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Boing

In: Business and Management

Submitted By zilizili
Words 881
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In late 2003, the company of Boeing was the worst of its life. However, it was changed some market demand and solved the technology issues, then slowing to improve. According to the case study (Boeing), the six-box organisational model provides a framework that succinctly identifies the key factors at the centre of the Boeing situation. It explains the following according to Palmer et al. (2009): 1. Strategy – was to update their technology systems, downsize their operations, and re-establish relationships with their suppliers and the only feasible way costs could be cut. 2. Structure – the problem of 1994 airbus which shocked the management executives and began a series of changes that were implemented to overcome the bureaucratic structure, outdated technological systems, and unnecessary processes in a company that had reportedly changed. 3. Systems – Boeing adopted the principles of lean manufacturing and aimed to rejuvenate their reputation by making their production more efficient. The object of the project was to implement an automated system of assembly lines. 4. Style – the decision was made to diversify from the traditional commercial airline industry and the many acquisitions that were made created integration issues for the company. The aim again was to add more stability to the business by diversifying into information services and the space industry that providing services with elevated margins that would reflect on Boeing’s bottom line. 5. Staff – according to the CEO of Airbus Noel Forgeard, the process of diversification was ‘extremely demoralizing for Boeing employees,’ but Boeing’s vice president of marketing, Randy Baseler, claimed that ‘what affects morale right now is that we are in a down cycle.’ Regardless of the reasoning behind it, Boeing’s employee morale was at a low and this issue needed to be addressed.
Skills – Boeing has bet its future on the market developing a partiality for smaller aircraft, like their new 7E7. Airbus. On the other hand, the projects will the airlines to purchase larger aircrafts in the future.

Diagnostic models could be used to identify and adjust the functioning of organisations. These models focus on one or more perspectives of determinants organisational performance. Palmer, Dunford & Akin indicate that the diagnostic models could make the complexity of a situation more manageable; identify organisation’s activities or properties that had occurred problems; bind each organisational properties together; provide organisation cultural which defines the organisational characteristics; and provide action guide in the change situation (2008, pp.122-123). In Boeing’s case, a diagnostic tool has been chose to examine the changes that happened in Boeing. The selected model is The Star Model. Jay Galbraith had stated out the five major components for the organisation designing. In the Star Model, the five major components include strategy, structure, processes & lateral capability, reward systems and people practices. Strategy is the main theme of an organisation. It gives out the vision and direction for organisation’s development, which could define the competitive advantages for organisations. Organisation structure defines the interrelations between each within the organisation chart. It identifies power and authority, reporting relationships and organisational roles (2008, 126). Processes and lateral capability defines processes of the organisation. The networks, processes, teams, integrative roles, and matrix structures are the aspects that processes and lateral capability would cover. Reward systems refer to every actions need to align the overall organisation’s objectives. The last components, people practices would refer to human resource practices, performance and behaviour management. In the case, problems that had happened in Boeing had critical impacts to the organisation. 6. Failed management: inappropriate behaviour, loss of documents by Boeing officials 7. Bureaucratic structure 8. Outdated technological systems, information technology decentralized 9. Unnecessary processes that barely changed for a very long period of time 10. Lack of communication within the organisation, manufacturing crisis 11. Cultural synthesis with McDonnell Douglas, family-orientated culture VS government officials for defence. 12. Extremely demoralizing for employees According to the Star Model, if organisation’s strategy is missing or unclear, then the confusion might occur and affect the decision making, such as the un-proper merger with McDonnell Douglas. Bureaucratic structure in Boeing that could not align to business strategies also resulted the competitive advantage losing. It is difficult to share information, long decision and innovation cycle times due to lack of collaboration across boundaries in processes and lateral capability. No reward systems which resulted low standards of performance and diffused energy. Boeing employees without enabled and empowered, was extremely demoralizing and low satisfaction which resulted the low performance. Through the Star Model, Boeing could analyse all their problems under these five big categories and solve them much easier. After identifying the problems, Boeing made series of changes according to the problems, such as moved headquarters of their operations to Chicago, employed an outside leader to come in the organisation and take Boeing back to basics, the new 7E7 planes, work closely with unions to reverse the low morale and so on. Now, Boeing has their 7E7 sold out for years into the future and back to the leadership in the industry. Without any diagnostic tools, they would not be able to solve their problems easily and failures might happen.

The star model
Strategy
Wanted to treamline aircraft assemebly
Diversification

Structure
Decentralized: lack of collaboration
Tried to address the issues
New technology platform
Move seatle to Chicago

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