Essay BAL case study

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Executive Summary

Boeing Australia Limited (BAL) is a global extension of the Boeing Company whose head office locates in the United States.
BAL developed capabilities in the areas of space and communications, site management and the upgrade and maintenance of military aircraft and equipment. As BAL grew, it faced difficult decisions how to improve or upgrade its procurement system and process to meet its customers’ requirement, especially its major customer the Australian Defence Force (ADF).
Comparing to the option of upgrading the whole procurement system, my recommendation aligns with Russell Menere (National Procurement Manager of BAL)’s idea, which is to implement short term improvements based on current procurement system in
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As an end user, BAL had to first verify it was eligible for a licence. A list of documents was needed to smooth the whole process for obtaining the export licences. As a result, the complicated process leveraged off the bargaining power of the Boeing Group.
2, Management of Suppliers
Applying the new policy to rationalise BAL’s supplier base over six years, BAL achieved direct cost savings by decrease the base of supplier, and the next target was 600. In order to verify whether BAL’s suppliers were authorised and qualified to produce the necessary parts, BAL needed to ensure any “flyaway” items purchased or manufactured had complete traceability.
Also, without an effective supplier monitoring and feedback system, it was difficult for BAL to find consistent ways to measure the levels of service.
3, Drawbacks of Existing Purchasing System
The process efficiency of purchasing order release was also restricted by BAL’s existing IT system. Though BAL had capability to electronically cut purchase orders to larger suppliers via web-based online tools developed by these suppliers, BAL’s current legacy system was not supporting its interfaces connected to suppliers’ web browsers and thus resulted extra manual work to feed ERP system.
4, Budget Constraints and Size of the Company With limited budget to spend for upgrade, BAL had to consider a more rational way to improve current system. In addition, regarding the company size, there wouldn’t be economy of scale at
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