BOEING AUSTRALIA LIMITED
SUMMARY
Executive Summary
Boeing Australia Limited (BAL) an extension of the US firm developed capabilities in the areas of space and communication, site management and the upgrade and maintenance of military aircraft and equipment’s. They faced lot of difficulties in deciding to upgrade its procurement systems and process to improve operations.
In 1999 they recruited Russell Menere as the NPM (National Procurement Manager) who’s important task was to search for gains in productivity by improving procurement processes either by cost saving or by reduction in process time, to achieve this objective short term improvements were initiated. Including rationalization of a large number of BAL’s suppliers,
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Some ongoing contracts held –
• Management and maintenance of military site
• Modification and upgrade projects
• Providing the RAAF with an Airborne Early Warning And Control (AEW & C)
• Provide two new ground based air defence, command, and control and communication system.
BAL employed a top-down approach also knows as management by policy deployment. It was like where the board arrived at a vision for the company and set the targets and as a result, the next layer in the pyramid had to look whether the targets will align with what they have to do. Different ERP tools were used to keep track of all the tasks that were done by the engineers in the office and workers in the shop floor from main key activities, which in turn became the key performance indicator. Each work orders were bar coded and employees were assigned work orders depending on their skill.
The priority of Russell had to look for any gains in productivity through cost saving or reduced processing time.
Short Term Improvements
1. Rationalization and Management of suppliers
• Leveraging off the bargaining power of the suppliers – One of the main drawback, which limited BAL’s opportunities, is to leverage off its parent company’s buying power was the US government’s export procedures. All the items that had a license had to be verified, which meant the Australia was not subject to any country specific
The Boeing Company designs, develops, manufactures, sells, services, and supports commercial jetliners, military aircraft, satellites, missile defense, human space flight, and launch systems and services worldwide. It operates in five segments: Commercial Airplanes, Boeing Military Aircraft, Network & Space Systems, Global Services & Support, and Boeing Capital. The Commercial Airplanes segment develops, produces, and markets commercial jet aircraft for various passenger and cargo requirements; and provides related support services to the commercial airline industry. This segment also offers aviation services support, aircraft modifications, spare parts, training, maintenance documents, and technical advice to commercial and government customers. The Boeing Military Aircraft segment researches, develops, produces, and modifies manned and unmanned military aircraft, and weapons systems for global strike, vertical lift, and autonomous systems, as well as mobility, surveillance, and engagement. The Network & Space Systems segment researches, develops, produces, and modifies strategic defense and intelligence systems, satellite systems, and space exploration products.
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Although competitive bidding will continue to be used, especially in the public sector, to ascertain market prices for non-strategic items, many of these items will be outsourced to third-party buyers or consortia to conduct the bidding. Moreover, organizations will continue to purchase most non-strategic products and services under master contracts, some of which will be negotiated by consortia that have leveraged and buying expertise. A trend is expanding for the continued use of third-party purchasing by primarily private sector firms pursuing all forms of competitive advantage possibilities.
My decision is to continue on the same course that Boeing Australia Limited (BAL) is on. I feel, after reading this case study that BAL has been on the correct path with regard to building their systems architecture. There is a need for a more sophisticated procurement process and the issue of a procurement application may be easily found. The key is the process by which BAL has implemented all other IT applications, they have been very successful. They are thorough and have processes in place to rationalize whether a new by-in application or an in-house developed program would be best. My thought is that at least one, if not more; of the current systems have an appropriate off the shelf
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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).
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maintenance of military aircraft and equipment. As BAL grew so too did the legacy technology
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