Yesterday, I took a tour of the Boeing Company manufacturing operation in Everett, Washington. Boeing has been an interest of mine for years and was the subject of three of my case studies. Since I happened to be in the neighborhood, I leaped at the chance. This tour ranks as one of the top business attractions in the world, one of the top five “must see” plant tours anywhere. It is open to the public; tickets can be booked online in advance. The appeal of the visit owes to the enormity of operation combined with the sheer complexity of the product. We saw in production the 747, 767, 777, and the new 787. As the American economy grows more dominated by service operations, it is instructive and valuable to visit a manufacturing operation. Boeing is the leading exporter in the United States. The tour is remarkable in all ways.

One detail stands out. We learned that it takes four months to assemble a 777. But Boeing expects to take only six days to assemble the new 787. This remarkable shortening of the production cycle time owes to a range of advancements in manufacturing practice:

  • Large-scale systems integration. Boeing relies on suppliers to build more complex components of the aircraft, which means that the company emphasizes the effective integration of major part of the aircraft system, such as fuselage, wings, and propulsion systems. Partners (both customers and suppliers) need to interrelate in the design of the aircraft. Such interrelation in enabled by virtual computer-based design.
  • Relational design. Three-dimensional computer aided design affords the opportunity for suppliers to test the fit and finish of their parts without having to resort to physical trial-and-error.
  • Product lifecycle management—this aims to shorten product development cycle times and reduce development costs. Using information about the product development process, managers can monitor and improve the cycle across all of its stages: conceptualization, design, manufacturing, and support. Now, the product allows for parties at every step of the way to take an enterprise point of view in the optimization of the total activity. For example the 777 requires Boeing to assemble thousands of components; the 787 requires the assembly of under 100.
  • Lean manufacturing. Boeing has learned from Toyota and others that efficiency requires the engagement of suppliers in the design and delivery of components. One sees very little spare inventory on the floor of the manufacturing plans—inventory is delivered on a just-in-time basis from suppliers. This looks like a lean operation.
  • “Factory of the future.” The Boeing plant includes daycare centers for the children of employees, health and wellness centers, gyms and workout areas, and “employee service centers” that in layman’s terms amount to concierge desks that handle your dry cleaning, DVD rentals, massage services, beauty appointments, and so on. When you’re competing to recruit and retain top engineers and skilled workers, Boeing offers lifestyle enhancements in addition to the usual terms of employment.

The ingenuity one observes in a visit to a plant like Boeing’s is a reminder that process excellence is a vital driver of high performance. This is a message that we emphasize in our courses at Darden. It is not sufficient to deliver a quality product; it takes quality processes to generate a sustainable competitive advantage.

Posted by Robert Bruner at 08/17/2007 01:24:56 AM