Following is my analysis in response to question 2.

1.    How well do you understand the key factors that drive business performance:
a. in Boeing’s organization?
As demonstrated over the years, Boeing must reorganize its vast enterprise to effectively run acquired companies as well as its core business and provide a single point-of-contact to its airline customers; overcome resistance to change and complacency; continually refine its production models to operate as a lean and agile competitor; ensure that Boeing’s vision is internalized and practiced throughout the entire organization.

b. in Boeing’s industry?
The airline industry is mature; there is no true differentiation between Boeing’s aircraft and its primary competitor’s (Airbus) planes. Boeing must therefore wrap the service component around its physical product (i.e. airplanes) in order to differentiate itself. Boeing must overcome price competition fostered by Airbus’ subsidies from European governments.

2. What must be done well to:
a. reduce costs?
Boeing must meet production schedules (for example delays cost the company $178 million in 1997); it must effectively right-size its organization in order to avoid cutting muscle while trimming fat; it should utilize IT effectively in all aspects of its operation such as design (e.g. 777).

b. grow revenues?
The company should expand into new markets; understand what its customers (airlines) and its customer’s customers (passengers) want and then deliver; and effectively use technology to lock-in airline customers by creating enough differentiation to avoid competing on a cost basis.

c. improve asset efficiency?
Boeing should reduce human interaction where appropriate (e.g. eTicketing, eReservations, electronic check-in kiosks) and reassign those human resources to more valuable/strategic work.

d. achieve sustainable advantage?
Boeing must help airline partners by providing services that reduce airline costs and help them survive short-term threats to their existence, and lock-in airline loyalty by providing revenue-generating services for up-cycle times; build end-to-end comprehensive solutions to counter competition from point-solution providers (e.g. IBM, Accenture).

3. How can IT be used to improve business performance?
Boeing must provide the solutions to address both its own and its airline partners needs. An example of an internal solution is computer-aided aircraft design as was used to design the 777. Partner solutions include the “e-Enabled Advantage” which was not a product per se, but a “way of doing things”. e-Enabled Advantage facilitated the following: kept a flying aircraft in an airline’s network seamlessly and helped improve dispatch reliability, reduced delays/cancellations, improved passenger service, enhanced aviation security, and provided end-to-end aircraft operational data which resulted in reduced aircraft maintenance costs.