This paper will discuss management’s business planning at Boeing. Boeing is an aerospace company, a leading maker of commercial airplanes, military aircraft, satellites, and missiles. Business planning at Boeing is a very complicated process because it is influenced by internal and external factors that would involve legal ethical issues, and corporate social responsibility. Factors such as economic conditions, laws, and competition directly influence the strategic, tactical, operational, and contingency planning. Boeing has been able to maintain success for many years due to their strong ethics and planning abilities.
The planning process is complicated by legal issues, which can put the company in an awkward position. In 2000, Boeing was sued over a complicated legal issue involving gender pay differential (Business Week, 2004). There was clear evidence that pay differential existed; however, attorney client privilege protected the company from liability and most of the evidence was later thrown out, in the end Boeing settled out of court and saved the company from public humiliation. Having a legal team overseeing all important documents and decisions gave Boeing the opportunity to save them millions of dollars. In this situation, it was best for Boeing to settle because it would resonate better with consumers, its employees, and the public in general.
Cooperate Social Responsibility
Boeing is a company that is respected for cooperate social responsibility. Boeing joined the Foundation for Corporate responsibility which encourages companies to get involved in philanthropic efforts and promoting ethics in business (Foundation for Corporate and Social Responsibility, 2008). Boeing has gotten involved in sponsoring corporate events such as refurbishing the lecture hall at the Royal Aeronautical Society in London, and the Chicago Air and Water Show (Boeing, 2008). Boeing has diversified its philanthropic efforts by getting involved in sports related events.
Ethics
Boeing has an extensive ethics policy that is developed to protect the corporation and its employees. All employees are required to obey all information set forth in the Boeing Code of Conduct. Boeing has a hotline set up so that employees can ask questions or report suspected violations of policy. The Finance department has additional policies they must follow since the company wants accurate reporting of all financial records. Boeing is committed to demonstrating leadership, quality, integrity, and customer satisfaction (Boeing, 2007). It is vital for policies to be followed so the integrity of plans in action are not compromised.
Economic Conditions
Current economic conditions are the deciding factor of how Boeing plans operationally, strategically and tactically. Since the United States has experience an economic downturn since 2001, Boeing has suffered due to airlines being in financial trouble. Business has reduced significantly, and Boeing has been forced to look to other countries for business, another focus has been manufacturing more planes and equipment for the military. Boeing found relief from getting a contract with U.S. Air force worth $49.2 billion (Advantage Business Media, 2007). Boeing began a business relationship with Saudi Arabia Airlines in 1995 and since has continued the increasing business with the increase of air traffic (Boeing, 2001). Boeing is making a steady effort to take advantage of the demand for aircraft in China, India, and Saudi Arabia. Future plans will revolve around the demand and global market trends.
Competition
Competition is another example of how Boeing has to plan tactically and strategically. Airbus is Boeing’s biggest competition in the industry. Currently, Airbus is the leading manufacturer of commercial jets (Yahoo, 2008). While Boeing is trying to increase their business, there is a backlog and clients are choosing to go to Airbus to meet their need immediately by avoiding a delay. Apparently Boeing is experiencing problems on their assembly line and they have made a decision to change deadlines. Airbus is experiencing a backlog due to the increasing demand due to Boeing’s backlog, so they are planning to increase their monthly output. Lockheed Martin is Boeing’s biggest competition in defense systems (Yahoo, 2008). Lately, Boeing and Lockheed Martin have worked on a number of projects together in attempt to meet a greater demand.
Government Regulations
Government regulations have indirectly affected the output of planes that Boeing has manufactured. When Boeing designs new models of planes, before they are flown Boeing must obtain a certificate issued by the U.S. Government. The U.S. Government has designed this system to make sure people are flying in aircraft that is safe. This information is taken into account in the planning process when Boeing plans each phase of development of a new aircraft. There are many safety requirements set forth by U.S. Federal Aviation Administration that planes must meet in order to be approved for flight. This can affect the overall production of airplanes because there will be a delay before a plane is cleared. Boeing has alluded to having some problems with the production of some of their planes, which will delay their release date. They are planning tactically so the plane will not face rejection at a later stage. Demand has been impacted by noise ordinances that define the hours of flight. It is very clear that fewer planes are flying out per day which means planes are lasting longer since they are not impacted as quickly by ware and tare.
Conclusion
There are many factors involved with business planning at Boeing ranging from internal legal issues, government regulations, corporate social responsibility, economic conditions, and ethics. Boeing has a legal department to assist with all aspects of planning. In addition to the planning process the legal department has a responsibility to handle all external and internal legal matters. Boeing has associated itself with great sponsorship organizations to aide them in philanthropic efforts. Corporate social responsibility is extremely important, because consumers and potential clients judge corporations based on some of the efforts set forth. All employees are expected to follow business ethics in the code of conduct at Boeing. A strong code of ethics has helped this corporation to maintain longevity in a competitive industry. Current economic conditions and competition go hand in and in planning operationally, strategically, and tactically. Due to the poor economic conditions in the United States, Boeing has signed contracts with other countries that have a higher demand for aircraft. Government regulations affect how fast aircraft is cleared for flight, which creates more delays. The planning process at Boeing is constantly changing due to circumstances in the internal and external environment.
References
Boeing. (2008, February). Retrieved February 29, 2008, from Foundation for Corporate Social Responsibility: http://www.fcsr.pl/fcsr_eng_nasipartnerzy_boeing.html
Boeing. (2001, April 23). Saudi Arabian Airlines Meets Fleet Expansion Goal with New Boeing 777 and 747 Airplanes. Retrieved February 27, 2008, from Boeing: http://www.boeing.com/news/releases/2001/q2/news_release_010423a.html
Business Week. (2004, January 24). Cover Up at Boeing. Retrieved February 28, 2008, from Business Week: http://www.businessweek.com/magazine/content/04_26/b3889088.htm
Corporate Sponsorships. (2008, February ). Retrieved March 1, 2008, from Boeing: http://www.boeing.com/companyoffices/aboutus/sponsorship/current.html
Vandore, E. (2008, January 17). Airbus, Boeing Swamped by Orders. Retrieved February 28, 2008, from San Francisco Chronical: http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2008/01/16/financial/f132334S50.DTL&feed;=rss.business
Yahoo. (2008, March). The Boeing Company Profile. Retrieved March 1, 2008, from Yahoo: http://biz.yahoo.com/ic/10/10221.html
