12 Sep 2021

“By restructuring the supply chain, we are eliminating speculative demand and ensuring a continuous supply of raw materials to Boeing`s internal and external suppliers at the lowest possible cost,” said Russ Bunio, vice president and general manager of the Materiel Division of Boeing Commercial Airplane Group. Prakash said: “The students really appreciate the realistic context of the case study. This case provides sufficient facts and data to allow students to quickly grasp the serious threat to Boeing due to the disruption of the supply of raw materials to aluminum and titanium plants. You know how a large global high-tech company like Boeing can be quite vulnerable to the supply and demand of base metals. “Boeing relied on suppliers to supply millions of parts in time and with an acceptable level of quality to assemble aircraft for timely delivery. While only part of it was missing, the planes could not be delivered, making supply chain risk assessment a critical part of Boeing`s strategy.¬†Extract from the case. We must continue to cooperate between Boeing personnel and the supply base. We help ourselves if we do. We must not depend solely on raw material suppliers to mitigate the impact of resource restrictions. There are things we can do internally, and that comes from more collaborative solutions. The strategy will allow Boeing to better forecast aluminum needs, which will help ensure that Boeing and its external suppliers have an adequate supply of aluminum at a reasonable price.

Over the next ten years, the strategy is expected to deliver significant savings across the supply chain. Q: What about Boeing`s raw material suppliers? What kind of conversations do you have with them to make sure they`re ready? Corvi: There are always challenges. One thing to remember is that we can`t look at Boeing in isolation. While we are busy increasing our production rates, Airbus is doing the same. In addition, Embraer builds production and expands its product range. This means that there is an increased demand for unique materials in aeronautics and space across the industry. We must carefully manage our forecasts for parts and raw materials and inform our suppliers of the demand as much as possible in advance. Andrew was faced with a series of questions. How could the company better predict its raw material needs? How could it review its PRA process to better adapt to raw material mills? Could it better limit errors in the ordering, processing and shipping stages of the supply chain? Schaffer: I see it more as another use of the skills we have. Our delivery base becomes an extension of our factories due to the way we integrate our processes.

For example, while contract management is an essential skill at Global Partners, technical roles are becoming increasingly important to us as we manage everything from raw materials to more integrated systems and structures. . . .