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Boeing Company's Goals And Actions

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This paper analyzes the goals and actions of Boeing by analyzing its critical success factors as well as its strategic roadmap.


The Boeing Corporation is one of the largest manufacturers in the world. Rivaled only by European giant Airbus in the aerospace industry, Boeing is a leader in research, design and manufacture of commercial jet airliners, for commercial, industrial and military customers. Despite enjoying immense success in its market and dominating an industry that solely recognizes engineering excellence, it is crucial for Boeing to ensure continued growth through consistent strategy formulation and execution to avoid falling behind in market share to close and coming rivals.

Boeing's goals are twofold: To understand and to take advantage of marketplace changes, and to reduce waste and increase optimal usage of its resources. Boeing's Critical Success Factors are crucial to understanding how the aerospace firm formulates its goals and implements its actions by creating a measure of success. Boeing's plan goals and implementation roadmap will then be outlined and analyzed.

Critical Success Factors

Critical success factors can be used to guide a business in creating and measuring success. A Critical success factor is defined as the identification of a key area where successful performance is required in order for the business to achieve its goals. Identifying critical success factors can help a business identify the tasks and requirements needed for success (Austin, 2002). Development of critical success factors allows a business to measure success and prioritize goals in a way that is meaningful to the business. In "Strategic Thinking: A Four Piece Puzzle", by Bill Birnbaum, he states that it is important to keep the list of key critical success factors to tow or three at the most. Many teams make long lists of ideas on what a company should address in planning which results in the team being unable to focus on a plan. Limiting success factors to two or three helps a company to maintain a focus on the desired outcomes (Birnbaum, 2004).

Critical success factors for the Boeing Company include maintaining a strong financial performance, nurturing a culture of leadership and responsibility, steady defense business and strong growth from developing geographic markets.

Strong Financial Performance

In the last year, earnings per share of Boeing stock rose 42%. Boeing Company revenues rose 5% and their operating cash flow doubled. Excluding special items, the company's core earnings per share rose 16%. The Commercial Airplane division of Boeing set a record with 1,002 net orders for new airplanes. The Defense System business showed a strong financial performance with record revenues, earnings and margins. The growing strength of these two divisions can be seen in the 34% increase in the company's total backlog - to a record $205 billion at the end of the 2005 fiscal year, almost four times the company's total revenues for the year. Boeing was also able to increase their shareholder dividend by 20% (Boeing Annual Report).

Nurturing A Culture of Leadership and Responsibility

Leadership development has been identified as the key to driving sustainable growth and productivity by Boeing leadership. Boeing has developed an internal leadership model that not only defines leadership, but operationalizes it. The model defines a set of attributes that personalizes the behaviors that the Boeing Company expects their leaders and employees to follow. This model is in the process of being implemented into the company's human resource systems and processes. Over a period of the next two years, the company will implement a compensation approach that measures their leaders against both performance goals and leadership attributes. This process will promote growth in Boeing employees (DATAMONITOR). The Boeing Company has also communicated the expectation of performance and values. Boeing leadership have been directed to make ethics and compliance a regular topic of conversation with all employees (Boeing Annual Report).

Steady Defense Business Growth

The Boeing Company's defense business has been growing steadily over the past few years. Revenues from the integrated defense system grew from $27,361 million in 2003 to $30,791 million in 2005. The defense business accounts for over 55% of the company's revenues. Continued strong performance of this division of the Boeing Company would counter any downturn in the commercial aircraft industry (DATAMONITOR).

Strong Growth from Developing Geographic Markets

The Boeing Company has registered strong growth in the developing markets in China, Oceania and Africa (Boeing Frontiers, Nov. 2005). For the fiscal year 2005, revenues from China grew by 87.9%; revenues from Oceania grew by $32; and revenues from Africa grew 61.8% over the 2004 fiscal year. These regions represent some of the fastest growing economies of the world. The Boeing Company's growing market share in these regions would boost the company revenues of the future (DATAMONITOR).

Strategic Analysis and Choice

The main objective of Boeing's strategy is to analyze the commercial aircraft industry, to understand the demand that is present, and to formulate a solution that will fulfill that segment. Currently, there are only two major players in the global market: Boeing and Airbus. Boeing is widely known as the "free market" champion, while Airbus represents the "not-so-free" approach of the European Union's organized and government subsidized competition in so-called strategic markets" (Boeing Corporation's Analysis Paper). Thus, it is necessary that managers review the strategy's execution, make concurrent changes and remain on top of technological advances in order to maximize item usage and increase marketability of its products.

Plan Goals and Implementation

A plan goal for Boeing is to implement a three-point transformation strategy in their commercial airplanes segment by: transforming and simplifying their product offerings; transforming their customer relationships to ensure the requirements and deliverance are met on time; and transforming and streamlining their product systems through the Lean+ process.

Product Offerings

Boeing is focusing its new airplane development efforts


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