Boeing Proves More Issues with the Dreamliner

Business Week this past week posted a story about Boeing’s 787 Dreamliner and the most recent issue that occurred. Whether it has been issues with the batteries catching fire or the most recent fire on the Ethiopian Air 787, it appears to me that poor project management is to blame. We continue to talk about risk management in our class, but if the Boeing project manager for the 787 was doing the job properly, then I would guess that the issue would have been fixed in January when the initial fire occurred. The article stated that Boeing redesigned the lithium ion battery packs, but last week’s fire on the 787 proved that their are possibly still issues with the 787 Dreamliner.

The incident last week caused Heathrow Airport to temporarily close some runways and re-route some flights. The costs for this latest incident will be large, not only due to the re-routing and delays, but to the share price in Boeing stock. It did seem like the response to the issue was very quick, so perhaps the risk management plan was ready for this type of scenario with a backup strategy in place. Officials were sent right away to check out the issue in person and tweets were sent right away to confirm that no one was hurt and calm the public.

On a side note, it was interesting to learn that the Boeing 787 Dreamliner was not built in the traditional manner, but instead completed subassemblies from suppliers were delivered to Boeing. The use of pre-installed systems shaved off time for the final assembly of the airplanes. In an industry where delivery time is huge, this can account for a large cost savings in the final project, especially since this could limit the amount of extra labor needed to complete a project on time. It doesn’t appear that this was a cause of the issues that the Dreamliner has seen, but it can be difficult to manage quality when you are sourcing from an outside company. As a manager you to decide between shorter time period of final project to market versus the extra costs incurred, but you also need to look at the extra risks that can occur as a result of outsourcing or shortening the time of individual activities in the production process.

I wonder what the Boeing risk management process was and if it was amended after the last fire that occurred as a result of the ion batteries used in the plane. Do you think that Boeing could have eliminated the risk of the most recent fire? Do you think that the Boeing project managers have worked through these technical issues with the 787 Dreamliner or do you expect that this will happen again?

9 thoughts on “Boeing Proves More Issues with the Dreamliner

  1. The Dreamliner project from the start has been a PR nightmare for Boeing. While Boeing traditionally has been recognized as the world leader in aviation, things are starting to look bleak considering the amount of time it took to get this plane to the market, and now all the issues they are having with different mechanical issues on the plane. However, I’m not sure that the risk management strategy would have saved them on this project – I think the errors in the management of the project have been obvious at all stages throughout the press coming out on this product.

    Had they had an effective risk management strategy, maybe they could have had a back-up plan for the orders for this plane that were cancelled, but the mistakes on the overall management of the project and delays continue to be a root cause that needs to be fixed for them moving forward or they will continue to disappoint.

  2. I’m sure there are a number of things Boeing would love to do over with regards to the Dreamliner. Relying on components from dozens of vendors spread around the world obviously requires a great deal of coordination and I have to wonder if some of the issues that Boeing’s experiencd could have been identified and fixed before the launch if they had taken a more traditional approach. While I’m sure no one at Boeing would have explicitly stated it, it feels like they emphasized cost control over quality of the finished product in this instance. I’m sure that the reliance on outside suppliers was addressed in their risk management plan but it seems unlikely that they accurately anticipated the cost (or probability) of failure.

  3. Justin, I think you hit the nail right on the head, in that their production method of multiple suppliers caused issues. There may have been some shortcuts taken by these suppliers, or even some incompatibilities which may cause issues like this. However, as Boeing decided on that method of production of these airplanes, they have to take the blame for it.

    The optimist in me wants to think the project managers thought of all of these risks, and this was indeed just a fluke, but the pessimist in me thinks they under a big time crunch from leadership at Boeing to get these issues fixed and approved by the government. My fear for Boeing is that this second issue is going to tarnish their reputation even further.

  4. The Dreamliner has been on the news for the wrong reasons lately. I think you are right in saying that there will be issues when you are outsourcing from outside. I am sure Boeing would have checked the quality of the subassemblies, but when you try to skimp on quality to save on time, sooner or later, it will cause you to spend more time than what you would have spent had you not compromised on quality. While Boeing will probably overcome this latest setback, investors and airline companies will be cautious about this stock in light of the potential risks. I am sure the Boeing project managers are working on the technical issues, but I think there are going to be more instances of similar or new kind of issues with the Dreamliner in the future.

  5. While it most certainly could be a project management related issue, I think there’s also a good possibility that it’s a quality issue with the materials. One could argue that the project manager is still responsible for overseeing the materials selection but a lot of times the procurement department dictates buying decisions. At least that was the way it worked at the manufacturing company I worked at.

  6. It is hard to say who should be blamed for all those Dreamliner issues. It may be management, suppliers, quality, assembly, etc. We need more details. It looks to me that Boeing is following car manufacturers in production of their latest product. Most of the car companies supply cars components from the 3th party organizations and then assemble them in their own factories. In the last decade, because of reliance on other companies poorly made parts and lack of strong quality controls, many carmakers had a lot of issues with their final products. In case of Boeing’s last child, situation seems to be similar. To fix it, they should again follow the solutions car companies implemented to fix their issues with supplied components and product assembly. If they do not review and correct those areas, they will keep having more issues.

  7. I agree with Aneta that Boeing did use a similar model for building the 787 that car manufacturers have been using for decades. However, building a plane is a much bigger project by several orders of magnitude. Boeing tried to incorporate too many “industry firsts” in this brand new plane, and attempting to do all of these things using so many third parties and relying on a global supply chain…this was not a good idea from the start, to say the least. As if it wasn’t a big enough nightmare before the first plane was finally delivered, it’s been one problem after another ever since.

    I feel that if Boeing had implemented a good risk management process from the start, they would have mitigated the biggest risk by not even attempting to do what they did in the first place!

  8. The problem facing Boeing could be a combination of project mis-management as well as lack of technical expertise. Although assembling components from different vendors is a challenging task, it is made that much harder when it is something as complicated as an airplane. To make things worse we need to keep in mind that we are looking at something that demands zero tolerance for defects. Perhaps management was short-sighted not to realize this risk. Then again perhaps engineers failed to test the plane properly before making it available for wider commercial use.

  9. Going toward different way of manufacturing that model of aircraft from the traditional way of manufacturing everything to outsourcing many of the aircraft parts and to assemble them by Boeing. This would change the way projects are done and managed in Boeing. It seems to me that this would be one of the main causes, in addition to the quality issues, to have many issues in this model that were not fixed properly after being reported.

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