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Commercial jets manufacture is a very rough business, mostly run by a few major companies. Boeing was the first of them to make a step forward by introducing a state-of-the-art commercial jet aircraft model 787. It was based on the totally new approach to the content manufacture. 70% of Boeing 787 was decided to be outsourced to different countries.
Outsourcing the manufacture makes a company work a bit different from the regular order of things. The research paper will study the consequences of such outsourcing and will study the following claims:
- Outsourcing the manufacture abroad allows saving a lot on the production costs. Building a new factory in some countries is cheaper than operating a working plant in the USA;
- Outsourcing to a new country promotes sales in that country. According to Boeing company’s beliefs, the new market can be found in the country, where a certain part of the plane is manufactured;
- Boeing believes that the diverse design of the numerous components will lead to shortening of the production cycle by one third.
Besides outsourcing, another part of this case study tends to research the assembly process difficulties, caused by the following factors:
- Partner companies are located all around the world(Canada, Japan, Italy);
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- Delivery timing is different from Boeing’s, which causes delays in the overall production process and penalizing charges due to the late delivery to the customers;
- Partner companies outsource the design work to different enterprises – quality standards get violated and production timeframes are shifted.
Boeing continues outsourcing its manufacture to the different companies. However, system management program, controlling the entire production process and coordinating any further partner company actions, has to be launched. Company has to be controlling the overall process to prevent possible unwanted occurrences, leading to the unjustified extra spending, severely effecting the company’s revenues.
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