Analysis of Boeing 787 Dreamliner Project Management Issues

This report provides a comprehensive analysis of the Boeing 787 Dreamliner project, focusing on the key issues that led to its challenges and failures. It delves into problems such as supply chain disruptions, poor vendor selection, and the impact of outsourcing on quality and project management. The report critically evaluates how the project could have been managed more successfully, exploring aspects like project life cycle planning, manpower allocation, maintaining the triple constraints, and the importance of an integrated approach. It highlights the need for aligned organizational and project strategies, proper supplier selection and training, and well-defined contract terms. The conclusion emphasizes the significance of these factors in mitigating risks and ensuring project success, offering valuable insights for future aviation projects and other large-scale ventures. The report also provides recommendations for improved project management practices based on the lessons learned from the Boeing 787 Dreamliner project.

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Boeing 787 Dreamliner
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Table of Content
Brief introduction............................................................................................................................4
The company.............................................................................................................................4
The project.................................................................................................................................4
The project problems.....................................................................................................................4
Supply-Chain Issue:...................................................................................................................4
Wrong selection of Vendors:......................................................................................................5
Not listening to the advice from In-house team:.........................................................................5
Poor quality of components by vendors.....................................................................................5
Critical evaluation on how the 787 Dreamliner project could have been managed more
successfully...................................................................................................................................5
Project Life Cycle Planning........................................................................................................5
Proper section of manpower......................................................................................................6
Maintaining the Triple Constraints of Project Management while schedule crashing................6
Proper Integrated approach.......................................................................................................6
Organization Strategy need to be aligned with Project Strategy................................................6
Proper Selection of Supplier and Train them.............................................................................7
Proper Contract terms with supplier...........................................................................................7
General Conclusion.......................................................................................................................7
References....................................................................................................................................8

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Brief introduction
The company
Boeing is world’s biggest manufacturer of defense, space and commercial aircrafts; it
has a very strong history of presence in the aviation sector. Its plane or service is
spread over 150 countries (Boeing 2017). Boeing also provides freight support and
around 90% of the freight lanes are supplied by Boeing.
The project
Innovation is in the trend of Boeing and it always looks for creating something new to
provide more comfort to passengers with less cost. The project ‘787 Dreamliner’ was
conceptualized to commercialize aero plane, its main body is made of composite martial
rather than aluminum which has resulted in reduction of weight and the 20% increase in
fuel efficiency (Allworth 2013). With such offer in conceptual design stage has created
many investments to book order for 787 Dreamliner.
The project problems
The boing team was so enthusiastic regarding saving time and money that they decided
to outsource the design and manufacturing of many parts to other vendors and by doing
so, Boeing was able to cut the cost from $7.3 billion to $4.2 billion and the time by 2
years (Okaily 2013). Few major problems raised during and after the development
phase of the aircraft are:
Supply-Chain Issue:
The development phase was purely dependent on numerous vendors or suppliers for
various Tier-1 parts assembly too and few particular systems like batteries, electrical
framework and so forth which were not provided with required quality and in time, so
because of complex store network administrations it got postponed. Initial dead line for
the commercialization conveyance was May 2008, yet it endured around 3 years of
delay and could get quality was passed by AAA in August 2011, so Boeing had to pay
tremendous penalty of around $ 4 Billion. The main reason behind the problem was not
only the outsourcing but the local assemblies. Traditionally, Boeing used to buy items

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from outside vendors, but the hard core assembly of Tier-1 was the only responsibility of
Boeing itself, but in this 787 Dreamliner project they left the assembly portion too along
with vendors.
Wrong selection of Vendors:
Without checking the vendor’s capability of doing the job the Dreamliner, Boeing had to
place the orders. But in doing so Boeing lost his control over the manufacturing and
assembly processes, and this is the real cause of today’s accident. Unlike Toyota, it
also depends solely to small manufacture
Not listening to the advice from In-house team:
To create airplane with cost cutting, Boeing needed to neglect the claim developed by in
house innovation as exhorted by specialized master and search for outsourcing and it
was the real reason for its disappointment.
Poor quality of components by vendors
As per the author (Gates 2013), the electrical batteries, battery chargers and even the
electric panel is supplied with very low quality material which can break any moment of
time.
Critical evaluation on how the 787 Dreamliner project could have been
managed more successfully
With traditional approach of developing the aircraft, Boeing required $7.3 billion with 4
years, but they looked for some innovative approach of supply chain and reduced the
planned cost to $4.2 billion and time within 2 years, but actually the development cost
incurred by Boeing took more than $11 billion and the time of completion around 4
years from the planned date. Now let us evaluate the ways it could have been
prevented are as follow:
Project Life Cycle Planning
Since one same size cannot fit the entire requirement, so separate Project Life Cycle
Planning need to be done for every different project (Shenhar et al. 2016). All the

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related stages ‘Define’, ‘Planning’, ‘Execution’ and ‘Closing’ should have been
discussed and planed, then surely while conducting the process ‘Stakeholder
Management’ and ‘Resource Acquisition’ these issues would have come up. So an
integrated life cycle planning could have provided few more information and loss could
have reduced.
Proper section of manpower
Proper experienced person should have been recruited at right time to provide proper
guidance on the procedure to select supplier, mange supplier and close procurement
stages (Okaily 2013). Any experienced Project Manager would have predicted the
situation well before by using various project management evaluation techniques and
accordingly preventive steps could have been taken to prevent loss or penalty.
Maintaining the Triple Constraints of Project Management while schedule
crashing
As Boeing has crashed the schedule from 4 years to 2 years along with the cost from $
7.3 to $ 4.2 billion, but as per triple constraints time/schedule, cost/resources and
scope/quality are interlinked to each other. Any impact on one of the factor has its effect
on other two (Program Success 2011). So, if the time and cost both decreases then
quality/scope is bound to be decreased, exactly the case happened in Boeing. The
quality of material supplied by suppliers are very poor specially the electrical system
package.
Proper Integrated approach
By taking proper step in which an integrated planning approach was required to be
conducted to know the relationship between the cycles of project management, any
cycle should not mix with the other. All the project needs are required to be aligned with
the organization’s strategy to suit the culture of the organization, otherwise full support
of team cannot be obtained and such similar case could have been prevented.
Organization Strategy need to be aligned with Project Strategy
Proper planning was lacking in Boeing 787 project, otherwise the proper documentation
of SWOT (Strength, Weak, Opportunity and Threat) analysis is must. Good analysis of

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SWOT can provide all kind of alarms well in advance and such big loss could have been
prevented.
Proper Selection of Supplier and Train them
First of all untrusted suppliers were awarded the design, manufacture and who do not
even understand all the project management terminology. So in that case if cancellation
of job awarded is not possible, then they must be provided proper training to take care
of the responsibility assigned on them and always conduct shop visits frequently to
control the job statuses.
Proper Contract terms with supplier
The contract agreement between the supplier and Boeing should have been done in
such a manner that the risk of failure can be shared by both and the deadline of
submissions too should be mentioned in the contract itself with strong penalty clauses.
Such proper sharing of risk could have made supplier more concerned about the project
and could have delivered the systems earlier than the current situation.
General Conclusion
After conducting the above study it can be concluded that the main reason behind the
failure of Boeing 787 Dreamliner project is the outsourcing of design, manufacture and
assembly to outside suppliers who had no or very less such past experiences and this
resulted in losing control over the design and manufacturing stages of development.
Moreover the contract with supplier must have been developed after giving much more
considerations on risk sharing approach. The internal stakeholders issue or concern
was overlooked and Boeing had to pay few billion dollars as penalty, so all team
members comments need to be listen and evaluated which was not the case when
accident took place.

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References
Allworth, J 2013, The 787’s Problems Run Deeper Than Outsourcing, viewed 20 August 2017,
<https://hbr.org/2013/01/the-787s-problems-run-deeper-t>.
Boeing 2017, Boeing in Brief, viewed 21 August 2017, <http://www.boeing.com/company/general-
info/>.
Gates, D 2013, Boeing 787’s problems blamed on outsourcing, lack of oversight , viewed 20 August 2017.
Okaily, M 2013, Boeing 787 dreamliner project lessson learned, viewed 21 August 2017,
<https://www.slideshare.net/farrag123456/boeing-787-dreamliner-project-lessson-learned>.
Program Success 2011, Scope, Time and Cost – Managing the Triple Constraint, viewed 20 August 2017,
<https://programsuccess.wordpress.com/2011/05/02/scope-time-and-cost-managing-the-triple-
constraint/>.
Shenhar, A, Holzmann, V, Melamed, B & Zhao, Y 2016, 'The challenge of innovation in highly complex
projects', Project Management Journal, vol 47, no. 2, pp. 62-78.