Boeing Software Procurement Case Study

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Case Study Questions A) Why would a large and complex company like Boeing employ off-the-shelf application-specific software for accounting, human resources, supply chain management and other core business processes? [list] B) And why do they choose to host and operate all of their own software rather than to for example outsource payroll to ADP Corporation or sales force management to [list] Employing off-the-shelf software for certain business departments makes sense in Boeing’s case because these are horizontal, or cross-industry applications. The use of Adobe, Microsoft Office, Internet Explorer, and AutoCAD does not put a company at any kind of disadvantage, and similar software offers little, if any, competitive advantage. Off-the-shelf software is cheaper than developing custom software. Conversely, due to Boeing’s massive scope and size, outsourcing certain elements would be inefficient. Outsourcing payroll or sales force management with 158,000 employees in 70 countries would be an extremely difficult, let alone expensive, task. Processes like payroll and sales force management often require much human interaction in order to work properly, so outsourcing these elements could create major roadblocks for employees and employers alike. On the other hand, why would Boeing develop in-house some of the software applications used in conjunction with its products? [list] While some applications are cross-industry, others are within an industry (vertical), meaning that they do provide a competitive advantage. While word-processing and accounting tools may be interchangeable, specialized software has the potential to offer massive benefits and advantages. Engineers’ software, for example, could well be worth the investment to develop in order to ensure a better quality of output in their products. Boeing

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