Bo(e)ing

Neat article in BusinessWeek about problems with the new Boeing 787 Dreamliner. This falls into the “I find this stuff fascinating but recognize that many readers don’t care about how some/most/all industries work.”

The article discusses the new model of production that Boeing’s trying to implement for this plane. The company’s engaged in a variety of outsourcing that it hasn’t really tried before, and that may be tied directly to the technological hurdles that the new plane is facing:

Boeing has undertaken a grand business experiment with the Dreamliner. In a bid to tap the best talent and hold down costs, the aerospace icon has engaged in extreme outsourcing, leaving it highly dependent on a far-flung supply chain that includes 43 “top-tier” suppliers on three continents. It is the first time Boeing has ever outsourced the most critical areas of the plane, the wing and the fuselage. About 80% of the Dreamliner is being fabricated by outside suppliers, vs. 51% for existing Boeing planes.

The Dreamliner’s mounting challenges call into question whether such a radical business model can succeed, and whether the advantages of collaboration on such a scale are outweighed by the loss of logistical and design control.

My day job is editing a magazine about outsourcing in the pharma/biopharma industry, so I wonder about how other industries manage this stuff. It’s not the commodity-level transactions that are interesting (like sourcing your wiring or excipients from a provider), but the question of how you look out-of-house for the more integral aspects of product design and development.

Now, for smaller biopharma companies, that’s a functional necessity, since they don’t tend to have the infrastructure to develop things themselves. But when it comes to aviation, in which there are really only a pair of major players left, it’s gotta be a much dicier proposition.

In this instance, the fuselage cracked.

One Reply to “Bo(e)ing”

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.