Essay about Boeing: Managing Challenges

Submitted By komalpriya808
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In the News
Boeing flying in Turbulence – Managing the Controversy

By
Team 2

Anshuman Ghosh

Dave Orellana
Komal Priya Karuna Moorthy

Hashif Hussain

Melody Ottong
Yujing Zhou(Sophie)
MGMT565
Royal Roads University

Contents
1

Introduction

2

Problem Definition

3

Challenges

4

Alternatives

5

Analysis and Evidence

6

Counter Argument & Rebuttal

7

Recommendation

8

Conclusion

Introduction
What they do?
•

Incorporated in 1916 at Washington US

•

Engaged in Design, development, manufacture and sales of air planes in
–

Commercial Sector

–

Defense

–

Space & Security

Turn-over
• Total revenue in 2012: $81.7 billion
• Manufacturing, service and technology partnerships with companies around the world

System
•

Research, design and technology-development centers in many countries
–

More than 170,000 Boeing employees in 50 states and 70 countries

–

Contracts with 26,500 suppliers and partners globally

What is the Problem ?
Boeing’s position as the leader in aerospace industry is threatened by its new contract IAM 751(International Association of Mechanics and Aerospace
Workers) with the Union.

Contract entails
Reasons for strike

Union demands

Boeing offers

Why Seattle

Forecast

• demand of higher wages
• freezing the Machinists' pensions
• moving workers to a defined-contribution savings plan

• income and retirement security
• Job security benefit with long term pension
• No lay off of workers

• $5000 addition to bonus
• improved dental coverage
• retention of a seniority system
• traditional operating base
• corporate incentive package OF $8.7 billion till 2040
• tax breaks and option for new contract
• Experienced aerospace workers
• More aerospace jobs
• No strikes till 2024
• 8 year contract extension
• Confirmed commitment from Dubai and Hong Kong Cathay Pacific

Challenges
Increased cost of product leading to low competitiveness Other Unions in different countries can demand the same
Relocation cost and time
Logistics implications
HR training

Contract vs. laws of the State

SWOT Analysis
Strengths

Weakness

• Strong global network
• Broad product line with new products from its R&D

• Delay in commercial air craft manufacturing • Depends on US government subsidies Opportunities

Threats

• New models of commercial air planes • Increased demand from Asian countries • Uncertain aviation industry
• Competition from Airbus

Alternatives
To sign the contract and operate from
Seattle
Not to
Show More

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