Management Planning – Boeing’s Future On Track

Researched and Authored by: Michael J. Spindler of Local Music Hits

The Boeing Corporation has a unique organizational structure which consists of essentially two business solutions that are tied together via nine levels of corporate functions. The two businesses are Commercial Airlines and Integrated Defense Systems. From the top to bottom, the corporate functions that govern this corporate machine are, Business Development and Strategy, Communications, Engineering, Operations and Technology, Finance/Shared Services Group/Boeing Capital Corp., Human Resources/Administration, International, Law, Office of Internal Governance, and Public Policy. For a company that employs over 150,000 people across 71 countries, this can be a daunting task, and it all begins with and ends with Business Development and Strategy.

The driving force behind the Boeing Corporation is of course the stakeholders, which include: Customers, Employees, Shareholders, and Communities. The management model used to direct the companies planning and focus is simple but effective method for planning, acting, analyzing, and reinforcing methods that produce results. These are driven by Boeings aptitude to encourage growth and leadership from within the organization. By making employees share in both the successes and failures of the company, Boeing in turn receives: committed, performance-driven management at all levels. This is achieved primarily by preparing employees through education throughout the organization and then to apply knowledge as defined by the following model.

1. Define financial objectives, while producing high quality innovative products, and minimizing the impact to communities and the environment.

2. The Initiative Toolkit – Customer Satisfaction and Growth in productivity are always in a state of balance and realignment.

a. Growth in customer satisfaction.

b. Growth in productivity, advancing processes and technology while remaining competitive.

3. Financial Performance – This is the stage in which the company evaluates how economic profits are affected by decisions in the previous step of maintaining or fostering greater customer satisfaction and growth in productivity. It is in this stage that an analysis is done to compare the original financial objectives and how these two areas are impacting the goals of the company.

4. Delivered Results – Stock Price and Performance to Plan

a. Stock Price – An evaluation of how previous action, corrections, and implementation, have affected the stock price of Boeing.

b. Performance to Plan – This is where employee accountability is accounted for and the impact that it has had on the Financial Performance that has either enhanced or degraded to original vision set forth in the Financial Objectives set by executive staff.

5. The last step is in how the plan has been executed and how that impacts all parties with a vested interest with the company. This includes employees, customers, shareholders, and the numerous communities that are directly impacted by the economic security a company this size will have on the region. (Boeing Corporation, 2007)

The Boeing Corporate headquarters, based in Chicago Illinois, is where the previously outlined model is implemented, analyzed and altered according to needs and changes. The primary focus includes Growth Strategies in the global market, financial goals and performance, leadership development, and of course ethics and compliance. It is also a depot so to speak where sharing best practices, technologies and productivity improvements are pooled. This is a critical area as it is of tremendous value in determining the course of the company and identifying areas of that could use improvement.

Factors that influence the company’s strategic, tactical, operational, and contingency planning include innovation, profitability, and environmental concerns. Of course there are numerous other issues to consider that have an affect on how business is focused. In consideration of short duration of this paper, these three have been chosen as the focal points.

As Boeing is the industry leader in commercial and military aircraft, as well as launch platforms and satellite technology. Great care and continued education of employees at all levels is encouraged to help the company creatively resolve technical barriers that may stand in the way of pushing technology forward. Considerations to take into account are capitol investments, human resources and time. The products that could be developed need to be assessed for marketability, feasibility, and cost effectiveness. The base question is always, will investment into these specific products open doors for profits, and if so, what time frame could the business expect to see a return. Of course there is a myriad of question as to if the product aligns with current visions in place, and is in line with the direction of the industry that the company is focused on.

The products that Boeing selects directly impact the profitability of the company. Concerns once again are into research and development, and durations between innovation and returns on investments. Boeing currently has three major areas of focus in business. The commercial airline and the integrated defense systems compose of 97 percent of the total earnings for Boeing. While 70 percent of the airline manufacturing is to foreign sales, the balance and cross over of technology developed in one division and applied to the other help to keep Boeing profitable and competitive in this industry.

“One of Boeing’s many strengths is the company’s deep commitment to involving customers in all phases of planning and operation.” (AQA, ) It is the customer that Boeing is here to serve. Boeing’s ability, to bring a product of highly complex systems customized for airline and aerospace industries, is what makes planning and operations that much more multifaceted. This flexibility provides an environment where pushing technology to a new level is customer driven. We would still be flying in biplanes if it were not for the industry serving the customers needs. The customers’ needs are to provide services to their own customers with these improved technologies that give them an edge in the market niche. Of the bigger customers the United States government, a direct correlation can be drawn through how technology developed for military use, can be applied to the commercial airline business to make for a safer airline industry. These improvements translate into a burst of consumer confidence as air travel has become safer over the years. This ability of engineers, designers, and customers working to achieve a common goal is one that requires great leadership at every level of the organization.

In regards to environmental concerns, air traffic makes up only a small percentage of the air pollution produced by the world. However, as fuel costs rise, and clean air has become a priority. Boeing has “improved airplane fuel efficiency by 70% over the past 40 years, with a corresponding reduction in CO2 emissions. Current models also are 75% quieter than airplanes 40 years ago” (BC, 2007). Not only does this improve Boeing’s corporate image to the world, but efficiency means lower costs to the final people involved, the consumers. Without whom, Boeing would not have a purpose to exist.

References – Do Not Strip Article References

AQA (). BOEINGBoeing (formerly McDonnell Douglas Helicopter Systems). Retrieved November 1, 2007, from http://www.arizona-excellence.com/Member_Profiles/Boeing.html

Boeing Corporation (2007, October). The Boeing Company. Retrieved November 01, 2007, from http://www.boeing.com/companyoffices/aboutus/overview/powerpoint/boeing_overview.ppt

Researched and Authored by: Michael J. Spindler of Local Music Hits

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About the Author: Michael J. Spindler Michael has a multitude of interests, from Local Music Bands, Arts, Psychology, Sociology, Business Techniques and many more… As time goes by, most of my articles will focus on the world of Local Music. But at this time, I would like to share with you my other varied interest.

New Financing Options

Strategic partners can be venture capitalists who want to take your small idea and make it big. It can be about silent partners who will offer cash backing for a share in revenue or stock. Having more than one person who is helping to grow the business offers more alternatives for cash financing when the banks decide to say “no.”

Increase Your Offerings

Seek out businesses with complementary offering and create a strategic partnership to promote each other’s products for a share of the profit. This will make your business appear bigger, attract more clients, and offer you new ways to make money, even when it’s not your product that you are selling.

Expand Nationally or Internationally

Taking a small company and growing to a larger geographic area is a very complex undertaking. You need to have strategic partners willing to grow your distribution system. If you are taking it internationally, you also need to have partnerships with people who know the customs and traditions in the new country so that they can help you with exporting and repackaging. You can also do this as a strategic partnership with a larger company that already has established a network of distributors and just wants to add some of your product line to their offerings.

Their members are concerned about jobs and how to hold on to jobs; small businesses are usually the last businesses to make employees redundant. The calls are asking how to make employees redundant, how do I do it, what action should I take, this is extremely worrying when it is thought that 32,400 business may go bust. On average each small business employees approximately 5 members of staff; this means that 150,000 people could lose their jobs from small businesses this year.

The federation of small businesses is the voice of small and medium-sized businesses in the UK; they have over 215,000 members, who employ more than 1.3 million people with a combined turnover of £10billion. The federation of small businesses are proposing a five point plan. They believe that small business can help to get us out of this recession if the government were to give small businesses more contracts, the government improves employment paperwork, government improves access to traineeships or apprenticeships and improves the position of the banks giving money to small businesses. This will rely on the bank mangers releasing and relaxing the money supply to small businesses and not having a knee jerk reaction to this recession. As quoted by Stephen Alambritis.

This government under Gordon Brown and Alistair Darling need to realise that small businesses are the back bone of the economy and that they need to ensure that this recession is as short as possible. To do this they need to spend copious amounts of money to implement a massive job creation programme to keep unemployment down and taxation revenues up. Then hopefully we may ride out this recession!

It’s not just a case of the government supporting the Banks and the Car industry; we need more far reaching initiatives for employment across the economy. The recent incentive released by the government was to assist employers recruiting people who had been unemployed for six months or more. This initiative is flawed as the government will provide £2,500 to employers for training any new recruits as long as the new employee has been unemployed for more than six months. So now employers may be tempted to only recruit people who have been unemployed for six months or more for the additional money that is available.

Gordon Brown and Alistair Darling should look across the pond to Barack Obama’s newest policy to create 3 million new jobs in America. This initiative is expected to cost some $850 billion to implement along with other help offered to their car industry and the banking sector.