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Manufacturing Strategies
Case Study
1. A robust U.S. economy is good for most airline carriers, 0.08 4 0.32
which are Boeing’s primary customers.
Threads
1. The forging houses that process the titanium are booked 0.08 3 0.24
until mid-1998. Delays in this forged material created a
bottleneck for production and delays of aircraft deliveries.
2. Boeing is one of the largest U.S. exporters with over $ 10 0.08 4 0.32
billion in sales to foreign countries.
6. In 1996 the number of orders of jet crafts is two times 0.08 4 0.32
bigger than in 1995.
Weaknesses
4. Boeing’s military sales are driven by external threads and 0.04 2 0.08
politics.
Current ratio
Leverage ratios
Debt-to-equity ratio
Times-interest-earned ratio
Activity ratios
Total-assets turnover
Fixed-assets turnover
Profitability ratios
Growth ratios
Sales
Net income
SO Strategies
1. Increase international aircraft exports 10% annually. (O2, O3, O6, S1, S2)
4. Create a merger with another defense and space company for a successful
cooperation in the field of military and defense. (O7, O8, S9, S10)
WO Strategies
ST Strategies
1. Introduce present products or services into new geographic areas (S1, S2, S9,
T3, T4)
Return on investment 5
Leverage 2
Liquidity 4
Working capital 5
Cash flow 5
Market share -1
Product quality -1
Customer loyalty -2
Technological know-how -2
Technological changes -1
Rate of inflation -2
Demand variability -2
Competitive pressure -3
Growth potential 6
Profit potential 5
Financial stability 4
Technological know-how 4
Resource utilization 4
Capital intensity 4
Conclusion:
Thus, the best strategy is the aggressive strategies For the Boeing Company it could
include increasing international aircraft export and introducing present products and
services into new geographic areas.
IV V VI
VII VII IX
Since IFE total weighted score is equal to 3.49 and EFE total weighted score is equal
to 3.06 it follows that the Boeing Company belongs to the first quadrant (build and
grow strategy).
Since the Boeing Company strategy is connected with market development, product
development, concentric diversification and horizontal integration (both merger and
acquisition), it belongs to the first quadrant. It means that the company is describes
by rapid market growth and strong competitive position and this is the best possible
situation.
9. Developing Quantitative Strategic Planning Matrix for the Boeing
Company.
Strategy 1:
Strategy 2:
Strategy 1 Strategy 2
1. A robust U.S. economy is good for most airline 0.08 4 0.32 3 0.24
carriers, which are Boeing’s primary customers.
4. In 1996, airline demand for new aircraft rose. 0.06 4 0.24 3 0.18
7. U.S. defense and space spending are expected 0.06 2 0.12 1 0.06
to remain steady at $ 90 billion for the next 5 years.
Threads
1. The forging houses that process the titanium are 0.08 3 0.24 2 0.16
booked until mid-1998. Delays in this forged
material created a bottleneck for production and
delays of aircraft deliveries.
Strategy 1 Strategy 2
2. Boeing is one of the largest U.S. exporters with 0.08 2 0.16 4 0.32
over $ 10 billion in sales to foreign countries.
6. In 1996 the number of orders of jet crafts is two 0.08 2 0.16 3 0.24
times bigger than in 1995.
Weaknesses
Conclusion:
One can observe that the profit of the Boeing Company fell to negative $ 178 million,
after rising dramatically in 1996.