Boeing Supply Chain Management Essay

1583 Words Feb 2nd, 2014 7 Pages
4-3 Short Paper: The Boeing Company A supply chain is a series of integrated processes within and across a company that produce a product or service to meet the demands of a consumer (Krajewski, et. al., 2013). Every company has a specific supply chain design and this design is implemented to meet the company’s competitive priorities. Supply chain management refers to the coordination of the company’s processes with those of customers and suppliers to match the flow of services, materials, and information with customer demand. In today’s global market companies are choosing to outsource many of their processes in order to save time and money. While outsourcing and decentralizing many supply processes may seem to be more cost effective, …show more content…
As a result the company spent millions of additional money shipping large engine parts to suppliers across the world to ensure proper design and fit. The aircraft also had quality issues with their lithium-ion batteries, which continually overheated causing them to ground the entire fleet until the issue was resolved (Denning, 2013). The majority of the supply issues were not a result of a poor supply chain strategy rather ineffective implementation of the tools necessary to make such a strategy work. Effective communication and collaboration with suppliers is essential with any supply chain (Krajewski, 2013). Suppliers must be chosen based on performance a criterion that has been predetermined by the company. Supplier selection is one of the most critical decisions for supply chain manager. Suppliers are a direct reflection of the company for which they supply and as a result should be chosen carefully. The supplier must be able to ensure consistent quality, timely delivery, cost efficiency, and reliability. According to Denning (2013), ”What we do know is that the cost-cutting way that Boeing went about outsourcing both in the US and beyond did not include steps to mitigate or eliminate the predicted costs and risks that have already materialized” (para. 9). Boeing did not choose suppliers who had a proven history of consistent quality, cost efficiency,

Related Documents