Boeing Company, whose headquarters is based in Seattle, was first founded as a company providing pacific aero products, in the year 1916. Its product line includes military and business airlines, commercial aircrafts, electronic information systems, space systems and tactical weapon systems. Since its inception, the company has been providing the best services to the market segment that it serves. Its history can further be divided into two major periods, the piston era and the jet age. During the piston era, the company was basically a contractor with the military especially during the fighter aircraft of the 1920s and 30s. This also extended to the World War II. In the jet age, which began in the 1950s, the company became the largest manufacturer of aircrafts which operated on commercial basis and therefore the company was contracted to deliver a large quantity of jetliners (Buntine and Fisher, 1994).
Its mission statement is to encourage cooperative efforts at every level and across all functions and activities of the company; build a diverse and teamwork by utilizing the skills, strengths, experiences and different perspectives so as to improve the quality of its products.
The business the company engages in is that of manufacturing airplanes. Its product line includes military and business airlines, commercial aircrafts, electronic information systems, space systems and tactical weapon systems. It is the world’s largest defense and aerospace company. It operates in more than 90 countries. It is America’s largest exporter (Yenne, 2004).
The customers of the Boeing Company mostly are the governments of various countries. The government deals with defense of the country. For instance during the Iraq War, it caused boom since its products were needed by the US government especially the military aircraft and the space and tactical weapon systems. Some companies are the customers too for some aeroplanes, but the government remains the major customer because it has resources to purchase these expensive defense aeroplanes. The customer values the quality of the aircraft, durability and unfrequented mechanical problems. The company’s aircrafts are reliable; hence its proposition value respected all over the world (Yenne, 2004).
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- The product offers great and varied features of the product and besides it offers other products which provide the same services. This is strength because it can compete favorably with other companies in the same industry such as EADS NV (EADSY) and the Airbus liners (Diane Publishing Company, 1994).
- The global location presence. Boeing Company is located in The United States which is a very strategic place in terms of creating a bigger market and at the same time it is known to be a country with a lot of technological advancements which are suitable for introducing the product into the market globally.
- Strong advertising and promotional campaign. The recent developments in the use of the internet have made sure that the product can be viewed over the internet making it possible for a greater percentage of individuals to be reached in many countries.
- The company has a highly recognizable brand name in the whole world. Individuals get identified with this product because it is a unique product (Yenne, 2004).
- Inability to differentiate its products i.e. lack of development of innovative products which would suit their customers has hindered its international expansion.
- Lack of proper marketing and promotional strategies and actions has also affected its going global.
- The constant changes taking place within the society has hindered the development of this company thus leading to lowering on incomes (Diane Publishing Company, 1994).
- Due to the use of the internet, there is a negative press associated with it including negative behaviors which are often associated with the youths. Most governments want to transact business online and to know our products through the internet.
- The continued R&D has made the company to improve in the quality of the products they produce; hence has made it to enter into global market very easily.
- The use of the internet has allowed the company to be recognized and known throughout various countries and states (Yenne, 2004).
- Technology and innovation within the development of the product and during the process of marketing and manufacturing of its products is also an opportunity to go global.
- The current trend in technology has proved to be an opportunity since in trying to be in a brace with technology, the company has been involved in various improvements of its products.
- Innovation within the product development and variety of choices in store in most countries.
As the company expands to other countries or globally, there are some eminent threats which has been hindering its expansion to the international market. These include:
- The highly competitive and mature marketplace implies that the products that this company offers pose threats to the company as it penetrates into the global market.
- The company is sharing the market with stiff competitors like Airbus and thus faces a threat of production of quality products. This has been a major threat to the company it faces in the international market (Diane Publishing Company, 1994).
- Because the company produces a highly substitutable product, customers can go for other companies which offer these products; hence a threat to its expansion globally.
- The continued inventions and innovations are a threat to this product since new and appealing features on the products are being introduced, a scenario which may mean substituting this product. Innovation and creativity leads to change in technology which is very expensive or costly to the company. Technology is rapidly changing which means that, if Boeing company failure to adjust and adopt the new technology it might be wiped out of the market by the competitors (Yenne, 2004).
Step 4: Problems/ challenges
The management has also been facing several problems which stem from poor communication between the employees and the management. The management structure of the company for a long time has not allowed the employees to have a connection with the managers, implying that problems which come up are not handled in the appropriate way.
Although the company is competent in its operations, the main problem that is faces is the strong force which is posed from the competitor’s side. This has challenged the company in coming up with better strategies which are aimed at achieving the set goals. The other problem which the company faces is the production of outdated products which no longer fetch a good market. The growing world implies that there is a need for proper strategies in place. This is a challenge to the company as it tries to open new branches in other countries (Buntine and Fisher, 1994).
So as to stay sustainable, however, the company expects to maintain several strategies. The first strategy is developing a good marketing strategy which is aimed at reaching many customers in the market. Marketing is regarded as a very important aspect that every company should put in place. The marketing strategy involves using the new technologies so as to reach many people across many countries in the world with information that is appropriate and most relevant (Diane Publishing Company, 1994).
The other major problem that this company’s management faces is the high costs of operations which the company has been facing over the years. In several instances, the company delayed in paying of its taxes, thus they faced a lot of penalties. The high cost of purchasing materials for manufacturing the planes increased the production costs of this company which also meant a reduction in its profits.
Sustained Competitive Advantage
The competition from the various companies offering the same products has made this company to achieve its success. There is a stiff competition from companies which offer related products and are closely monitoring the development of this company. With the new strategies, however, the company expects that it is going to obtain success and be at the expected level of success as it goes international (Diane Publishing Company, 1994).
Human Resource Management
The human resource development within the Being Company is highly developed. The company provides the employees of the company with a wide range of tools and services which offer them a great experience in life. The human resource management of Being Company has a great pressure to attract and retain its workers in the world. About 20% of workers in the company today are in their eligibility age of retirement. In five years time, another 20% will also be in such a situation (Yenne, 2004). The company has put in place several strategies which are used in recruitment of its employees because the company is concerned with obtaining the best employees in terms of provision of quality and professional services in the world. The human resource manager’s aim is to be able to have the best employees in the organization, develop them and provide for them the best environment in which they can work and provide the best services. The company has therefore been in the move to providing the best environment for these employees, an environment which provides the leaders with a chance to create dialogue and competitive benefits (Buntine and Fisher, 1994).
The company has further been using strategic methods so as to retain its employees. There are special training sessions which are provided so as to decide on whether to promote the employees from one level to another. Once some form of hard work and improvement has been identified within an employee, the human resource management often rewards such an employee. Rewarding can be in form of promotion, remuneration or transfer from one center to another (Diane Publishing Company, 1994).
As a way of maintaining the existing employees, Being Company has designed many strategies which are aimed at improving the lives of its customers. Some of these ways include providing insurance coverage benefits for these customers, improvement on training services, functionality excellence program and dependent eligibility verification program. Because of these services, the employees in this company have developed a very good attitude towards the company (Buntine and Fisher, 1994).
The company uses the most current technology in the development of its products. The 777 model was the first plane of its kind to be fitted with computer aided machines (Buntine and Fisher, 1994). The company utilizes the most sophisticated computer aided program which was borrowed from the Dassault Aviation, a company from France which offers building of planes. With an improvement by the IBM Company, Being Company today uses a technology that allows for image manipulation, connection of its 2,200 computer terminals with the mainframes. The advantage that the company has seen through the introduction of this technology is that it provided its engineers with 100% visualization since it allowed for zooming, rotation at all angles and interrogation of parts in a geometrical manner. The company became one of the first airline industries to be honored by being awarded the Annual Computerworld Award in 1993 by the Smithsonian Institution.
The company has further introduced the use of its website www.boeing.com, which gives the basic components of the company and customers can reach them all over the world. Through this website, customers have been able to obtain information regarding the company without having to visit the company itself. The company has therefore been able to deal with a competitive and an economic conscious environment. The website basically provides information like logistics and spares support, global customer support, fleet modification and enhancements and flight engineering and maintenance services and maintenance and engineering services (Diane Publishing Company, 1994).
The main objective of developing this site is to be able to allow potential and current customers to access financial, technical and assistance in areas that they feel they are not satisfied about the company. The site further provides a chance for the potential customers to virtually tour the company and look at its products in detail including pictures of commercial aircrafts and planes. Boeing website further provides information on various topics like safety reports on the airport, noise regulations and rules of flight and alighting. Subsidiaries like the SBS International, Jeppensen Industries and Aero Info also rely on this website since it provides them with links (Buntine and Fisher, 1994).
The company obtains several services and products from several companies which are based in about ten countries and about twelve states in America. The company therefore relies on outsourcing as a means of obtaining the best quality products. Outsourcing within this company started with detailed parts such as stamped airframe and machined components. The president of the company explained that, that was a step towards a cost competitive environment (Yenne, 2004). It foresaw that this was possible because of the small, talented shops which would provide faster and cheaper services. Because of this shift, the company does not involve itself in such services as forming or metal cutting. They have designed small shops which are designed to do so. The company relies on sub-contract base in its operations. It boasts of outsourcing of all its machine and machine sheet metal parts which are detail
Boeing Company is known for having a diversified business culture which contributes to the multiple competencies, making the company exceptional in provision of its services. Some of the core competencies that the company identifies with include large scale systems integration, detailed customer focus and knowledge and a lean enterprise. With an objective to understand its employees, the company is focused at handling the needs of the customers when they come up. The marketing manager introduced a concept known as ‘market shaping’ which is aimed at understanding where the customer is heading at, creativity within the company, giving the right products services and utilization of technology within the organization (Buntine and Fisher, 1994).
The enterprise is also aimed at maintaining a lean enterprise which is characterized by using its assets effectively and efficiently, maintaining an excellent supplier management, keeping a high inventory turns and maintaining a low transaction cost as well as a high quality of products. Boeing Company is continuously developing a system which is technologically supported and which allows for an integration of the systems in place within the organization (Yenne, 2004). This company is often regarded as the R$D strategy where the design partners and suppliers use the same set of data in coming up with the manufacturing plan of the organization. The success of the technological development of Sonic Cruiser concept airplane is an example of a technological advancement that the company so far achieved successfully.
Boeing Company has utilized several resources so as to obtain success as it goes global. These resources include physical, financial, human resource and organizational resources. The company has therefore strategized on how to obtain these resources and how to keep them so as to have a sound business. The resources which are deemed to be physical, for instance are obtained from other countries which are producers of aviation products. The human resource is drawn from the highly skilled population of experts who work in the company. These experts were drawn from very reputable companies or have been working with the company for along time and have therefore gained a lot of experience. With this therefore, the company has been able to achieve success by maintaining its business and maintaining it in high standards and maintains its competitiveness globally (Buntine and Fisher, 1994).
By going global, it can resolve the various problems facing the company. First, it will expand its market base; hence gaining the competitive advantage over other companies competing in the same industries. Secondly, controlling a larger market, revenue (profits) will increase; hence the rapidly changing technology can be adapted easily because the company can afford the new technology in the market (Buntine and Fisher, 1994). Thirdly, by going global, the company can avoid many threats and risks because it can scan the environment that will help to identify these threats and risks. This will help to be prepared strategies on how to deal with them. Some external threats such political, legal and economical can be known in advance (Yenne, 2004). The company will also reduce the traveling and handling administration work in one central place. This will therefore reduce delays in the delivery of the products, improved administration and easy marketing because the company marketing department will get first hand information from its customers in different countries.