (weakness)
2. Reduce final assembly time to three days (compared to 20 for its 737plane) by having the suppliers build completed plane sections. Could this many suppliers meet Boeing 's exacting deadlines?
As mentioned above to depends heavily on suppliers who we usually have less control (high threat) over them will be always attached with high risk to meet specific standards or dead time, This will also require the company to build a very strong strategic relationship or partnership with suppliers in order to reduce the risk of the less control.
This will definitely increase the bargaining power of suppliers and might let them be hard negotiating the prices, knowing that Boeing is looking for production efficiency to reduce the cost will not be an easy objective the company will be capable to achieve. On the other hand, if this is succeeded Boeing will have an advantage over its competitors which is a strength
3. Use new, lightweight composite materials in place of aluminum to reduce inspection time. Would