Supply Chain Managment Boeing

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Question 2 In 2007 and 2008 Boeing ran into several well publicized issues with regard to its management of a globally dispersed supply chain. What are the causes of these problems? What can a company like Boeing do to make sure such problems do not occur in the future? The root cause of the problem was supply management and Boeings lack of an appropriate inventory management system. A secondary problem with the system was a capacity issue. This was also exacerbated by the lack of an inventory management system. Boeing did not have a thorough grasp of the scope of their supply chain. This led to misalignments in the values of their supply chain partners. With a decentralized production strategy Boeing opens itself up to static in communication between its partners. This lack of communication led to the majority of problems with its inventory management. The lack of capacity was evidenced by the outsourcing of parts to the Israeli firm. A better level of communication between Boeing and the Canadian firm that outsourced to Israel would have been able to prevent the quality issue. Boeings quick work to get engineers to the Israeli company was a great thing to do. It allowed for the problem to be fixed. It also built on the theory of reciprocity. Since Boeing was willing to bring its engineers in to help the Israelis, it built a sense of gratitude and a desire to repay the help that they were provided with. The best way to solve a series of problems of this nature would be to introduce a system wide Electronic Data Interchange between all of the subcontractors involved in the supply chain. This system would allow for direct communication between Boeing and all of its sub-contractors. This would allow for a more flexible and responsive supply chain. This would also decentralize management to a factory level and allow the manager at that level to coordinate

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