Introduction Boeing Company has been and is still at the forefront of the aviation industry. The late 1990s were a time of trial and transition where the company encountered and overcame a number of obstacles, but also took advantage of opportunities for growth. In particular, the area of new technology has allowed the company to integrate and reorganize very effectively. In this way, customer brand loyalty has been fostered anew by adding value and by differentiating Boeing itself from its competition (particularly Airbus), as we shall see further on in the essay below. Analysis The Boeing corporation had been a very successful company in the mid-1990s. At the time, it dominanted the market in commercial aviation with an additional thriving sideline in the military and space contracts market. Boeing faced and then overcame a huge number of challenges but also took advantage of many opportunities that were offered up by the aerospace market in the late 1990s. The company faced a number of challenges. In wake of he the first Gulf War, the incumbent economic slowdown severely decreased the market demand. Also, the Boeing encountered stiff competition from the company Airbus which many experts have attributed to heavy subsidies by European government that gave the company an unfair advantage market advantage. For instance, in 1999, Airbus outsold Boeing for the first time in the company's history and delivered to the market more airplanes than the Boeing company did in
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.
With only a few large companies across the globe (Boeing, MD, and Airbus), the commercial aircraft industry essentially exhibits the qualities of an oligopolistic competition with intense rivalry. Here is an analysis of competition in the commercial aircraft business using Porter’s Five Forces.
The industry environment was also in Boeings favor at the time. Boeing had a history of dedicated customers. The company had been making commercially successful jet aircraft since it first developed the “707”. Boeing was so successful at manufacturing the jet aircraft, that it was one of two companies left making them. This advantage gave them the ability to be a powerful supplier. The expense of the development process also made it extremely difficult for new companies to even enter the market. Boeing faced only one competitor at this point; Airbus (Pearce, Robinson, 2003).
Boeing makes an effort to be well aware about the needs of their customers which is why they conduct customer surveys. After the 2007 customer survey Boeing knew where they were progressing and where they lacked.
The Boeing Corporation is the world’s leading aerospace company and is the largest manufacturer of commercial jetliners as well as military aircrafts. Boeing has teams that manufacture missiles, satellites, defense systems, and communication systems. NASA turns to Boeing when they need something and Boeing operates the International Space Station. Boeing has a broad range of capabilities and skills, which is probably the reason they are the world’s leading aerospace company. With the Boeing headquarters in Chicago, more than 170,000 people in 70 different countries find themselves employed with the corporation and
Strategy #1 The aircraft market is extremely competitive, even though there are less than five major players globally. Between Boeing and Airbus, most of the market share for the next generation aircraft has already been solidified. For Bombardier to effectively gain orders it must make the aircraft are more appealing to purchasers in two major ways: cost and performance. In the final cost of an aircraft, a great deal of money is spent on research and development. Boeing has millions invested in new aircraft and wing design, and piggy-backs off its other divisions and aircraft offerings. Airbus receives a great deal of benefit from its govermnet contracts
After sucessfully selling military aircrafts adapted for troop transportation in the 1950’s and introducing commercial aircrafts model 707, 727 followed by 737, Boeing has since then become a leading producer of military & commercial aircraft.
Dominating the commercial aircraft market for decades, Boeing is considered to be the most highly competitive U.S aerospace industry. “U.S. firms manufacture a wide variety of products for civil and defense purposes and, in 2010, the value of aerospace industry shipments was estimated at $171 billion, of which civil aircraft and aircraft parts accounted for over half of all U.S. aerospace shipments. The U.S. aerospace industry exported nearly $78 billion in products in 2010, of which $67 billion (or 86% of total exports) were civil aircraft, engines, equipment, and parts” (Harrison, 2011). However, its position of influence has lessened in recent years. This is due to its main competitor, Airbus, who in recent years has made significant
Boeing’s management plan shows determination to improve through creation of new more members of their airplane family (commercial airplanes). This would also be achieved through integration of military platforms, systems for defense and the war fighter by use of network-centric activities. Boeing plan is also inclusive of creation of improved technology to solve problems across all business units. Boeing plans to e-enable airplanes where automation is the key to this development. Finally, Boeing is determined to arrange for financing solutions to its customers. Through this it will be able to attract more potential customers. Moreover, it can also be able to establish a better relationship with its customers through provision of incentives and sales promotion.
THE BOEING COMPANY: STRATEGIC AUDIT I. CURRENT SITUATION A. Current Performance Boeing performance has been outstanding for the past few years. Their Return on investment rose from three percent to 6 percent from 1998 to 1999, but it did drop to five percent in 2000. In 1996 Airbus claimed 42% of the market share, while Boeing had 64%. Boeing is looking at falling below the 50% mark. Boeing's profits have been doing quite well. They have risen drastically in the past few years, which can be seen in the profitability ratios. Boeing is doing fine when it comes to profitability, even though they have dropped slightly since 1999.
Boeing was recently faced with the scandals which hurt the reputation of Boeing. The top management recognized the problem and tried to figure it out by effective management strategies.
By looking at all the data showed by the case we can realize that the worst company in the industry of aircraft manufacturing was McDonnell Douglas because it confronted serious financial problems since 1980s when Airbus squeezed its market share. In 1984, MD's fleet comprised 28% of aircraft in service, by 1989 had only 23% of the worldwide fleet, while for example Boeing had 53% in the same year; in 1990 Boeing had 45% of the market share while Airbus had 34% leaving only 21% of the market to MD. The strongest company was Boeing which cover about 70% of worldwide demand, nevertheless the Airbus Industry was
With any company, organization, or corporation the first phase of any management is planning. This phase is very important to any company because many different planning functions and each planning function create a standard for each of its employees to follow. This paper will discuss the planning functions of management while looking at the Boeing Company. While looking at the different planning functions, this paper will also discuss and identify legal, ethical, and social responsibilities that impact Boeing. It will also show some factors that influence Boeings strategic, tactical, operational, and contingency planning. Boeing can be considered the
The Boeing Corporation is one of the largest manufacturers in the world. Rivaled only by European giant Airbus in the aerospace industry, Boeing is a leader in research, design and manufacture of commercial jet airliners, for commercial, industrial and military customers. Despite enjoying immense success in its market and dominating an industry that solely recognizes engineering excellence, it is crucial for Boeing to ensure continued growth through consistent strategy formulation and execution to avoid falling behind in market share to close and coming rivals.
Boeing is a world leader in the aerospace industry. At one point they were the highest seller’s commercial aviation with no competition in sight. That all changed, and soon Boeing had to change.