The Courage Behind Boeing's Dreamliner Project
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I'm sure many of you heard about the Boeing 787 Dreamliner that made its first commercial journey on 26 October. It is the most technologically advanced commercial airplane and enables air travel that is cheaper, faster and more comfortable.
Perhaps you also heard about the process, communications and quality issues that delayed the project by three years and cost the company close to US$10 billion in overrun charges, according to the business news outlet Bloomberg.
As a project manager, what jumps out to me is the fortitude of Boeing's management to ensure a quality product -- despite extraordinary pressure.
I have no doubt that if it had wanted to, Boeing could have completed this project earlier. But rather than take shortcuts and risk potential issues, it held out for a product that met its standards.
Much attention has focused on Boeing's attempts to save money and to secure global accounts by outsourcing a large portion of its component manufacturing and design. The idea was that assembly and time to market would be accelerated by allowing various parts of the plane to be flown to Boeing's facility in Seattle, Washington, USA. There, they could be pieced together in order. According to news reports, the move initially netted Boeing nearly 1,000 orders and helped keep its prime competitor, Airbus, at bay.
But it marked a big change in Boeing's existing process to keep almost all of its engineering design in-house. The company typically delivers very specific "build-to-order" instructions to its manufacturing partners, outlining specifications and direction, and then collaboratively designing the parts.
There were many challenges associated with a project as complex and pioneering as the Dreamliner project. One example is the process for oversight and quality control of multiple, globally based contractors. Issues arose, such as contractors subcontracting to suppliers who couldn't meet deadlines or quotas. In other cases, contractors shipped parts that wouldn't fit together correctly.
Think about it: In my opinion, Boeing realized that it was more important to get the project done right versus done fast. And while the company has faced criticism, suffered some embarrassment and, yes, spent more than it anticipated, these are all short-term issues.
In the long run, I believe the project will bolster Boeing's reputation for quality. It will also have finely tuned a project management process that should bring the company much higher returns in the future.
See more posts from Geoff.
Posted
by
Geoff Mattie
on: November 16, 2011 09:14 AM |
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Brett Bassett
Program Manager II| MBA CSi
Ashburn, VA, United States
For reference, I think it should be pointed out that Boeing was thought to spend about $10B in development if the used traditional design/supply chain strategy. They had consultants tell them that they might only spend about $6B in development using a 3-tier global supply chain and have the suppliers invest their money into the "venture". They ended up being over budget, but the development costs ended up being closes to what it would have been if they went the traditional path. So, one could say they went over budget taking on more risk. Or, that they spent what they thought they would have anyways (roughly speaking).
Also, as Monte touched on, many of Boeing aircraft development projects included large investments and risk, but they usually ended up increasing net income overtime. If you look now, you might see the Dreamliner is doing better and Airbus (competitor) is trying to do more to be more competitive with their features. So, even if they had failures as a project, it still may have helped them launch a program that has had some success,
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