The case is about the 787 Dreamliner, an airplane developed by the US based

airplane manufacturer, Boeing Airplane Company (Boeing). The case examines

the reasons that prompted Boeing to initiate the 787 project. It highlights the
making of the aircraft, which was expected to change the dynamics of the world
aviation industry. The case also highlights the distinguishing features of the
aircraft and explains how it is more advanced than the existing aircraft. Various
supply chain related issues are discussed in the case. The case also talks about
the post-launch problems faced by the 787 Dreamliner and its repercussions.
While some analysts were of the view that those problems were part of initial
hiccups, some industry experts opined that Boeing’s aggressive outsourcing was
responsible for them.
Issuess

The case is structured to achieve the following teaching objectives:

 Understand the importance of innovation in the aerospace industry and how Boeing managed
the supply chain to come up with a product that was hailed as a major innovation;
 Discuss the reasons for the post launch problems faced by the 787 Dreamliner;
 Analyze the pros and cons of outsourcing in aviation;
 Discuss and debate whether the 787 Dreamliner can be considered an innovation in light of the
problems it was facing.
 Explore ways in which Boeing could salvage the situation.

On November 10, 2013, a 787 Dreamliner flight operated by Japan Airlines

developed a problem with its battery – the latest in a spate of problems plaguing
Boeing’s 787 aircraft. A cockpit indicator in the aircraft pointed to a problem with
the battery connected to the aircraft’s auxiliary power unit. The 787 Dreamliner
was developed by leading airplane manufacturer, the US-based Boeing Airplane
Company (Boeing). The 787 Dreamliner was Boeing’s modern jet in which the
aircraft manufacturer used new technology to cut the cost of fuel used for
operating the plane by 20%. To reduce weight and improve fuel efficiency, the
aircraft manufacturer used carbon-fiber materials and electronic systems with
more powerful generators and higher-energy lithium-ion batteries. 

Boeing’s 787 Dreamliner was expected to be a game-changer for the commercial

airplane industry. With its use of lighter materials and new construction methods, it
promised huge savings in fuel as well as maintenance costs. “Airlines will love it
for its economics, passengers will love it for its ability to get them point-to-point in
greater comfort, and the world will love it because it’ll be environmentally friendly,
like no other airplane in the sky,” said Mike Bair, Senior Vice President of the 787
Dreamliner program.....
The airplane, which was expected to revolutionize commercial aviation, was welcomed by the
market with huge orders. However, ever since its development, the aircraft was plagued with
troubles. Boeing had crossed its budget of developing 787 Dreamliner aircraft and was more
than three years behind schedule in delivering it. Moreover, since January 2013, a series of
technical problems had triggered international regulatory scrutiny of the jet. In the middle of
January 2013, the entire 787 fleet around the world was grounded for three months. The
company assured various airlines that it would address the problems and would assist them to
resolve it. “We have complete confidence in the 787 and vow to take care of any issues our
customers are experiencing,” said Randy Tinseth (Tinseth), Chief of Marketing at Boeing. .... 
About Boeing

The history of Boeing dates back to 1916, when William Boeing (William) and
George Westervelt (Westervelt) formed the Pacific Aero Products Company. The
or
company was renamed as Boeing the next year. In the initial years, Boeing used
to manufacture aircraft for the US military. In 1922, Edgar Scott became the
company’s president. During his tenure, the US navy gave Boeing the contract to or
build a primary trainer (plane for test flights). In 1927, Boeing’s Model 40A was PayPal (9 USD) 
selected by the US Post Office to deliver mail between San Francisco and
Chicago. To run the airmail service, Boeing Air Transport (BAT) was formed. BAT
 
also used to train pilots, set up airfields, and provide maintenance staff.
After World War II, Boeing shifted its focus from the defence industry to
commercial jets, as the company realized that to speed up the company’s growth,
it had to design, mass produce, and sell its own aircraft. In 1952, it launched its
first commercial jet, the Boeing 707, a short range aircraft.
 

In 1960, Boeing started manufacturing its first Jumbo Jet – the Boeing 747, which went on to
become one of the company’s most successful aircraft. In 1962, Boeing manufactured the Air
Force One, the official airplane of the US President. In late 1969, Boeing entered the field of
spacecraft manufacturing by contributing to the Apollo program. In 1970, after Airbus Industrie
was formed, Boeing’s market share started to decline. The recession in the 1970s also badly
affected the company.
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