BOEING
Annual Report 2003 Strategies: Run healthy core businesses Leverage strength into new products and services Open new frontiers
Core competencies: Detailed customer knowledge and focus Large-scale systems integration Lean enterprise Worlds leading aerospace company Top US exporter in terms of sales Global market leader in commercial jetliners, military aircraft, satellites, missile defense, human space flight, and launch systems and services
Articles de Presse
Une concurrence frontale avec le 7E7 de Boeing (10 dcembre 2004)
A350 contre 7E7 Dreamliner. La concurrence entre Airbus et Boeing va tre frontale sur le march des long-courriers de taille moyenne. Par consquent, la guerre commerciale va s'intensifier auprs des compagnies ariennes, qui se verront proposer deux nouveaux avions la mise en service trs rapproche : en 2008 pour l'amricain et en 2010 pour l'europen. Le march est estim 3 100 avions pour les vingt annes venir. Les derniers programmes lancs (A380 en 2000, 7E7 en avril) laissaient penser que chacun des deux groupes aronautiques avait choisi de convoiter le secteur le plus rentable de l'autre: avec l'A380, un avion deux niveaux de 550 places minimum, Airbus a vis le crneau des gros porteurs, o Boeing est seul avec son 747. Quant au constructeur amricain, il entend moderniser sa prsence sur les appareils long-courriers de taille moyenne, un march domin par l'A330, en lanant le 7E7, qui compte de 217 290 siges. Pour justifier ces options stratgiques, chaque constructeur avait alors avanc des prvisions diffrentes concernant l'volution du trafic arien mondial. L'avionneur europen a dclar miser sur un dveloppement des grandes plates-formes aroportuaires de connexion (les "hubs") desservies par de gros avions, permettant de dsengorger le trafic arien. Boeing, l'inverse, a affirm que l'avenir tait la multiplication des lignes nationales et internationales. Il s'agit alors de liaisons "point point", qui permettent des avions de taille moyenne de relier directement les villes entre elles, sans passer par de grands aroports de transit. L'anticipation amricaine tait exacte, les compagnies ariennes clientes dAirbus ont exprim un rel besoin pour des liaisons point point sur de longues distances avec des avions de moyenne capacit.
[EADS devrait dcider prochainement du lancement d'un nouvel Airbus, l'A350 Cet appareil serait un concurrent direct du futur Boeing 7E7. Son premier vol pourrait avoir lieu en 2009. Le montant de l'investissement ncessaire oscillerait entre 2 et 3,5 milliards d'euros . D'ICI la fin de l'anne, Airbus saura s'il peut lancer un nouvel avion commercial, l'A350, destin concurrencer le futur 7E7 dreamliner de Boeing.] Boeing devrait contre-attaquer lannonce de lA350. Rgulirement, le constructeur rappelle qu'il a dans ses cartons un projet de "747 advanced" pour contrer l'expansion de l'A380.
L'aviation tire les rsultats du conglomrat franco-allemand (13 novembre 2004)
Prsent dans l'aronautique, la dfense et l'espace, le groupe EADS a totalis plus de 30,1 milliards d'euros de chiffre d'affaires en 2003 pour 109 135 salaris. Il revendique le titre de leader mondial des avions (avec Airbus) et des hlicoptres (Eurocopter). Il est prsent dans les missiles en association avec MBDA, dans les avions militaires de transport (A400M) et dans le programme Eurofighter. Il joue un rle essentiel dans le systme de navigation par satellite Galileo. Tir par les bons rsultats de l'aviation, il a lgrement revu en hausse ses prvisions pour 2004 lors de la prsentation des rsultats des trois premiers trimestres, le 4 novembre.
La nomination de Condoleezza Rice confirme le conservatisme de l'administration Bush (16 novembre 2004)
En envoyant Condoleezza Rice au dpartement d'Etat, George W. Bush entend reprendre en main la diplomatie amricaine, qui a toujours manifest une certaine indpendance vis--vis de la Maison Blanche. George W. Bush a officieusement nomm mardi sa conseillre la Scurit nationale, Condoleezza Rice, la tte du dpartement d'Etat, o elle succdera Colin Powell, dmissionnaire. "Au cours des quatre dernires annes, je me suis appuy sur ses conseils, bnficiant de sa grande exprience et apprciant son discernement fiable et quilibr. Et prsent, je suis honor qu'elle accepte de servir dans mon cabinet", a dclar le prsident des Etats-Unis. Article distribu Military Aerospace business Civil-jet -> Airbus Booming market -> price war Suppliers could not keep up with production Aircraft sales are expanding by 5% a year. New markets: avionics upgrade (concurrent: Lockheed Martin), air-traffic management (-> satellites), broadband communications (television and high speed data) Competition The two primary sectors of the aerospace industry, commercial and military aviation, are each dominated by two key firms: Airbus Industrie and Boeing in the commercial sector, and Lockheed Martin and Boeing in the military sector. Alliances are utilised by both major players in commercial aviation, while acquisitions are the principal strategies selected in the military aviation industry. Boeing appears to shift its strategic choices appropriately by industry to match its competitors as well as to correspond to the approach advocated by related technology strategy literature.
Surfer sur Internet bord de vols longs courriers dont les avions sont fournis par Boeing sera de plus en plus ais travers le monde. Un accord vient en effet d'tre sign entre le constructeur aronautique amricain et la socit iPass, fournisseur d'accs Internet aux entreprises. Le californien iPass dispose d'un portefeuille de 528 000 clients et d'un rseau de hotspots rpartis dans 121 aroports dans 21 pays. (AOF) - Boeing devrait proposer un nouvel avion aux compagnies ariennes en 2004: le 7E7. Le projet est n la suite de l'abandon du concept Sonic Cruiser qui n'avait pas suffisamment plu aux clients de l'avionneur. Aprs des semaines de turbulence lies au dpart du directeur financier et du PDG du groupe, le projet semble bien accueilli mme si des analystes mettent des rserves sur cet avion, dont Boeing vante les faibles cots d'exploitation. Le 7E7 concurrencera l'Airbus A330 et pourrait permettre l'avionneur amricain de restaurer ses parts de marchs par rapport l'europen. ST. LOUIS, September 10 /PRNewswire/ -- Boeing (BA la Bourse de New York) a annonc aujourd'hui qu'elle a obtenu un contrat de la part de DIRECTV afin de construire trois satellites du modle Boeing 702. Ces astronefs procureront DIRECTV une couverture ingale pour la diffusion nationale et locale d'missions de tlvision haute dfinition.
Organisation de Boeing (site internet)
Boeing is organized into four major business units: Boeing Capital Corporation, Boeing Commercial Airplanes, Connexion by BoeingSM, and Boeing Integrated Defense Systems. Supporting these units is the Boeing Shared Services Group, which contributes common services and efficient infrastructure services that enable the company's business units to concentrate on profitable growth. In addition, Phantom Works provides advanced research and development, including advanced concepts for air traffic management. Phantom Works partners with the companys business units to identify technology needs and address them with innovative and affordable solutions. Boeing Integrated Defense Systems provides end-to-end services for large-scale systems that combine sophisticated communication networks with air-, land-, sea- and space-based platforms for global military, government and commercial customers. The company offers an extraordinary range of defense and space systems products and services. It designs, produces, modifies and supports fighters, bombers, transports, rotorcraft, aerial refuelers, missiles and munitions and is on the leading edge of military technology through its unmanned systems development efforts. Boeing Integrated Defense Systems also supports the U.S. government on several programs of national significance, including the Missile Defense Agency's Ground-Based Midcourse Defense program, the National Reconnaissance Office's Future Imagery Architecture, the Air Force's Evolved Expendable Launch Vehicle program and NASA's International Space Station. The company has become the systems integrator for several new programs, including the U.S. Army's Future Combat Systems and Joint Tactical Radio Systems, the Family of Advanced
Beyond Line-of-Sight Terminals for the Department of Defense, and the Explosive Detection Systems for the Department of Transportation. Shared Services Group allows business units to focus on profitable growth by providing the infrastructure services required to run their global operations. The group provides a broad range of services worldwide, including computing and network operations, e-business, facilities services, employee benefits and programs, security, transportation, and the purchase of all non-production goods and services. It also gives direction to safety, health and environmental planning and offers comprehensive travel services to Boeing employees and corporate customers through the Boeing Travel Management Company. In addition, Shared Services Group manages the sale and acquisition of all leased and owned property through the Boeing Realty Company. By integrating services, Shared Services Group delivers greater value, creates "lean" processes and operations, leverages buying power and simplifies access to services. Connexion by Boeing is a mobile information services provider revolutionizing the way people on the move communicate and inform and entertain themselves. It does so by providing real-time, high-speed, two-way Internet-based connectivity to mobile platforms. Connexion by Boeing serves three important market segments: commercial aircraft operators and their passengers; executive aircraft, including operators of private and government executive jets; and the maritime market. Using laptops or personal digital assistants (PDAs), passengers can enjoy secure high-speed access to the Internet, personal and business e-mail accounts, and company intranets. They also are able to send and receive attachments and view entertainment all at DSLlike speeds. Connexion by Boeing's value extends beyond passenger services. The service also brings value to aircraft operators, enabling them to use Connexion by Boeing's extraordinary bandwidth to obtain operational efficiencies, improve customer service and enhance security. A worldwide network of ground stations and round-the-clock customer care supports the service. In the United States, the Connexion by Boeing service is currently available to the executive services market, including operators of private and government aircraft. Internationally, its available to select transatlantic routes for Lufthansa. Commercial airline passengers were first introduced to the service in the first quarter of 2003, when both Lufthansa and British Airways conducted threemonth service demonstrations. In addition to Lufthansa the launch customer for the service All Nippon Airways, China Airlines, Japan Airlines, Korean Air, Scandinavian Airlines System and Singapore Airlines have announced plans to equip long-range jetliners in their fleets with Connexion by Boeing service. Full-scale launch of the service occurred in May 2004 on transatlantic routes.
Group 10
PEST Analysis Social/Cultural o Safety-conscious: more people realize that travel by air is safe, but anxiety towards terrorism, etc o Dependant on the travel habits of the consumers: worldwide holidays, business, etc
Economic o Cyclical market : very dependent on the airline industries and world economy o Punctual crisis: example September 11th, SARS; war in Irak o Renewal of the fleet o Price-war with Airbus o Markets are dependent on the commercial axes o Low cost companies-> competition for the price of the plane tickets result in airline companies buying refurbished airplanes instead of new ones o Emerging countries: what will be the next important axes? o Importance of Asia o High oil price has some negative effects on airlines Political/Legal o Civil/military: war? o Part of the world: political links between countries (Turkey buying Airbus) o FAA : long to accept changes -> difficult to implement new technologies, can delay the launch of a new product o Air traffic control: could take ages to certify a new system; because it has to be perfectly safe o Political issues : US government funds most of the american aerospace research; they decide what new areas to explore, etc American military budget for 2002 more than twice the European budget o National conditions: for example, China: fast growing economy, WTO entry, more travel visas, 2008 Beijing Olympics, 2010 Shanghai expo, 2010 Guangzhou asian games Technological o Four axes : navigation, energy consumption, safety, noise reduction o Airbus : new A380 -> find competitive system : BWB (more volume) o New technological capabilities: new opportunities -> air traffic, broadband, etc o Is it sure enough to be implemented? Is it worth it? (composite materials, etc) o New technology increases cost / cost of the product has to decrease o Increase of automation The market o 5% increase a year for commercial aircraft sales o 6% increase a year for cargo aircraft o uneven increase of the market for the different geographical areas big increase in Asia key axes: Asia <-> Europe and Asia <-> America o $214 billion (50% US, 34% Europe) o Boeing: middle size aircraft (7E7) / Airbus: large size aircraft (A380)
o Civil/military: 50/50 globally o Great demand in three areas: long-haul flight, spot-to-spot flight and high-frequency flight Competition o Commercial aircraft: Boeing/Airbus o Military: Lockheed Martin/Boeing o Only Boeing and Airbus have a wide range of applications and a well balanced portfolio (?) o Other companies are small (Bombardier, Dassault, Cessna, ) o Satellites (launch) > Ariane Espace, ILS Lockheed Martin Atlas, CGWIC (small market) o Broadband communications?
SWOT Analysis Strength o World leading aerospace company o Wide range of products and activities o Several mature but still popular models o Link with US government: indirect subsidies for Boeing; receives from defense and other government research agencies o Lead in Asian-Pacific market with a 72% total market share in the region based on installed fleet. This market has the most potential and is composed of: Singapore, Australia, Japan, China and South Korea, with India rising fast as a key commercial aircraft buyer. Weaknesses o Loss of technological leadership to Airbus o No profit culture o Non-optimized organization o Has had several non profitable experiences Opportunities o US military budget is very high compared to the European military budget o Research projects funded by the US government can later be used for commercial applications o Good prospect for the Space and Communications section: e.g. Boeing satellite systems enable HDTV high coverage in the US. o Is investing in new promising markets: broadband communications is becoming an important branch of the firm o Increasing market
o Possibility to gain some market shares in the cargo business over some other means of transportation if the costs are decreased (BWB, Pelican, etc) Threats o Lack of stability of the market (dependent on the geopolitical situation) o Increasing of the importance of the European Union -> redefinition of the commercial and political axes o Investing too much in a risky project: delays with FAA, etcbut risks necessary to gain market shares o Pb: increase of the market insufficient for making a new product profitable? o Evolution of the market not clearly defined: middle size / large size??
Strategy Business: What business is the Company in (now)? Aerospace Capabilities (Technological Conglomerate) Transportation Military Weapons Transportation Comunication Links (Satellites): Broadband Internet, GPS What business do you think the Company should(needs) be in? New Strategy: Integrated Aerospace Systems (Complementary providing all services horizontal integration), Selling the Satellite business Objectives Leadership Close technological Gap Measured by: external Consultant asking chiefengineers of airlines Gain Market Share of Airbus back (Marketing Objective) measured by: sold and ordered planes develop logistical, safety ans capacity management system measured by: change in market Share and new contracts External Benchmarking asking chief air traffic controller & regulation authority Offer:
Airlines (Commercial): Individual Solutions Plane size Services Environment Fuel Noise Guarantees After Sales Service Availibility Government (Military): Superiority Technical advance Safety Homeland Security Control Surveillance Guarantees Reliability Long Term Support Segmentation: Military 1st by Alliance (product range) NATO / Neutral States / Restricted Countries 2nd by Military Budget Commercial 1st by Region USA / Asia / Europe 2nd by either... Low Cost carriers/ Classic Airlines Small Airlines/ Big Airlines Branding:
Financially strong Institution Office in the Airplane Flying was yesterday - today is Boeing Selling the Weapons (Rockets) business
January Group
PEST Analysis Political - FAA regulation: Sept, 11 governmental aid data protection standardisation national regulations
safety noise security environmental concerns
Social/ Cultural holiday behaviour business behaviour anxiety/ safety issues (SARS/ Sept, 11) globalisation individualisation acceptance data protection Customer/ The Market business/leisure travel new markets (Asia) low budget airlines service demand (internet on plane) flight control leasing (B2B) acceptance: authorities airlines airports
Economic competition open sky oil price tax growth factors (GDP) currency exchange rate Technical video conferences fast trains big planes computer/ internet hypersonic planes wing only rocket aviation wireless communication optical communication Competition EADS trains ships smaller companies military industry service industry communication industry (IP provider) airports computer industry SWOT Analysis Strengths US market global presence good relations to US government diversification the only high capacity plane constructor image/ reputation system knowledge complete offers Weaknesses old products little innovation
engineers culture weak position in Europe failed to develop wing-only no experience in competition fuel consumption only one business jet high service costs lack of experience
Opportunities service business flight control growing military market high capacity plane fast speed plane Asian market financing plane services synergy growth diversity gain Threats A 380/ Airbus growth terror/ SARS price war environmental regulations oil consumption -> rising tax authorisation financial trouble
Strategy 1. Type of business What business are we in? Air plane construction
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What business do we want/ need to be in? Air craft service business Air traffic management
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2. Objective
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Business objective: To be the world wide leader in air transportation services
Measured by: Over 50 % of the customers should believe that Boeing is the company which does Overall Air Solutions Achieved until 2009
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Business strategy By differentiation and establishing the brand Boeing in the service sector
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1) 2) 3) 4)
Marketing objectives market share in aircraft sales market share in transportation services ratio (air planes serviced/ air planes sold) number of people/goods transported
3. Customer Airlines, customer oriented and established Customer needs, problems security uneven demand inflight service premium image
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4. Segmentation
Security terror(sky marshall) diseases Air traffic management guiding flight control Information services inflight internet mobil phones Financing leasing uneven demand airport expansion Better planes air plane construction reducing flight time/ costs ecological issues
airport expansion hubs vs. point to point R&D/ innovation
Maintenance/ turnaround flight support turn around time/ stand still time boarding Fleet management 5. Brand & Positioning What position do we want to own? We want to be the number one in air transport solutions the first the biggest
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What is our branding policy?
SLOGANS Flying is Boeing Boeing is more than flying You choose we deliver Boeing Solutions Boeing Group
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prompt service all inclusive air transport reliability service flexible, multiple services/solutions (safety)
6. Value proposition/ Offering FOR premium airline
WHO flexibility and completeness high service requirements THE Boeing Smart Solution Group
THAT provides freedom to focus on the core business by flexibility UNLIKE only air plane constructing companies
OUR OFFERING For Premium Airlines with high requirements in customer services and flexibility, the Boeing Smart Solution provides an overall service package including air services, financing and air traffic management unlike traditional air craft manufactures. Our offer combines air craft related services with financial flexibility for more responsiveness to the markets and variable interiors for changing customer demand. THE ELEVATOR PITCH The responsive aircraft 7. Culture/system issues
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engineers culture no customer orientation tree type of organisation little communication in between the divisions little competent staff for services/ financial issues/ organisation customers view
Actions HR: reorganisation & staff exchange marketing: external & internal consulting advertising
