Business Development Strategy: Murasaki Aircraft Corporation Analysis

This report provides a comprehensive business development strategy for Murasaki Aircraft Corporation (MAC), a company seeking to enter the international aircraft market. The analysis begins with a study of the project management cycles of Airbus A380 and Boeing 787 Dreamliner, highlighting their successes and failures. Key lessons are derived from these case studies, emphasizing the importance of effective communication, cost management, and competitive strategies. The report then offers specific recommendations for MAC, including integrating marketing into project management, continuing production of regional jets, and expanding into both developed and emerging markets. The report aims to help MAC avoid the pitfalls of its competitors and establish a strong market position, offering a clear roadmap for sustainable growth and competitive advantage in the aviation industry. The report also emphasizes the need for strategic partnerships and careful financial planning to ensure the company's success.

Running head: BUSINESS DEVELOPMENT STRATEGY TO FLY HIGHT
Business Development Strategy to Fly High
Name of the Student:
Name of the University:
Author Note:

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BUSINESS DEVELOPMENT STRATEGY TO FLY HIGHT
Table of Contents
Introduction:...............................................................................................................................2
Project Management Cycle of A380 aircraft and Boeing’s 787 Dreamliner and outcome:......2
Lessons learnt from these two airline makers:.......................................................................4
Lesson 1:................................................................................................................................4
Lesson 2:................................................................................................................................5
Lesson 3:................................................................................................................................6
Lesson 4:................................................................................................................................6
Recommendations in strategies to MAC:..................................................................................7
Making marketing a part of the project management strategy:..............................................7
Continue production of regional jets and international standard aircrafts:............................7
Expansion into the developed and emerging markets:...........................................................8
References:.................................................................................................................................9

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Introduction:
The paper aims to study the operations of international projects taking the competitive
market of airlines manufacturing as the background. The case study, which forms the
substratum, mentions three companies, which give direction to the study. Murasaki Aircraft
Corporation (MAC) with its strong shareholder base of MNCs like Toyota and already in the
regional jet industry is seeking to enter international aircraft market. The CEO of the
company wants to find out strategies to enter international market following the style of irbus
and Boeing but wants to avoid their flaws. This intention of the CEO forms the basis of the
sections, which make up the study. The section deals with the brief study of Airbus and
Boeing, their ambitious aircraft building projects and their flaws in managing those projects.
The next section elaborates these flaws to out lessons, which Murasaki must learn from the
mistakes of Airbus and Boeing. The final section consists of recommendations for the airlines
company based on these learnings. The recommendations unlike the learning section go
beyond the flaws of the two aircraft-manufacturing giants namely, Airbus and Boeing. The
section also covers aspects like marketing and international expansion, which Murasaki can
adopt to strengthen its operations.
Project Management Cycle of A380 aircraft and Boeing’s 787 Dreamliner and outcome:
The strategic management of A380 aircraft shows that the French airline
manufacturing company Airbus uses advanced methodology to control the airline
manufacturing operations. Airbus controls project management cycle at every stage including
initiating the manufacturing projects worth millions of dollars, planning of manufacturing
operations, execution. The efficient project management procedure spans over the areas like
monitoring and control but does not include closing of these projects.A380 manufacturing
project was one of the most ambitious projects and the company chose to partner with

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German airline manufacturing company Hamburg to ensure successful execution of the
project. However, the consortium of the French and German was not as successful due to
conflict between them. There were several flaws due to lack of cooperation among the
management of Airbus and Hamburg. Hamburg designed advanced software for the use of
the aircrafts but the same was not compatible with the older versions, which were already in
use by the French airline company. This prevented smooth flow of project related between
the two companies. The outcome of the lack of communication and collaboration between
Airbus and Hamburg resulted prevention of installation of parts into the bodies of the
airbuses. This ultimately led to halting of production of the ambitious A380 aircraft and
Airbus suffered a loss of over $6 billion. The final outcome of Airbus to manage the A380
project was that the company had to postpone the delivery of the aircrafts to its esteemed
client Singapore Airlines by two years (company.airbus.com, 2017).
Boeing’s 787 Dreamliner is one of the ambitious projects taken by the American
airline manufacturer Boeing Commercial Airplanes. Dreamliner 787 was the first plane with
a fuselage having a composite barrel in the place of old-fashioned aluminium sheets used by
the existing aircrafts during that time. The makers, Boeing Commercial spent a huge amount
amount of money to money to manufacture the airplane and collaborated with international
partners like NASA Ames Research Center. The company in order to ensure to accurately
execute the project entered into subcontracting with Mitsubishi heavy industries of Japan and
Korea Aerospace Industries of South Korea. The project execution of Dreamline 787 cost an
estimated Boeing $ 32 billion (Boeing.com. 2017). The cost of purchase to obtain the
expensive components exceeded the cost of purchase of its assembly facilities. The airways
as result started suffering heavy loss on each aircrafts it manufactured. JPMorgan Chase
estimated that BOEING suffered a loss of $45 million per aircraft. The aircraft manufacturer
started incurring heavy losses on each of its delivery of its airbuses to its clients. The

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outcome of the losses resulted in high operating costs of manufacturing aircrafts for Boeing
and the company was forced to cut its operations and production costs to make up the losses.
Another significant factor that led to tremendous loss to the ambitious project of Boeing 787
was the increasing competition from Airbus 380. The outcome of the excessive cost of
production was that the company started to increase the production of Boeing 787 and sell
them in the market to make the loss up. The company aims to add a hundred aircrafts to its
current fleet by the end of 2017 (Airbus-dscomm.com. 2017).
Lessons learnt from these two airline makers:
Murasaki Aircraft Corporation (MAC) wants to enter the manufacture of medium
sized passenger carrier market. The management of the company must take the following
lesson from the flaws committed by big players like Boeing and Airbus and and their
outcomes:
Lesson 1:
The project management history of manufacture of Airbus 380 and Boeing 787 has
important lessons Murasaki Aircraft Corporation (MAC) can learn. Airbus in order to
manage, plan and execute its ambitious aircraft project opted for partnership strategy. The
partnership strategy the company chose to manufacture Airbus 380 was consortium with
Hamburg of Germany. This strategy was apparently very promising and profitable for both
Airbus and Hamburg. However, the lack of communication and collaboration between the
apex management bodies of the two companies led to application of faulty technology.
Airbus used the old version of software while Hamburg used newer version of the same
software (Airbus.com. 2017). However, the two versions did not prove compatible which
resulted in hindrance in further advancement of the project management of building Airbus.
Murasaki Aircraft Corporation while manufacturing medium sized passenger jet should be
careful while choosing the mode of management of its ambitious project. The case study

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shows that MAC has stake owners like Mitsubishi Corporation and Toyota Motor
Corporation. The management of the company would take prudent decisions if it enters into
partnership with its stakeholders. The stakeholders Mitsubishi and Toyota are stakeholders of
MAC. As a result, give more support to the latter, if they enter into partnerships. This is
because they as stakeholders would want MAC to operate more successfully in order to gain
more capital maximisation. MAC can enter into partnerships with external organisations to
make medium size aircrafts only after it gain considerable penetration in the competitive
market of international aircraft manufacturing. The first Murasaki Aircraft Corporation can
learn from the management faults of Airbus is that; it must first gain competitive advantage
in the international aircraft manufacturing market. This will entitle the company to gain equal
position and say in the partnership (Kerzner 2013).
Lesson 2:
The history of Airbus reveals that the management bodies of Airbus and its partner
suffered from flaws like lack of communication and collaboration. They kept on blaming
each other’s strategies, which ultimately led to various defects. The conflict of interest caused
huge gap in the flow of communication. This conflict blocked sharing of knowledge and
technology between the two partners. Since, modern aircraft is largely dependent on flow of
knowledge and technology, this blockage jeopardised installing advanced on the aircrafts.
This led to Airbus delaying its delivery of aircrafts to its customer Singapore by two years,
which caused losses worth millions. The lesson MAX can learn from this mistake is that
while management of aircraft manufacturing project with third party firms, the
management should maintain strong communication with the management of the
partner (Schwalbe 2015). This would lead to smooth flow of information and technology
between the two partners. The management of manufacturing project should take place under
close supervision of the two partners. This would lead to reduction of wastage, more accurate

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and dynamic decision-making and cost management that would allow both the companies to
gain cost efficiency in production of aircraft.
Lesson 3:
The third lesson Murasaki should learn while manufacturing airplane manufacturing
project is that it must manage costs very effectively. The history of Boeing 787 shows that
the manufacturing company of the aircraft, Boeing Commercial Airplanes did not keep
sufficient control over the budget and the expenses. The company invested a huge amount of
money towards subcontracting and testing the aircraft. The company started incurring losses
on delivery of the aircrafts, which were several times the projected profits. Murasaki being a
new company in commercial airplane manufacturing market should not invest excessive
cost on testing and promoting the aircrafts. The company should instead choose economic
ways of manufacturing aircrafts by keeping the cost of production low and making low cost
flights. The company can launch on manufacturing ambitious aircrafts only after it succeeds
in earning profits and gaining commanding position in the international market (Fleming and
Koppelman 2016).
Lesson 4:
The fourth lesson that Murasaki can learn is that it should make strategies to
counteract challenges from the competitors during the project execution stage. The history f
production of Boeing shows that the company had to cut the sale price, which inhibited the
company from earning profit from sale of expensive Boeing aircrafts. Murasaki should
enter the market by producing low priced aircrafts. This will enable the costs of
production to be lowered in order to save expenditure. Again, in order to gain stronger
competitive advantage in the market must be able to lower the prices. This strategy would
prevent the company from incurring losses due to reduction of sale price to be more
competitive (Shenhar et al., 2016).

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Recommendations in strategies to MAC:
Murasaki has four lessons to learn from Airbus and Being. First, it must be careful
while choosing the mode of project management operations to produce middle range aircrafts
like entering into partnerships with external firms other than the shareholders like Mitsubishi
and Toyota. Second, the management of MCA should maintain strong communications with
the partnership firm(s) and control over the aircraft-manufacturing project. The third lesson
is that Murasaki should not invest excessive amount of capital into operations and
manufacture of aircrafts in the initial stage. The fourth lesson is that the company should
enter the aircraft market with low priced aircrafts. The following recommendations can be
made in the light of these four lessons to Lissane regarding business expansion of Muraki
sans the mistakes of Boeing and Airbus:
Making marketing a part of the project management strategy:
A study of the history of Airbus and Boeing project management procedure and flaws
bears no mention about marketing of the airbuses during their manufacture. Murasaki should
combine marketing with its airplane-manufacturing plan. This will allow the company in
multiple ways. First, marketing the aircraft nationally and internationally would create huge
market which help the company attract customers. As a result, the company can earn more
profit by offering its new products to the clients. Secondly, earning huge revenue would help
the company to distribute its expenditure over this huge body of revenue. As a result, it would
able to lower its sale price and gain economies of scale. These two strategies would help
Mursaki to earn high competitive position in the market.
Continue production of regional jets and international standard aircrafts:
Murasaki should continue production of its traditional product, regional jets and the
international standard aircrafts to compete with Airbus and Boeing simultaneously.
Production and sale of regional jet would generate continuous revenue. The company can

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generate this revenue towards strengthening of manufacture of the international style jet
crafts. Secondly, the company is already in production of jet and has customers in the local
market. This customer base can provide Murasaki with references in international airlines
companies, which can help it to secure orders for Airbus style international aircraft more
easily. As a result, it would be able to charge higher prices for the aircrafts and earn higher
profits. Thus the company can secure high competitive position in the national and
international market.
Expansion into the developed and emerging markets:
Murasaki must expand into both the developed and emerging markets to gain
competitive advantage in the competitive international market. Airbus and Boeing serves
clients from both western markets like British Airways and eastern markets like India and
China. This will enable the airline to gain dominance in both eastern and western markets.

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