Boeing 787 Dreamliner Delayed Again. Collaboration Can Be Very Hard.

Posted by: Bruce Nussbaum on January 16, 2008

News that delivery of the Boeing Dreamliner will be delayed a second time due to parts problems highlights the true truth about globalization and collaboration—it is extremely hard to manage well.

Problems appear to be in Italy on the fuselage. Boeing apparently assumed that its contractors overseas would be able to manage their own subcontractors properly—or it misjudged on just how much subcontracting would take place. Either way, problems seem to be on this second tier level.

How much autonomy do you give partners in a global collaborative effort? How much direct control do you need? What about trust? How do you account for differences in culture?

All these are key issues for global managers today.

Reader Comments

Gus

January 17, 2008 10:54 PM

This subcontract matters is a constat issue on business world.
Autonomy can't be confused with lack of control or management. Culture is a big issue also, it seems and feels that moving fast organizations really crash when making business with slower ones, but country culture is also a key point, and managing it is a hard job. I never had problems in my company, but I always hire forein companies and plants. As I see, a closer and tight management stile could help reducing this king of "deficiency".

Diane Rambow

January 18, 2008 7:16 AM

As a former sub-contractor; approved supplier to Boeing, I can draw on my own experience.

They essentially 'threw out the RFQ' to 'any and all' - and let the first one who could produce a 'working prototype', win the awarded contract.

There was virtually NO site inspection; NO checks into what might possibly cause us to default - NO inquiry into our financial stability. Why? Because they had so many other contractors 'waiting in the wings', they felt there was no need.

Okay - so we performed and came in with 'flying colors', but what if we hadn't!!!???!!!

Our call for assistance program was part of a critical portion of their asesmbly-line program.

Why did they 'go out for bid'? Well, they'd built an airplane - wound up with ONLY ONE WING (ouch - inventory-control 'sucked'), and they were to supply this airplane to - well let's say, it wasn't for a customer in the USA.

Boeing has a 'surplus store' - we could 'shop there' because we were on the approved suppliers list (never sure why we were given that benefit). We visited that HUGE store; BRAND NEW office equipment was sold for a 'song and dance'. We felt like we'd fallen into some type of 'dream' - heaven it was, as we carried out needed items at a fraction of the cost.

I finally couldn't buy another thing without asking the key question - WHY??? We were told that when they bid a project, they buy ALL NEW EQUIPMENT as they 'set up a project/shop', and hire people for the project. Once the project is done, people get relocated (or laid off), and all this wonderful 'stuff' is put in their 'outlet' store, and then the employees and approved vendors are allowed to come; pay a few cents for it, and haul it away (this allowed them a HUGE WRITE-OFF) to avoid paying more taxes than they WANTED to pay.

We were paid on a 30-day invoicing program; so we billed accordingly. When we hadn't received payemt 90 DAYS AFTER THE BILING, I called to 'collect'.

The person I spoke with practically laughed, and said "We don't bother with that 30-day stuff; we pay when we want to!"

Okay, I'm a small business - so I get angry. I write a letter to the PRESIDENT of Boeing. I remind them if everyone took that attitude, we'd all be out of business. I didn't get a reply. So, I sent a LATE PAYMENT BILING AND CHARGED THE APPROPRIATE FEE -and it was ignored.

I sent a copy of all this to the Post-Intelligencer (newspaper), and told them the dilemma. Thanks to the newspaper handling this (in public forum and view), I suddenly got an apology signed by the PRESIDENT of Boeing; a payment in full (plus late fees), and was told by the purchasing agent that: "I think you might very well be the first person to ever collect a late-payment fee from this company!"

I saved all this for later reference; I kept this to remind me that there are times when you have to kick 'Big Bird' square in the gut, so they'll remember where they once were; when they had to adhere to proper business ethics and practices.

No wing for an airplane; above paying late-payment fees, and from what I've read in this recent article, it seems Big Bird is still failing to see the light (because it doesn't HAVE to).

It's true, that allowing minority business; small business - disadvantaged business the chance to 'have a shot' at being a sub-contractor and supplier, can have its downside, but I think this program can be managed effectively.

Yet, when a large company simply says: "Hey, so we're late - we'll pay the daily penalties for being late because we can afford it", you've got a company that's just an over-sized elephant that can't feel the grass under its feet; nor the small industry its crushing in the process.

When money isn't an object, then the objective won't be about profit and performance.

Boeing lives in a 'gray world of rain'; a 'gray world of gray clouds', and they sit in little cubicles - gray chairs; desks, and dividers that can be moved so when they add employees, they can 'change the scenery'; when they lay off employees, they can make a larger cubicle so when they're bored, they can shoot paperwads into the wastebaskets at a longer distance (3 points if you can get it all the way to the President's office).

Do I have an ax to grind? No, I got my personal gripe resolved, but darn - it sure wasn't easy talking to a deaf, dumb, and very wealthy mute!

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Want to stop talking about innovation and learn how to make it work for you? Bruce Nussbaum takes you deep into the latest thinking about innovation and design with daily scoops, provocative perspectives and case studies. Nussbaum is at the center of a global conversation on the growing discipline of innovation and the deepening field of design thinking. Read him to discover what social networking works—and what doesn’t. Discover where service innovation is going and how experience design is shaping up. Learn which schools are graduating the most creative talent and which consulting firms are the hottest. And get his take on what the smartest companies are doing in the U.S., Asia and Europe, far ahead of the pack.

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