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Boeing is the world's principal aerospace company and it happens to be the largest producer of commercial jetliners and the military aircraft. The company has a lot of capabilities in electronic and defense systems, satellites, launch vehicles, missiles, and the advanced information and communication systems. It provides military and commercial airline maintenance services around the world. The company has been the premier producer of commercial jetliners for more than forty years and it was given a seventy-year heritage of leadership in commercial aviation. This essay addresses the Boeing's planning function of management, influence of legal issues, ethics and social responsibility on the management planning and the various factors that influence the company's planning.
As a commercial aircraft organization, Boeing has numerous uncertainties which range from risks to factors that have impacts on the overall success. Among the factors that affect Boeing's tactical operation, strategic and contingency planning are economy, terrorism and globalization. The company has a monopoly in the commercial aircraft market and it rules on the pricing mechanisms and the profit margins. The organization should consider the above factors when making relevant strategies (Moon S. 2010)
Globalization affects the strategies and management in that it increases competitiveness in the aircraft industry. The interaction of the changes in government policies in the airline industry has made globalization faster. The Boeing Company is able to maintain its world markets by becoming global. This is achieved through adapting to different fluctuations in the market demand. During the fluctuations, the company should be able to understand the market situation of the competitors so as to achieve its strategic and tactical success (Besser L. 2002)
The presence of terrorism affects the strategic and management plans in the airline industry. It instills fear in passengers hence they tend to avoid using planes as their means of transport. Also, demand for the airlines will definitely affect the demand for airplanes. Due to the breakout terrorism, many airlines have stopped flights to certain countries such as the Middles East and the main countries involved. Terrorist's actions have made the airline carriers to invest large amounts of money in buying the equipments for use at airports in addition to developing the relevant training programs for their staff in order to ensure that terrorism does not occur at all. The intelligence services must work with those responsible for the nation's security. Also, they must recognize the important role that an airline staff can play in ensuring the safety of the skies. The government should collaborate with the security agencies and airport management to minimize air terrorism (Besser L. 2002)
The economy of a country affects the Boeing organization. The decrease in the new airplane orders can be explained by economic recession. When there is a recession, the demand for the airline travel will very poor and this have an impact on the purchasing power of the airlines. The Boeing Company focuses on target costing and it implemented it as a pilot project and now uses the strategy companywide. The company works with its suppliers to explain the current market pressures on cost based on an economy's performance and works together to find solutions to the challenges it faces. Adoption of a low-cost strategy therefore results in the company's costs being lower than that of its competitors. This leads to the offering a lower price for a product of higher value. Low cost leadership is the commonly used strategy to develop the Boeing Company.
Social responsibility entails organization actions benefiting the society in one way or another. Research and development is an important social responsibility of every airline company. Boeing benefits from the systematic use of industrial research so as to increase the choices of customers each year as well as to provide a safe and effective service to them. The research and is to ensures an effective and safe service for the benefit of the customers. These factors became the ingredients in explaining Boeing's success (Articlespace .2008).
Business owners and managers as private citizens may assume responsibility for other problems in the society, such as the CEO of Boeing providing leadership for the national drive to raise money for medical research to cure leukemia. However, the social responsibility of a worker of an organization could reflect on the entire organization itself (Besser L. 2002)
Successful operations and resolution of the industry-specific problems depends on developing good relations with the government with which the airline is operating under, using joint ventures on long-term presence in the country. This is one legal responsibility of Boeing, to follow country specific impositions on an airline industry by different governments. Foreign organizations had to conduct normal business operations in a politicized environment. The safety of their passengers is also a legal responsibility since this reflects on the capability of the aircraft used. When a plane crashes by accident without any manipulation from outside, for example, it is almost always to be assumed as a legal responsibility of the airline. Most often, the airline involved would pay wall the compensatory damages (Moon S. 2010).
The government can influence the company's strategy by imposing laws and legal restrictions. Business has never been fond of government's having an activist role in establishing ground rules under which it operates, but then organizations do not have any choice. Government regulatory actions can often force the significant changes in the industry practices and strategic approaches. And it is a company's legal responsibility to follow all the government regulations.
The ethical issues also abound the Boeing organization. A basic concept in any system is that the major function of the management of the business units is to maximize the profits for the benefit of the company and its owners. As long as the actions are legal, any decision that might enhance the return of investment would appear to be a better action. An example of an ethical aspect that occurred in Boeing is the laying off of employees as a result of closing down of offices or moving to the new locations (Besser L. 2002)
All the efforts to create a favorable corporate image to Boeing, involves management decisions based on what is right and good rather than what fetches much profit. Corporate giving social institutions, learning institutions such as universities and colleges, the community chests, and support to civic undertakings are one of the important things done by the Boeing organization. People could at least see an overlapping of things that comprises social and ethical responsibilities.