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Agenda
The Boeing Company
Background/Five Forces Analysis
BoeingThrough theYears
J uly 28:
World War
I Begins
1914
1916
J une15:
Boeing
took B&W
Seaplane
for first
flight
1917
J uly 15:
Boeing enters
commercial
aviation with
the Boeing 707
1939
Sept 1:
World
War II
Begins
1954
May 17:
Delivery of
the first
Boeing 777
to United
Airlines
Dec 1:
Airbus
enters the
market
1968
April 29:
Thornton T
Wilson became
President forced
to cut workforce
from 105,000 to
38,000
1970
1982
Feb 19:
The
Boeing
757
makes its
first
flight
1995
J une17:
Boeing unveils
their new
strategy eEnabled at the
Paris
International
Air Show
Airbus
outsold
Boeing for
the first
time
1996
Dec 15:
Boeing
mergers
with longtime rival
McDonnell
Douglas
1999
2001
Sept 11:
Terrorist
Attacks on
the United
States
2003
2004
J an 14:
Connexion
by Boeing
begins
commercial
service on
Lufthansa
Airlines
Background
Founded in 1916, Boeings first customer
was the government of New Zealand
George Conrad Westervelt and William
Boeing built planes as a hobby
The first plane, named the B&W Seaplane
was used for pilot and airmail
Boeing became the largest aircraft
manufacturer
in the US during WWI
and WWII
Background
In 1954, Boeing successfully entered
commercial aviation with the Boeing 707
Unfortunately, 1968 brought crisis to the
aviation industry and the company was
forced to lay off 60,000 employees
In the 1970s Boeing regained profit by
releasing several new 7-series models and
becoming an industry leader
Brand Evolution
Suppliers
Buyers
Low For many years Boeing has
been one of the leading aviation
manufacturers in the worldwide
commercial airline industry.
Rivalry
High - The commercial airplane
marketplace is a duopoly
market, largely Airbus and
Boeing, resulting in low profit
margins in the airline industry.
Substitutes
High The passenger airplane can be
substituted with a train, a ship, a car, a
helicopter or a private jet.
Case Questions
1. As case background, discuss the
challenges and opportunities that
Boeing faced in the late 1990s.
2. What steps did Boeing take in its journey
to build its e-Enabled Advantage?
3. Is the e-Enabled advantage a
sustainable advantage and, if so, for
how long?
4. What recommendations do you have for
Scott Carson, leader of the companys eEnabled Advantage initiatives?
Challenges
Opportunities
# of orders
(1999)
355
476
# of deliveries
(2003)
281
305
Vision 2016
An integrated aerospace company and a
global enterprise, designing, producing,
and supporting commercial airplanes,
defense systems, and cival space
systems.
Run a healthy core business
Leverage strengths into new products
and new services
Open new frontiers
1. Maintenance performance
toolbox
2. Airplane health management
(AHM)
3. Electronic Flight Bag (EFB)
4. Electronic Log Book
5. My Boeing Fleet
6. Connexion by Boeing
7. Solutions Consulting
Steps to e-Enabled
1. Problem with differentiation from
Airbus
2. Management strategy formulation
3. Communication of new changes
across the company
4. Strategies communicated to
individuals business units
5. Intelligent acquisitions
6. CAS (Commercial Airlines Services)
7. OLAN (Online Local Area Network)
IT Utilization
IT will serve as the main driver of
Boeings sustainable advantage
Employ highly competent IT leaders
Institute a lean, yet agile infrastructure
Embed IT into existing products/newly
launched services
Will drive revenue growth
Creates high switching costs
Sustainable Advantage
Provides information-enabled products
and services
Information is easily customized
Drives asset efficiency, cost savings, and
revenue growth
Unpredictable lifespan
As long as Boeing maintains innovation
capabilities and leads technology
growth
Recommendations
1. Boeing must implement the consultative
selling approach and provide services that
move toward a partnership relationship
with customers. This involves altering the
business plan to fit the demands of the
environment.
2. Boeing needs to emphasize the
importance of communicating the value
of e-Enabling to their customers.
3. Boeing must utilize large scale system
integration to equip all products with the
IT capabilities associated with e-Enabling.
Any Questions?