Research on the over-outsourcing in aviation manufacturing industry— Case analysis based on the boeing 787

Abstract

In recent years, outsourcing has become a major trend with more and more companies contracting work out to 3rd parties. The aircraft giant-Boeing company，also regards outsourcing as an important way of its production process. In 2003, under the influence of Toyota production system(TPS),Boeing adopted a new manufacturing model to produce the airplane-Boeing 787 Dreamliner. It outsourced more than 70% of the development and production of its aircraft under a 3-Tier system.However, the excess outsourcing has caused lots of problems such as communication issues, lengthy delays and unexpected increased costs. Starting from the practice of Boeing 787 project's global supply chain strategy, this paper analyzes the reasons as well as problems faced by Boeing for outsourcing such a big project, and draw some lessons on how to strengthen the management from the failure of Boeing 787’s early outsourcing stage.