* Case Study

Presentation (Boeing)

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* worlds leading aerospace company * The largest manufacturer of commercial jetliners and military
aircrafts

* experiences and difficulties

push Boeing being a successful company struggled (1990s - early 2000s) i.e. mergers, growing competitive pressures, production halt, and technology failure

* the diagnosis for change

* essential to overturn Boeings woes * ensure sustainable performance improvement.

* In 2003, the scandal of the Pentagon

- Caused Boeings stock price to fall by 6.5 percent - under the leadership of Phil Condit (head of Boeing) - resigned after seven-year reign

* Manufacturing crisis
1997 - 747 aircraft production halt for 20 days investors accused of them of trickery in regard to a merger with McDonnell Douglas a payout of $92.5 million was made to shareholders

* Financial dilemma

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* 2001 -technology seemed to be a big issue when
channels

implementing an automated system of assembly lines

* Coordination and facilitation of easier communication * Problems arose

- decentralization of information technology was executed
and over 400 systems were being used to meet the needs of various departments.

* Due to a lack of collaboration regarding product

procurement, Boeing could manufacture the same product for one aircraft but subcontracted for another.

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* By Jay Galbraith * a framework that guides the assessment, planning and
implementation of organizational change to ensure sustainable performance improvement.

* 5 elements: * Strategy * Structure * Processes and Lateral Capability * Reward systems * People practices

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* A set of strategic business objectives * a high-level vision for achieving those objectives * a new direction taken in response to environmental
forces

* E.g. 1994 - Boeing began to change when its greatest

competitive capability.

rival, the Airbus had reserved more orders than itself.

* Boeing needed a higher level vision for developing the

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* formal authority relationships and grouping of
activities (on organization chart)

* After implementing a new strategy, changes to

organizational design and lines of reporting that will be provoked

- the distribution of power - i.e. the level of centralization versus decentralization.

* E.g. Boeing implemented a Web-based procurement

system

* to monitor stock levels and replenish supplies (dipped

below a predetermined minimum)

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* the processes, procedures, and workflows guiding the
organizations operations (formal or informal)

* E.g. process of automated production lines = exertion * Boeing adopted a technological platform
- to regulate the product life cycles + cut cost - facilitate the effectiveness of production of the 7E7

*
* Seek to align individual actions to organizational
objectives.

* (Before change) low morale around Boeings staffs was a

major obstacle for improving competitive capability staffs satisfaction.

* Reward system does help organization to increase its

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* the combined human resource practices (e.g. selection,
development, performance management)

* refer to changes to the employees roles, responsibilities

and skill sets of individuals in the organization

* In the Boeing case, when the new system was launched,

then all the staffs were required to acquire the new knowledge and relevant skills, which would improve the efficiency of the company.