Global Operations

There are very few companies that are known in the world for their global approach to business. The Boeing Company is one of the very few good examples of a global company. Its founder is William Boeing. It is majorly an aerospace and defense corporation.  Its corporate headquarters is currently in Chicago, Illinois, but it has opened many branches around the world in its pursuit to achieve globalization. Boeing comprises of various business units: Boeing Commercial Airplanes, Boeing Capital, Boeing Defense, Space and Security, Engineering Operations and Technology and Boeing Shared Services Group. Being the largest exporter by value in the US, Boeing is also the biggest global aircraft manufacturer (Wagner, 2001).

The launch of 787 has made Boeing receive a lot of contracts lately. The 787 Dreamliner has made Boeing outsell Airbus A350, its main rival. The two new models: the Freighter model and the Intercontinental model have features such as a lengthened fuselage, new advanced engines and wings, and they incorporate other technologies that were developed for the 787 aircraft. The 737-800 is the latest model and is capable of flying more passengers because of its two extra emergency exits. Gonzalez (2009) asserts that the Boeing Company is also thinking of future concepts. It aims at producing planes that cost lowly and are environment friendly. It has also come up with hybrid electric engine technology so as to shorten the distance for takeoff and reduce the amount of noise from the engines.

According to Greider (1997), the theory of comparative advantage is the idea which demands that you become the best at what you do. Boeing has made tremendous steps in the investment of its financial and human capital, and in research of new products and production processes. One example of a comparative advantage which the US can boast of is its large commercial aircraft. This advantage was primarily utilized during World War II when their European competitors did not build and use many bombers in the war. Ever since, Boeing has tried a lot to invest enough so as to achieve its own comparative advantage. The increase in the strength of the dollar continues to make aircraft manufacturing in Europe to be more expensive. However, the war events of the recent years have generated an anti-US feeling amongst other nations. This has impacted negatively on the sales of Boeing.

There are a number of political factors that affect the Boeing Company. For instance, policy and regulatory decisions by the U.S government officials are very influential in the business of Boeing. Consequently, this impacts on the demand for civil transport aircraft within and abroad. For example, Boeing has a good market share in countries that have good political connections with the United States. The regulations provided by the United States and the European Union governments go a long way in determining the number of orders for aircrafts or engines demanded by customers. Since the deregulation of European airlines, there has been an expanded market for smaller regional jets. The General Agreement on Tariffs and Trade has also enabled trade in large commercial jetliners to be tariff free. Besides, interventions by high level politicians have also impacted on the sale of aircraft. Support or interference of governments usually affects buyers in other countries. For instance, China is a huge market for Boeing due to political connections with the United States (Gates, 2006).

Economically, Boeing and other aircraft manufacturers heavily rely on subsidies so as to be cost effective. There have been claims that Boeing has been receiving unfair subsidies of late. This however depends on respective governments. Other economic factors affecting the manufacture of aircrafts by the Boeing Company include: increased fuel costs, environmental restrictions, security concerns, and insurance cost. A combination of these factors, if not properly checked, might finally translate to very big losses for this company. Some aircraft prices are down by 20 % due to the fact that global tourism has been in recession for quite some time. Gonzalez (2009) asserts that future success in Boeing calls for urgent redress of these economic issues. Nevertheless, new partnerships between the US and other countries like Japan and Russia has gone a long way in boosting future prospects of good business for Boeing.

Boeing has used newest technology to its advantage in coming up with new innovations. In particular, new technological advances have helped the Boeing Company to utilize its resources. For instance, it has employed the use of robots in the creation of various planes. Boeing has also ventured into supersonic transport. Apart from supersonic aircrafts being very fast, they make commercial careers get faster to their destinations, hence satisfying customers need for speed. The use of Robots in manufacturing has also enabled Boeing to increase the speed at which it designs its planes. Consequently, this has enabled Boeing to cut its costs on labor and to save on resources. The Boeing 777, a new model, has been built using computer technology in building a prototype (Wagner, 2001). This has gone a long way in helping to cut costs. Boeing has also ventured into using lighter materials for manufacturing, and this helps it in the management of its resources. Most of the aircrafts nowadays are made of composite and synthetic material.

Indeed, Boeing is a vital company to the U.S both economically and politically. It has enabled the United States to become a leader in the aviation industry and in exports. Consequently, this has enabled the US to export geopolitical bargain of power. Boeing has acted positively in the economic aspect on many segments of the US industry. It is also the largest exporting manufacturer of the civil aviation in the US and the world at large. It is among the topmost recognizable brands within this globalization times. It is capable of meeting the military needs of the United States across various product lines. Despite the fact that it mainly operates in the US, Boeing also operates in countries such as Japan, Australia, Spain, Germany, India, France, Russia and the UK.  By the year 2009, Boeing had its revenues at around $69 B. The annual earnings on the other hand were around $1.87 per share (Gonzalez, 2009).

According to Greider (1997), globalization is the process by which regional economies, cultures and societies can be integrated through a global network of communication, trade and transportation. It is the growth of business on a global scale. Economic globalization is the integration of national into the international economy through various channels such as migration, technology, capital flows, trade and foreign direct investment. It is driven by economic, political, biological, and technological factors. Globalization has impacted on Boeing in a great manner: global alliances have also made it to continue being competitive. Most of Boeing commercial models are being supplied by foreign contractors. An example is the Boeing's dreamliner which was designed for production by a global chain. Boeing depends on about 15% for parts from abroad.

These are hard times in making a plane without the much needed global supply network (Wagner, 2001). Companies like Boeing are on the forefront in the search for up to date and most efficient technologies. Boeing had to seek the expertise of Japan's Toray Industries for light carbon-fiber composites so that they can build their Dreamliner. The Dreamliner takes up a large amount of space to be built. Boeing found it necessary to spread this work around the world. It also produces parts of the plane at the same time to save up on time and energy. So because Boeing gets orders from foreign careers, they outsource work to other countries. On the other hand, global supply can become a nightmare when deliveries of aircraft are delayed.

Boeing's main competitor is the Airbus which is based in Europe. They are the largest defense contractors in Europe. It is very busy trying to be a defense work leader in the world. The competition between them is so intense that each of the company tries to outrun the other. They always accuse each other of receiving unfair assistance from their respective governments. Airbus is an aircraft manufacturer which is a subsidiary of EADS, based in France. It produces nearly half of the world's jet airliners. It is known for the production and marketing of the first commercially and viable fly-by-wire airliner apart from the largest, the A38.

Boeing has many qualities that make it a global company. It has always aimed to give the world the most efficient aircrafts for its future needs. It has continually faced the challenges of a global economy but survived through. It will continue to command its share in the aviation sector in the world.