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Boeing Case Study

In: Business and Management

Submitted By mkrafes
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1. How does e-Enabled create value for Boeing?
In the “Essentials of information systems for managers”, Piccoli does not only define value creation as the genesis of worthwhile things that did not exist before (Pic, 214), but also explains the two major ways with which added value could be created (Pic, 222): either increasing customer willingness to pay by doing something of value for customers, or decreasing supplier opportunity cost by working with the firms’ suppliers on providing the needed resources for less money. The former (CWP) is defined as the maximum amount the customers are ready to spend on the firm’s product or service (Pic, 215), whereas the latter (SOC) is defined as the minimum amount of money the suppliers are willing to accept before providing the needed resources (Pic, 215).
As far as Boeing is concerned, the new e-Enabled strategy focused on increasing the customer willingness to pay, and I quote from the case (LYN, 1): “Boeing unveiled a new strategy that executives believed would help its airline customers improve efficiency and profitability and also differentiate its products in the market place.” If we analyze this quoted statement, we will see that the way Boeing intended its customers to create added value from e-Enabled is twofold:
First, from e-Enabled’s potential to reduce costs complexity, provide real-time situational awareness for both flight crews and airline operations centers, improve operational efficiency, enhance the travel experience for the passenger, and reduce passenger-stranding delays and cancellations. The scheduling software provided by SBS International (one of the four new acquisitions that came along with the creation of CAS (Commercial Aviation Services)) that avoided rule violations is a great example of how e-Enabled helped reduce an airline’s operating costs. Second, Boeing was well aware that its customers…...

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