Procurement and Risk Management Strategies

This assignment delves into the crucial aspects of procurement and risk management within the context of Boeing Airline. It examines how procurement plays a strategic role in the company's operations, emphasizing its influence on organizational development and execution of strategies. The text highlights the importance of sourcing methodologies, supplier relationships, technological advancements, and performance management in procurement. Furthermore, it analyzes Boeing's risk management practices, their adaptation to changing market conditions, and the impact of outsourcing procedures on product quality and delivery systems. The assignment concludes by discussing Boeing's strategic value creation through innovative procurement practices, fixed-price contracts, and orbit incentive payments.

Running head: PROJECT RISK AND PROCUREMENT MANAGEMENT
Project Risk and Procurement Management
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Name of the University;
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1PROJECT RISK AND PROCUREMENT MANAGEMENT
The procurement had a strategic and broader strategic impact. The influence of such
changes had its influence and they are within the reach of the organization. It has been found that
procurement plays an important role in the development and execution of the strategy of a
company. The organizations are playing an active role of the top level managers of the company.
The companies have also added various sourcing methodologies and processes and they adapt
with the supplier and thus take advantage of the power in the supply base of the company. The
technological changes also play an important role in the procurement process. It is also necessary
to identify the long term management strategies and collaborate with the key suppliers which
necessary for value creation. The performance management, information and the knowledge are
the key aspects of procurement management. It is also important to contribute to the bottom lines
and the top lines management of the company. The procurement leaders must also contribute in
the innovation of suppliers for the introduction of new product and also creation of new business
opportunities in the market. It is also necessary to manage the risk systematically and it is one of
the most important changes that have occurred in the company. The leaders of the company must
also use the supplier relationship process and this has helped them in managing their followers. It
is also seen that the leaders must follow a strategic value by pointing to the various
improvements in innovation and growth. It is also vital to have control over the technologies as
they allow visibility in spending. The successful leaders also must have access of the various real
time database of the company. The sourcing methods of the company have also changed and
this has increased the amount of procurement in the next few years. The procurement will also
have to gain visibility from the various spending processes. The companies have also used the
six sigma processes and thus manage the source pipeline accordingly. The supply chain
management of Boeing airline has also been changed. The suppliers have upgraded their existing

2PROJECT RISK AND PROCUREMENT MANAGEMENT
products and they are also changing the outsourcing procedures. The various products and
services are also upgraded and thus the customers are supplied with higher quality products. The
product is directly supplied in accordance with the demands of the retailers and the suppliers.
This procurement process has also changed the operational processes and the delivery system has
also been changed. Boeing Airline has also adopted low economies of scale with lower cost of
labor and it has engaged more effective suppliers. Boeing has also entered the fixed price
contract. Moreover, the contracts are associated with the commercial satellites and the
government must try the extensive procurement regulation policies and thus it will increase
Boeing’s cost. The orbit incentive payments are also paid prior to the various satellite payments
if they are at risk or if they do not perform well. Moreover, Boeing also avoids the multi million
investment of dollars which plays an important role in making engines. Thus, it can be said that
the company focuses on various production stages and this has also helped in value addition.