Boeing Journey to Excellence: Lean

¶ … Boeing Journey to Excellence: Lean Production Transformation in the Internal and External Supply Chains at Boeing (Blake, Eash, 2003) defines the progression of the aerospace manufacturer and services provider, culminating in the strategies the company is using today to attain optimal performance of its supply chains. From a series of acquisitions over the first several decades of its existence, Boeing has faced the challenge of integrating supply chains and ensuring there is a high level of collaboration and shared knowledge. The use of collaborative supply chain techniques is shown in the partnership of Boeing and Alcoa (Micheau, 2005), in addition to the creation of collaborative work teams with various Department of Defense organizations as well. The intent of this paper is to provide an overview of how Boeing is addressing the challenges and opportunities of optimizing their supply chain in the 21st century.

First Priority Is Strategic Sourcing and Supplier Collaboration

The article shows a progression from lean supply chain management through the development of value chain management, System Kaizen, and the creation of supply chain partnerships (Blake, Eash, 2003). During this journey from the development of sourcing and procurement as competitive advantages, Boeing has also embraced the concepts of supplier relationship management, a best practice in the development of more collaborative supply chains (Niezen, Weller, 2006). Boeing has seen the percentage of costs attributable to suppliers increase, with the projection that by 2016, 75% of the costs of their products will be from suppliers (Blake, Eash, 2003). This translates into a much more leaner and efficient series of production workflows to drop the costs of developing, producing, and servicing their products, yet also the coordination and tight collaboration of suppliers. Boeing's supply chain must be adept at managing the constant customization of products to exacting standards of performance and compatibility. There is the need for also managing the materials and design constraints while at the same time accomplishing production delivery schedules at or below cost from a supplier standpoint. The process of becoming and sustaining the role of being a Boeing supplier is rigorous and requires constant vigilance to quality and delivery timeframes (Agajanian, Nicoletti, Broersma, Bailes, 2006).

Redefining Supplier Relationships with Value Stream Mapping

The Boeing culture has progressively adopted the concepts and techniques of Value Stream Mapping to increase the performance of supplier-facing and collaborating processes (Blake, Eash, 2003). Implicit in these approaches to Value Stream Mapping is the continual definition of lean supply chain strategies and the development of collaborative teams that are both project- and process-based. This integration of project and process teams has given Boeing a significant competitive advantage relative to their closest commercial aircraft competitor, Airbus, who has not specifically adopted this same approach. The use of Value Stream Mapping to define the next generation of airlines has given Boeing a competitive advantage in the global market for commercial aircraft (Smock, 2008). As part of the sourcing and strategic procurement process on the Dreamliner, the company has created teams that are process-centric, looking at how to be more efficient at not only the actual design of the project, but the processes that the designs are based on. In addition, Boeing has worked to bring suppliers into the design, development, and launch phases of a new project.

Future State of Lean Relationships