IMPLEMENTATION OF STRATEGIC MANAGEMENT

AT THE BOEING COMPANY

PAPER ASSIGNMENT

Submitted as a Fulfillment of Requirements to get a Business Strategy and

Policy Score

Arranged by :
Mikael Julian Irsa
1501203431

Lecturer :
Leonardus Wasono Wahyu

BUSINESS ADMINISTRATION S-1 STUDY PROGRAM

FACULTY OF COMMUNICATION AND BUSINESS

TELKOM UNIVERSITY

BANDUNG

2022
 TABLE OF CONTENTS

TABLE OF CONTENTS

CHAPTER I - PRELIMINARY

1.1. BACKGROUND

1.2. PROBLEM FORMULATIONS

1.3. RESEARCH OBJECTIVES

1.4. RESEARCH PURPOSES

1.4.1. THEORETICAL PURPOSES

1.4.2. PRACTICAL PURPOSES

CHAPTER II - LITERATURE REVIEW

2.1. THEORETICAL REVIEW

2.1.1. AVIATION

2.1.2. AVIATION HISTORY

2.1.3. THE BOEING COMPANY

CHAPTER III - DISCUSSION

3.1. BRIEF OF THE BOEING COMPANY

3.2. FORMULATING STRATEGY, IMPLEMENTATION, AND EVALUATION

OF THE BOEING COMPANY

3.3. EXTERNAL ANALYSIS

3.4. INTERNAL ANALYSIS

3.5. SWOT ANALYSIS

3.6. COMPETITIVE GENERIC OF THE BOEING COMPANY

CHAPTER IV - CONCLUSION

4.1. SUMMARY

REFERENCES
 CHAPTER I
PRELIMINARY

1.1. BACKGROUND
The aviation industry is one of the industries engaged in the service sector. The
aviation industry is developing very rapidly, this is evidenced by the increasing
number of passengers and airlines since the regulation of the aviation industry. It
can be said, the development of competition in the aviation industry is currently
experiencing very rapid development. Of course, with the development of the
aviation industry, many aircraft are needed which are the most important part of
this industry. The Boeing Company, better known as Boeing is an American
multinational corporation that designs, manufactures, and sells aircraft,
rotorcraft, rockets, and satellites. This of course makes Boeing the world's
leading aircraft manufacturer. This is further reinforced by the opinion of many
aviation observers who say, "When Boeing releases its newest plane, the world
will buy it." This is also further reinforced by the term, "Otherwise my Boeing
will not leave." As the world's leading aircraft manufacturer, Boeing always
conducts research and development in order to improve safety quality and adapt
to the latest market interests. This is inseparable from the company's risk
analysis, which analyzes the company and Boeing products. This risk analysis is
carried out in order to maintain Boeing's quality value so that it can attract
consumer interest in this case airlines and in order to remain competitive with
other aircraft manufacturing companies such as Bombardier, McDonnell
Douglas, and Airbus. , especially now that Boeing is and has one of the toughest
competitors and one of its toughest competitors, namely Airbus.
1.2. PROBLEM FORMULATIONS
The problem formulation is a research formulation that aims to ask for a causal
relationship (Sugiyono, 2017:36). Based on the background described
previously, Boeing is an aircraft manufacturing company that always conducts
research and development as well as conducts risk analysis to ensure safety
quality and adapt to the latest developments. Therefore, research is needed that
aims to explain and prove the effect of risk analysis on Boeing on Boeing itself,
on consumers, and on business competition between Boeing and Airbus.
Based on the explanation above, the following questions can be formulated:
1. How does a Boeing Company’s Brief Profile?;
2. How does The Boeing Company process in formulating strategy,
implementation, and evaluation?;
3. How is the external analysis and what is the opportunity and threat of macro
and micro analysis of The Boeing Company?;
4. How is the Internal analysis and what are the strengths and weaknesses of
Boeing Company?;
5. How is SWOT analysis of The Boeing Company?; and
6. What is the competitive Generic strategy of The Boeing Company?
1.3. RESEARCH OBJECTIVES
The purpose of the research is part of the written work that aims to obtain
knowledge and answers from the formulation of the problem that has been
formulated. In addition, the purpose of the research can be seen as proof of the
research. Based on the research formulation above, the research objectives are
formulated as follows:
1. To know about The Boeing Company’s Brief Profile;
2. To know about the process in formulating strategy, implementation, and
evaluation of The Boeing Company;
3. To know about the external analysis and what is the opportunity and threat
of macro and micro analysis of The Boeing Company;
4. To know about the Internal analysis and what are the strengths and
weaknesses of Boeing Company;
5. To know about the SWOT analysis of The Boeing Company; and
6. To know about the competitive Generic strategy of The Boeing Company.

1.4. RESEARCH PURPOSES

The benefits of research are part of a written work that aims to explain and
provide results of systematic and objective data collection, processing, and
analysis. Based on this research, the research benefits can be concluded as
follows:
1.4.1. THEORETICAL PURPOSES
This study aims to add insight for readers about the company profile and
corporate strategy of Boeing.
1.4.2. PRACTICAL PURPOSES
This research can be used as input for Boeing in conducting strategic
analysis of its products and companies.
 CHAPTER II
LITERATURE REVIEW

2.1. THEORETICAL REVIEW

2.1.1. AVIATION
The global aviation industry or aviation industry is an integral part of the global
economy that has an important role in development in various sectors. These
sectors include transportation, manufacturing, technology and other sectors. The
aviation industry also has close ties to global economic conditions. In the
Aviation Law (Law No. 1 of 2009 concerning Aviation) it is stated that, aviation
is a mode of transportation that cannot be separated from other modes of
transportation arranged in a dynamic national transportation system and is able
to adapt to future progress, has the characteristics of being able to To achieve
goals in a fast time, with high technology and requiring a high level of safety, its
potential needs to be further developed and its role increased as a regional
liaison both nationally and internationally, as a supporter, driver, and driver of
national development for the sake of improving people's welfare (2019: 58).
Meanwhile, according to Law no. 1 of 2009 is any activity using aircraft to
transport passengers, cargo, and/or post for one or more trips from one airport to
another or several airports (2019: 58).
The aviation industry is one of the industries engaged in the service sector. The
Indonesian aviation industry has experienced very rapid development, this is
evidenced by the soaring number of passengers and airlines since the regulation
of the aviation industry (2021 : 213). The growth of the aviation industry is
marked by the establishment of many domestic private airlines such as LionAir,
Batavia Air, Sriwijaya Air, Wings Air, and several other airlines. In addition, the
growth of the aviation industry is also evidenced by the growth in the number of
domestic passengers which increases quite high every year with an average
growth per year reaching 22% (Kompas, April 13, 2010) (2021: 214). The
Aviation Industry in Indonesia has achieved significant growth from 2009-2018.
The growth of the aviation industry can be seen from the number of passengers
and cargo as shown in the table below.

Passanger Cargo

Years Arrival Departure Total Unload Load Total

2009 42.5 41.6 84.2 311.4 277.6 600.0

2010 50.5 48.8 99.3 361.2 375.7 736.9

2011 59.0 59.2 118.3 450.2 463.5 913.7

2012 69.4 70.6 140.1 462.7 520.5 983.2

 2013 77.5 73.6 151.1 469.1 525.4 994.5

2014 73.5 71.6 145.5 392.6 542.7 935.3

2015 75.5 72.6 148.2 496.4 598.0 1094.4

2016 85.9 83.3 169.3 445.5 532.1 977.6

2017 95.4 90.0 186.3 557.6 603.1 1160.8

2018 101.2 94.8 196.1 641.7 709.5 1351.3

source : Statistik Transportasi Udara (bps.go.id) (all numbers all in million)

Based on table 2.1. The above shows that there has been a significant increase
in volume, both in terms of commercial flights and cargo flights in Indonesia
(2021 : 214).

2.1.2. AVIATION HISTORY

Between 1900 and 1902, the Wright Brothers, Wilbur and Orville Wright
from Dayton, Ohio, designed and tested numerous glider and kite models.
They built a wind tunnel and then created various devices to measure the
drag and lift on more than two hundred wing designs. Finally, their third
glider was a success as it outdid its predecessors, which heavily
contributed to the aeronautical engineering field.

The Wright brothers also worked together to solve the current issue of
controlled, powered flight. They solved the control problem by creating
wing warping for yaw control, roll control, and a steerable rudder. On
December 17th, 1903, the two brothers successfully built and launched the
first crewed heavier-than-air flight. This is also the universally recognized
date that launched modern aviation. On that day, they made a total of four
flights in their simple aircraft, with the longest one piloted by Wilbur,
covering 852 feet in 49 seconds.

In 1906, Alberto Santos-Dumont set the world record by flying his aircraft,
“14-bis,” 220 meters (about twice the length of a football field) in 21.5
seconds over Paris. He also advanced the design by incorporating
moveable parts to the wings to gain lateral stability. Later, in 1908, he
started working with Clement-Bayard company to build the first
mass-produced aircraft, the Demoiselle No. 19.

Aircraft became militarized as soon as it was invented. Italy was the first
country to employ aircraft for military operations. They used airships and
monoplanes to bomb, shell, and transportation during the Turkish-Italian
War in Libya.
In 1914, Roland Garros attached a machine gun to his aircraft, making him
the first “ace.” And the following year, Kurt Wintgens secured his first
aerial victory using a fighter plane designed with a machine gun.
Aircraft were first used in active combat on a large scale in World War I.
This played a decisive role in the First World War. France became the
leading aircraft manufacturer during the war, producing over 68,000
airplanes between 1914 and 1918. During World War II, nearly all nations
increased their production and development of aircraft and flight-based
systems. The military used fighter bombers, strategic bombers, dive
bombers, and ground-attack aircraft.
The invention of radar technology led to more precise, coordinated, and
controlled deployment. In 1942, Arado Ar 234, the first jet-powered
bomber, was launched. The Second World War also led to the rapid
development of helicopters. By the end of the Second World War, there
were airports or landing strips in many cities and towns. During this
period, civil aviation experienced tremendous growth because military
aircraft were repurposed as personal or airliner planes.
Revolutionary aircraft designs, for instance, the Douglas DC-3, a reliable
all-metal passenger airplane with rubberized seats to reduce vibrations and
noise-deadening plastic insulation, helped make flying more comfortable
and accessible for new travelers. To standardize the safety, consistency,
and efficiency of civil flights, the Convention on International Civil
Aviation was established in 1944. Standardization of civil flights led to
safer, more affordable airliners run by major carriers.

Digital adoption and technology techniques in the modern era have seen a
massive advancement in the aviation industry. The release of
computer-aided design and computer-aided manufacturing software in the
1970s facilitated the development of enhanced aircraft designs. Newer
technologies like computer simulations have aided in producing lighter yet
more robust materials for building airplanes.

airplane on runway at dawn

Modern aircraft also come equipped with digital systems, eliminating most
analog and mechanical instruments. During the 1980s, cathode-ray
displays in the cockpit were replaced with more advanced computer-based
electronic displays. A notable example was the Boeing 767’s glass cockpit
in 1981. Modern displays, when integrated into automatic pilots, make
cockpit resource management a crucial aspect of flight safety.

Also, the introduction of composite materials like the one used for building
Boeing 787 Dreamliner has significantly cut down the weight of aircraft,
 leading to improved fuel efficiency. Advanced composite has also led to
the development of sweeping wing tips that reduce component weight and
improves aerodynamics of an aircraft. (source :
https://www.spartan.edu/news/history-of-aviation/)

2.1.3. THE BOEING COMPANY

The Boeing Company or better known as Boeing is a multinational
company from the United States that is engaged in the aviation industry
such as designing, producing, and selling airplanes, rotorcraft, rockets,
and satellites. The company also provides rental services and product
support. Boeing is one of the world's largest aircraft manufacturers; also
the second largest defense contractor in the world by 2015 revenue (2021
: https://people.defensenews.com/), and the largest exporter in the United
States by dollar value (2009 : https://usatoday30.usatoday.com/ ).
 CHAPTER III
DISCUSSION

3.1. BRIEF OF THE BOEING COMPANY

3.1.1. BOEING COMPANY
The Boeing Company or better known as Boeing is a multinational
company from the United States that is engaged in the aviation industry
such as designing, producing, and selling airplanes, rotorcraft, rockets, and
satellites. The company also provides rental services and product support.
Boeing is one of the world's largest aircraft manufacturers; also the second
largest defense contractor in the world by 2015 revenue, and the largest
exporter in the United States by dollar value.
3.1.2. THE HISTORY OF THE BOEING COMPANY
Boeing’s origin dates to 1916 when the American timber merchant
William E. Boeing founded Aero Products Company shortly after he and
U.S. Navy officer Conrad Westervelt developed a single-engine, two-seat
seaplane, the B&W. Renamed Boeing Airplane Company in 1917, the
enterprise built “flying boats” for the Navy during World War I, and in the
1920s and ’30s it successfully sold its trainers, pursuit planes, observation
craft, torpedo planes, and patrol bombers to the U.S. military. In the late
1920s Boeing Airplane expanded into airmail services, and in 1928
William Boeing formed Boeing Airplane & Transport Corporation to
encompass both manufacturing and airline operations. The next year the
company was renamed United Aircraft and Transport Corporation and
acquired several aircraft makers, among them Chance Vought, Avion
(which became Northrop Aircraft), Stearman Aircraft, Sikorsky Aviation,
engine manufacturer Pratt & Whitney, and aircraft and propeller maker
Hamilton Metalplane. In 1931 it combined four smaller airlines under its
ownership into United Airlines. In 1934, under new U.S. antitrust
legislation (the Air Mail Act of 1934), aircraft manufacture was required to
be divorced from air transport, and a newly incorporated Boeing Airplane
Company became one of the three companies to emerge from the
dissolution of United Aircraft and Transport. The other two were United
Aircraft Corporation (now United Technologies Corporation) and United
Airlines.
Prior to and during World War II, Boeing Airplane Company built several
famous commercial aircraft, such as the Model 247 twin-engine
monoplane, the Model 314 flying boat (one of Pan American’s
Clipper-class aircraft), and the Model 307 Stratoliner, the first airliner with
a pressurized cabin. Boeing’s legendary bombers, the B-17 Flying Fortress
(first flown in 1935) and the B-29 Superfortress (1942), played key roles
in the Allied war effort in World War II. In the postwar years Boeing
continued its military commitments with the six-engine B-47 Stratojet
(1947) and eight-engine B-52 Stratofortress (1952) jet bombers.
While Boeing was successfully selling military aircraft, its commercial
products lagged behind those of rivals Douglas and Lockheed. To compete
in the fierce and expanding world market after World War II, the company
decided to develop an airliner, powered by turbojets, with enough range to
cross the North Atlantic. After initial hesitation from airlines (most of
which had committed to popular and less-expensive propeller-driven
airliners from rival firms), but buttressed by sales to the U.S. Air Force in
the form of an aerial tanker (the KC-135 Stratotanker), the four-engine
plane, designated the 707, went into commercial service in 1958 on a Pan
American transatlantic route. The aircraft quickly won over passengers
with its shorter flight time and smoother ride and subsequently helped to
revolutionize air travel. The 707 was followed by the 727 trijet and 737
twinjet, which entered service in 1964 and 1968, respectively. The 737 was
developed into a modern family of planes, and by the end of the 20th
century it had become the world’s best-selling commercial aircraft. The
high development costs of the 747 “Jumbo Jet,” the world’s first
wide-body jetliner, almost forced Boeing into bankruptcy, but, when the
400-seat aircraft went into service in 1970, it allowed airlines to offer
affordable long-range air travel for the general public and gave Boeing a
monopoly position in this market segment.
In 1960 Boeing purchased Vertol Corporation, then the world’s largest
independent manufacturer of helicopters. As Boeing Helicopters, the unit
focused on tandem-rotor helicopters and was responsible for the
development of the CH-47 Chinook and CH-46 Sea Knight military
transport helicopters (first flown in 1961 and 1962, respectively). Boeing’s
work on missiles, which began in 1945, resulted in such weapons as the
silo-launched Minuteman intercontinental ballistic missile (deployed in
1962) and the AGM-86B/C air-launched cruise missile (deployed in 1982).
In the space sector during the 1960s and ’70s, Boeing built the Lunar
Orbiters, NASA’s first spacecraft to orbit the Moon (1966–67), and the
Mariner 10 space probe, which took the first close-up pictures of the
surface of Mercury (1974–75). It also designed and built the first stage of
the Saturn V rockets that sent Apollo astronauts to the Moon and the
battery-powered Lunar Roving Vehicles used in the Apollo 15, 16, and 17
missions. In 1976 it entered the upper-stage-rocket arena when it was
selected to develop the Inertial Upper Stage (IUS), a two-stage payload
delivery vehicle that can be taken into space by either a space shuttle or a
launcher such as the Titan. In 1993 NASA selected Boeing as the prime
contractor for the ISS, and two years later the company became
responsible for the integration and verification of ISS systems and the
design, analysis, manufacture, verification, and delivery of the American
components of the station. In 2014 NASA awarded a commercial
spaceflight contract to Boeing to finish the development of its CST-100
spacecraft to carry crews to the ISS. Since the discontinuation of its space
shuttle program in 2011, NASA has relied on Russian transports to take
astronauts to the ISS.
In 1991 the U.S. Air Force chose a design offered by a consortium
comprising Lockheed (later Lockheed Martin), Boeing, and General
Dynamics for a twin-engine advanced tactical fighter with stealth features;
the aircraft was named the F-22 Raptor and was first flown in 1997. In
1996 Boeing and Lockheed Martin received U.S. defense contracts to
build competitive technology demonstrators for the Joint Strike Fighter,
intended as an affordable, next-generation, multirole fighter for the armed
services of the United States and Britain. In 1995 Boeing joined Ukrainian,
Russian, and Anglo-Norwegian partners to form Sea Launch, a
commercial launch services company that sent satellites into geostationary
orbit from a floating platform at an equatorial site in the Pacific Ocean.
Commercial launches began in 1999. In 2000 Boeing acquired the satellite
business of Hughes Electronics.

In 2003 Boeing began taking orders for the 787 Dreamliner, a mid-range
jet with speeds (Mach 0.85) that would match the fastest wide-body
long-range planes but with vastly improved fuel efficiency, thanks to new
high-bypass turbofan engines built by Pratt & Whitney and Rolls-Royce
and a radically innovative body design. Roughly half of the primary
structure of the 787, including the fuselage section and the wings, was
made of carbon-fiber and plastic composite materials, lighter than the
aluminum alloys used in most aircraft. Many airlines, faced with rising
fuel costs, saw the 787 as key to upgrading their fleets in the following
decade and ordered hundreds of the new planes. Originally scheduled to be
delivered for commercial service starting in 2008, the 787 was beset with
several production problems, not the least of which was failure of the
crucial fuselage section in stress tests. Consequently, Boeing did not make
initial delivery until 2011. In January 2013, following an airworthiness
directive issued by the U.S. Federal Aviation Administration (FAA) that
was subsequently taken up by regulators worldwide, all 787s in operation
globally were temporarily grounded until a potential risk for battery fire
was corrected.
3.1.3. PRODUCTS AND SERVICES OF THE BOEING COMPANY

Based on its official website, Boeing sells several products and services
which are shown in the following table:

Table 2. 2 Boeing Products and Services Sold

BOEING PRODUCT AND SERVICES

No PRODUCTS SERVICES

1 Next-Generation 737 Engineering, Modification,

and Maintenance

2 737 MAX Supply Chain

3 747-8 Training Solutions

4 767 Digital Solution and Analytics

5 777 24/7 Customer Support

6 777X -

7 787 -

8 Freighters -

9 Boeing Support and -

Services

10 Boeing Business Jet -

source : https://www.boeing.com/commercial/

3.1.4. VISION AND MISSION OF THE BOEING COMPANY

- VISION
Boeing’s vision statement is “designed to inspire and focus all
employees on a shared future and to reaffirm that, together, we
can meet the challenges that lie ahead.” The central focus of this
vision statement is the role that Boeing as an entity plays in
influencing its workforce. It identifies its leadership and inspirational
potential to lead them towards a conquering future.
(https://mission-statement.com/boeing/ )
- MISSION
Boeing’s mission statement is “To connect, protect, explore, and
inspire the world through aerospace innovation.”
(https://bstrategyhub.com/boeing-mission-statement-values )
 3.1.5. VALUE PROPOSITION OF THE BOEING COMPANY
Given the increasingly competitive nature of the commercial aircraft
business, Boeing is focusing on increasing its existing strengths in
product R&D and manufacturing while at the same time reducing the
costs of these efforts. With the average aircraft development process
taking nearly 25 years to complete, Boeing needed a process that was
better in terms of both cost and speed. In response, companies are
investing in interactive CAD systems that not only address these issues,
but also provide companies with a number of additional benefits
including greater flexibility and technological capability.

3.2. FORMULATING STRATEGY, IMPLEMENTATION AND EVALUATION

PROCESS OF THE BOEING COMPANY
3.2.1. STRATEGY
At present, the strategic intent of Boeing goes beyond improving the
quality of the end product. Apart from working on the means of
attracting new customers and compelling the staff members to excel in
their performance, the organization will also strive to introduce the
concept of consistent and unceasing change and improvement as the
foundation for its operations. In other words, a redesign of the corporate
values system should be viewed as the primary strategic intent that will
have to be implemented.
The strategy will be implemented by focusing on changing the
organization’s values and mission, making it more people-oriented. As
soon as the needs of all stakeholders are taken into account, it will be
easier to shape the approaches required to motivate the staff members
and, therefore, improve the current quality levels. Furthermore, the
introduction of principles such as Corporate Social Responsibility, the
Total Quality Management model, and the DMAIC framework, will have
to be considered.
(https://ivypanda.com/essays/boeing-companys-functional-strategy-and-c
ontrol/ )
3.2.2. IMPLEMENTATION
Strategic intent is a key concept of strategic development because it helps
formulate the goals in a brief and intelligible way. Strategies are quite
predictably complicated things, as they involve various elements to
address the complex systems of the existing operation and adjust them to
the declared goals. However, an intent that is simply put, such as “to
outperform company X” or “to earn 100,000,000 USD next year” can be
beneficial because it enables matching strategic actions to a clear
purpose. Therefore, for each action, it can be assessed whether it
contributes to achieving the goal or not. Strategic intent should
encompass so-called “stretch targets,” i.e. challenging goals that lie
beyond the current reach of a company. If designed correctly, coordinated
 with strategic actions, and supported by the commitment of the
management, stretch targets pull businesses toward new opportunities
and new areas of the market. The Boeing Company has announced two
stretch targets: to double profitability within four years and to beat Elon
Musk to Mars. Both targets require an extensive effort, primarily in the
functional area of production, and technological modifications that will
help the company advance. The Boeing Company demonstrates that
broadly defining the industry you are in is what moves businesses
forward. Instead of positioning itself as an airplane manufacturer, the
company acknowledges that it is one of the best in the world in terms of
producing, operating, supporting, and distributing highly complex
aircraft. This strategic definition allows going to new markets, such as
the emerging market of private spaceflight.
3.2.3. EVALUATION
Kaplan and Norton’s classical concept of the balanced scorecard suggests
adding to the financial perspective three more perspectives of
performance evaluation: customer, internal operation, and learning and
growth. From the financial perspective, the Boeing Company has the
objective to have more international contracts, which will enhance the
international presence and network of cooperation and reduce the
dependence on current customers. From the customer perspective, there
is the objective to reach new audiences, which requires an effort from the
company’s marketers and will help discover new demand to move the
business forward. From the internal operation perspective, one of the
objectives is to increase environmental initiatives, which will involve
research and technological modifications based on recommendations on
reducing environmental impact and adopting more sustainable practices.
From the learning and growth perspective, the Boeing Company has set
the ambitious objective of technological leadership, which can be
achieved through encouraging diversity, feedback, and ideas aimed at
bringing innovation and committing to constant development by pursuing
stretch targets.
It is important that the scorecard not only helps evaluate the performance
but also facilitates the strategic development of corporations because it
promotes adjusting everything the corporations do to their strategic goals.
For the Boeing Company, the corporate balanced scorecard will feature
the following elements:
● Finances
​The number of international contracts
​Environmental costs (including fines)
​Employment efficiency
● Customer Perspective
​Reaching new audiences
 I​ ncreasing market share
I​ ncreasing customer loyalty and satisfaction
● Internal Operation
​Environmental initiatives
​Core competency promotion
​Corporate citizenship awareness
● Learning and Growth
​Technological leadership
​Encouraging diversity and creativeness
​Leadership programs

3.3. EXTERNAL ANALYSIS AND THE OPPORTUNITY AND THREAT OF

MACRO AND MICRO ANALYSIS OF THE BOEING COMPANY
3.3.1. Political Factor
Since Boeing operates in more than 65 countries, exposing itself to
different political environments and systems, it should keep a close eye
on the political factors that could impact the smoothness of its operation
overseas. Political stability is an essential element in the quest for
business success. It provides a stable and friendly environment, which
will help businesses conduct their operations smoothly and efficiently.
Political chaos and abrupt changes in aviation policies can damage
Boeing immensely.
For example, the European Union has banned several airlines from
operating in the EU. Due to such disruptions, Boeing may face a fall in
demand for its aircraft, which will lead to a drop in its revenues.
Moreover, due to the recent Russia-Ukraine conflict, Boeing stopped
buying Titanium from Russia. Boeing relied 35% on Russian Titanium,
this self-imposed ban could lead to disruption in its supply chain and
could harm the operations of Boeing.
Another political factor that plays a vital role in smooth business
operations is transparency and good governance.
Corruption and bad governance negatively influence the business
environment. Companies that operate in countries with high corruption
and weak law enforcement face additional challenges for their business.
Operations of Boeing can get affected due to corrupt business practices.
Moreover, fake lawsuits and controversies can damage the reputation of
Boeing internationally.

3.3.2. Economic Factor

This section of the PESTLE analysis highlights some of the economic
factors that significantly impact businesses.
Like any other organization, economic factors have a significant impact
on Boeing. For example, if the foreign exchange rate is down, it will
 impact its operations and, consequently, its profitability. Similarly, any
rise in interest rates can adversely affect airlines that rely heavily on
debt financing.
The economic condition has a significant impact on an organization's
operations. Emerging economies provide an excellent opportunity for
Boeing to tap the undiscovered markets.
The expansion of Boeing's operations will help the Aerospace company
to generate significant revenues and increase its clients.
As a global manufacturing and service provider, Boeing relies on
macroeconomic factors to determine its growth strategies.
GDP growth rate and exchange rate can influence Boeing's long-term
growth strategies, whereas the interest rate can either help or hinder
Boeing's future profitability.
Countries with high GDP growth rates indicate that people consume
more in the economy. Therefore, increased consumption can be really
beneficial for Boeing since this can increase the demand for its
products. As a result, Boeing's revenue will increase.
Another critical economic factor that has affected every business is high
global inflation. A high rate of inflation is being observed all across the
globe after economies are trying to make up for the losses they incurred
during COVID-19.
This global inflation has increased the cost of operations of businesses.
Looking at how inflation is increasing day by day, Boeing may increase
the price of its products and services to fight off the increase in the price
of its inputs.

3.3.3. Social Factor

Social factors are important determinants of human behavior, and they
represent the norms, values, and customs of a society.
To run a business successfully in any country, companies need to know
the socio-cultural factors that can impact their operations.
An important social factor that is under discussion nowadays is gender
roles. Gender roles vary from society to society. Before entering a
market, Boeing should analyze what sort of roles are assigned to what
gender to make HR and marketing strategies accordingly.
Moreover, different societies have different practices and norms. For
example, China has the highest percentage of salaries spent online. In
such countries, opening a physical store might not be that effective.
Boeing should think of making its online store available to countries
that shop online mostly.
Furthermore, each society has different power distance and equality
levels within organizations. Therefore, before starting its operations in
any society, Boeing should really look at these factors to make
organizational policies accordingly.
 Besides the factors discussed earlier, the demography of societies varies
so much. Due to these demographic changes, consumer behavior also
differs from one country to another.
Studying consumer behavior to predict the response of the customers is
very important. Boeing should analyze this behavior before entering the
market to see whether its products and services will be consumed in a
particular society.

3.3.4. Technological Factor

Technological factors are considered the fourth segment of the PESTLE
analysis. As a new wave of technology is being witnessed around the
globe, the influence of technological factors on businesses has increased.

Boeing should pay attention to the new technological developments in

order to gain a competitive edge over its competitors.

Lately, information and communication technologies have led to

innovation in marketing techniques to enhance collaboration with
customers. Social media has become a standard tool for modern business
environments.

Boeing can avail of this opportunity to use social media for its marketing
campaign to get feedback from its customers. This is a very effective
marketing strategy and helps increase Boeing's revenue.

Moreover, Boeing should pay close attention to technological

innovations in the future. You guys must have heard people saying,
There's a bright future ahead. Trust me, guys, keeping 5G in mind, they
were right.

The 5G technology is the most important innovation in the wireless

industry. It can improve the user experience, increase data speed, and
deliver broader access to Boeing's products and services. If Boeing
makes the most of this 5G technology, no one will be able to compete
with it.

Where technology provides so many opportunities to Boeing, it has

damaged Boeing's operations to some extent.

Development of new products takes time. However, the development

cycle has shortened to such an extent that companies can no longer afford
to take their time. This trend puts pressure on Boeing to increase the
number of new products.
3.3.5. Legal Factor
Legal factors are considered among the top factors that could impact a
company. When a country operates in several countries, it has to be very
careful since the laws of every country vary.
To stay out of trouble, Boeing needs to abide by the laws of the countries
where it operates.
In recent times, employee protection laws are considered very sensitive.
However, Boeing must follow employee health and safety laws to stay
out of trouble as a large organization.
Some countries, like Australia, have strict regulations to ensure labor
safety. Boeing must provide a secure working environment for the
workforce, which is Boeings ethical and moral obligation.
Similarly, anti-discrimination laws like equal employment opportunity
also need to be carefully studied when developing human resource
practices as discriminatory suits against employers harm the
organizational image.
Another law that is considered very sensitive is the data protection law.
Boeing needs to protect customer data from attacks and violations by
hackers, or else heavy fines or even bans can be imposed, similar to
Facebook.
Boeing must study data protection regulations to ensure customer privacy
and security. Moreover, there are laws to set the maximum price,
guarantee a certain quality standard, and protect consumers from
fraudulent marketing claims. Therefore, Boeing must consider these
factors to ensure compliance with consumer protection laws.

3.3.6. Environment Factor

Environmental laws and standards vary from country to country.
However, since Boeing operates in many countries, it should know what
environmental factors will impact its business.
Airlines emit 11% of the total greenhouse gasses. Boeing should take
notice to find ways to mitigate the emission of greenhouse gasses. This
will help the entire world fight the war against global warming. It'll also
create a positive image of the company.
Boeing also has an opportunity to apply green innovation to its products
and services. As Boeing continues to innovate, it must consider all
applicable environmental regulations. Stakeholders are beginning to
place a greater emphasis on developing eco-friendly products
There is a growing trend towards the use of green/eco-friendly products.
The environmental management provisions demand that Boeing integrate
sustainable development practices into their manufacturing processes,
product design, and delivery of services processes to comply with
government mandates.
3.4. INTERNAL ANALYSIS AND THE STRENGTHS AND WEAKNESSES
OF THE BOEING COMPANY
3.4.1. ADVANTAGES OF CONDUCTING VALUE CHAINS OF THE
BOEING COMPANY
By conducting the Value Chain Analysis of Boeing Co during the
planning process, possible sources of competitive advantage can be
identified. The firm/company is a collection of different activities that
share relatedness to some extent. Boeing Co cannot trade all activities
in the external market. The Value Chain approach suggests that a
company can consider these activities as economic rent sources. These
activities can also act as barriers to new entrants or cause cost
disadvantages to competitors.
Boeing Co can identify various internal and external linkages among
activities through the value chain lens. The internal linkages are-
interrelationships between activities within same organizational units
and external linkages are between business units of same or different
firms. Studying these interrelationships can help a company take benefit
from coordination and joint optimisation.
The use of Value Chain Analysis can optimize the finances, products
and information flow.
● The improved information flow can help the company
identify and exploit new opportunities and reduce external
threats. The continuous Value Chain evaluation can result in
timely filing important gaps that may affect a firm's productivity.
● The effective implementation of the Value Chain
Analysis of Boeing Co can improve the material and product
flow due to improved demand and sales forecasting. The
inventory management also improves as Boeing Co can
minimize the delays by tracking activities throughout the supply
chain.
● Modern customers place high importance on quick
response and convenient access to important product related
information. The unexpected interruption in the information
flow can affect the customer-supplier relationship. Boeing Co
Value Chain Analysis and its implementation can highlight and
remove the bottlenecks to the information flow.
Boeing Co Value Chain Analysis can be used in the competitive
strategic decision-making process. However, choosing the right
competitive strategy (cost leadership, differentiation or focus) requires
knowledge of your own and rivals’ cost structure.
 3.4.2. CHALLENGES ASSOCIATED WITH VALUE CHAINS
ANALYSIS OF THE BOEING COMPANY
● The company may lose its vision and overall strategy by dividing
operations into different activities.
● Dividing the operations into primary and support activities may not be
separable due to increased complexity.
● The division process can be time consuming and finding the required
information can also be difficult.
● Effective value chain implementation does not only require familiarity
but detailed expertise.
● Boeing Co may find it difficult to get required information if its
Business Information System is not structured accordingly.

3.5. SWOT ANALYSIS OF THE BOEING COMPANY

3.5.1. STRENGTHS
For Boeing, the very first step is to expand their market into high
purchasing capability areas. Market penetration seems important for the
majority of companies. Then, only innovation could make greater
progress in this industry:
● Since the company has the second-largest aerospace
company for aerospace globally, its market share is substantial.
Being the most significant aircraft manufacturing company in
security, space, and defense, it has a contract of nearly billions of
dollars. It influences the economy of the company;
● The company manufactures its products with fine
innovative skills. They keep themselves upgraded with the
technological utilization in their products;
● They serve a wide variety of products based on their needs,
like commercial airplanes, corporate and personal jets;
● The company has a strong relationship with the
international and local suppliers of their company;
● The company has an excellent and honorable bond with its
partners, which has led them to the peak of success. It has a robust
supply chain as it outsources 70% of its manufacturing. Thus,
ensuring on-time delivery.

3.5.2. WEAKNESSES
Besides its strengths, it is also crucial for a company to know its
weakness. Once they identify the reasons affecting their growth, they can
take the necessary steps to negate their impact:
● The company's most unsafe design is 737 Max, which has
crashed two times in the Java sea in 2019. The design is unsafe and
has lots of defaults. It works as a significant weakness of this
company;
 ● The company highly relies on the manufacturers' heavy
outsourcing;
● The company has a massive dependency on contracts from
the USA government. Around 27% of the company's revenue
depends on the US government. Thus the political undulations
affect the company a lot.
3.5.3. OPPORTUNITIES
The company's performance assessment shows how they can use the
available opportunities in their favor. The company can concentrate on
the ones that align with their strengths. As a top-rated brand, Boeing has
several strengths which allow them to use many of the opportunities to
ensure their growth:
● The company has become the prime contractor of the USA
government. Thus they got an offer of launching the US Space
Force, which works as a massive opportunity for the company;
● To supply the aircraft with well-established technologies,
the company has to explore its new and innovative skills. It works
as an effective means to get hold of the market share;
● The technology of satellite demands helps them increase
services very quickly. It works as a scope to upgrade their position.
The aircraft is eco-friendly and pollution-free as well.
3.5.4. THREATS
With time goes by, more and more technological companies know how to
make aircrafts, and even revolved their technique to make more
eco-friendly airplanes, thus how to keep growth become a difficulty for
Boeing company:
● The default in 737Max becomes fixed to the customer's
mind. Their perception has changed in the company. They have a
fear of crash and lacks safety in their aircraft;
● The 9/11 terrorist attack has a devastating impact on the
public's mind. The decline of air travel has incurred much loss;
● The intense competition between Airbus (EU) and Boeing
(USA) has become bitter and complex. A single loss of customer
may incur a huge loss for the company.
(https://www.edrawmax.com/article/boeing-swot-analysis.html )

3.6. COMPETITIVE GENERIC STUDY OF THE BOEING COMPANY

Boeing Company The Company is a multinational firm with high recognition in
targeted market segments. The intensifying competition in the industry has made
it challenging for Boeing Company The to sustain the market leadership position
and increase market share without exerting significant efforts. The prevailing
business environment is compelling Boeing Company to obtain a critical
advantage over others to stay ahead of the competition. Being a global brand
with a strong presence all over the world, Boeing Company has set its
competitive positioning based on some critical factors that provide a strong edge
over rivals including the Competitor in the majority consumer markets. Boeing
Company’'s competitive advantage strategies can be understood in light of
Michael Porter’s generic and intensive growth model.
The company has adopted a combination of cost leadership, differentiation and
focus strategies to handle the competitive pressure. The customer base expansion
and sales growth objectives are obtained by focusing on most appropriate
intensive growth strategies based on three generic strategy streams (cost,
differentiation and focus). The intensive growth strategies adopted by Boeing
Company The to achieve growth targets include- market penetration, product
development, market development and diversification. In this article, a detailed
discussion of how Boeing Company obtains a competitive advantage by
adopting generic and intensive growth strategies is made.
 CHAPTER IV
CONCLUSION

4.1. SUMMARY
The Boeing Company is an aircraft manufacturing company that is a parameter
for aircraft manufacturers in the world because of its technological prowess and
sales strategy, however, there are still many shortcomings in terms of sales
strategies and others that make the Boeing Company have to improve so as not
to be left behind by its business competitors.
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https://www.edrawmax.com/article/boeing-swot-analysis.html