The issue of organizational stability in a corporation is of great concern, taking into account the needs and challenges of contemporary world. The technological progress seems to draw to a head in the twenty-first century. This is why the question of reliable and fast-adopted and publicly adequately met innovations plays a great role for companies competing in different fields of activity. In case of Boeing Company it is vital to mention that this well-known corporation is successful in producing of plane for carriage of passengers all around the world. Furthermore, its authority is supported by the positive feedbacks of its clients and passenger as well. Nonetheless, inside a company there were different problems which were considered with organizational and relationship contradictions and problems with leadership. It appeared to be so in the beginning of the twenty-first century, the time when the closest rivals of the company such as Airbus were successful in implementation of new models of planes.
In this respect the paper is aimed to evaluate the situation happened to the Boeing Corporation regarding to the case study illustrating the main peculiarities during the process of organizational change in it. The main goal is to identify the reasons and the effects of such change in the company. The appropriate tools and models are focused on the optimal theoretical methods while analyzing the actions of the company’s administration in practice. The paper is united in all facts concerning the situation with Boeing and has evidential base for making strong arguments as of the actions of the top management according to the resolving of the internal problems. Limitations are reckoned with the inability of the company to provide further predictions for Boeing’s actions due to the shakiness of the world economy and instability of managerial design with the flow of time. In other words, every new generation of enthusiasts provides new conceptions and plans for development of a company. Nevertheless, such limitation concerns the long run, in particular. A gradual analysis of advantages and limitations provided by the senior management team is at a core of the discussion.
Looking at the major companies of the world in terms of their capacity to react on the changes maintained in the world, one may definitely point out that the winners are those who reflect the demands of the market in time. In this respect there should be a well-structured and perspective body of the company with leaders at its top. Leadership and relationship decline was the main problem for Boeing in the end of the twentieth century. The main reason is a diminished significance of knowledge and collaboration management throughout the company. As Laudon and Laudon (2009) outline, the ability of the company to actively implement the innovative technologies along with the productive personnel promotes high readings in sails and cooperation with partners and customers.
One of the limitations of the company in comparison with its rival Airbus was a delay of the launch of a new model 7E7. It was concerned with the need to change the place for headquarters of the company from Seattle to Chicago which was done later. Observing this event, Popular Science (2004, p. 96) published the article by Bill Sweetman in which the appearance of a new ultra-modern plane was discussed: “Boeing’s best hope for survival as an aviation giant sits in a small warehouse in a Seattle industrial park”. “Dreamliner”, as it was called, was a hope fore the company with far reaching perspectives for further use and matching to technological and economical demands of the time.
Continuing the idea of relocation, it is necessary to admit that such organizational change affected the morality of the personnel and provided the breakdown of Seattle relations within most of the employees. This was one of the main problematic situations within Boeing Company. Another one concerning changes in the top management team which presupposed a poorly solid work of the senior management. As Smith (2002) outlines, yet senior management in their ambitions for leadership in the company do not even think of inheriting or sharing such leadership skills which may be implemented in the communication or social systems. In this respect Boeing suffered from changes in the staff peculiarities. Popular Science (2004) informs that at that moment there was a line of dismissals in the company, especially concerning the quit of chief financial officer Mike Sears, then went a replacement of CEO Phil Condit with Harry Stonecipher. Moreover, this change was aimed also at the transformation and reformation of the traditions pointing out more efforts on competitiveness and productivity, than on a mere money-making. With regards to Bass and Riggio (2006) transformational leadership is significant for the process of strategic changes and urgency for effective implementation of the new company’s internal design. Thus, the authors fairly notice that “the relationship between transformational leadership and leadership outcomes is complex” (27). Another approach where the company had a weak point was considered with the policy of diversification, which promoted several main goals for the company which predetermined a decrease of financial resources for the panned launch of the Dreamliner 7E7.
Kotter’s model is appropriate for resolving of such processes of change provision. Moreover, this model has its aim to straightforwardly point out the main steps in making organizational change effective and without any weighty offence of omission. In particular, as Leonard and Mcguire (2007, p. 50) are inclined to mention, the model is based on the four main points for promotion of changes in corporations, namely:
- Establish a sense of urgency;
- Create a powerful and competitive group of leaders heading the main structural parts of the company;
- Elaborate the strategic vision of the company;
- Use communication to implement further vision of the change.
In fact, this model reflects the deeds of the Boeing’s administration while promoting first steps on the way for changes. As it is known, the results of the work may be considered according to the “fruits” which are the outcomes of the work to be done. In this respect Lockwood, Thomas Walton (2008, p. 175) prove the achievements and improvements of Boeing’s top personnel in resolving of two major constituents of the market in the field of aircraft, namely: “fuel efficiency and low operating costs”.
Among other models, such as Jick’s ten-step model and General Electric’s seven-step model (Rothwell & Sullivan, 2005), Kotter’s one is proper for maintenance provided in Boeing internal relationships. Regarding to Sabri et al (2006) the matter of leadership and relationships in a company during the period of strategic and global changes for it the above mentioned four points are supplemented by the following approaches, namely:
- Making the employees aware of their participation and direct actions;
- Working out of the short-run priorities;
- Consolidation of what is achieved so far;
- Promotion of new changes in the culture.
It is not for nothing that the “skeleton” of the company should be built on the basis of strong relationships and communication in all its types. For this reason Boeing was hasty in terms of the implementation of new social systems, because relocation promised that the links with Seattle for the majority of the staff would be severed. In this respect the Weisbord model presupposes the three directions in which such correlation inside the company can be provided. Among them are: the relations between dominants and subordinates and people-peers relations; the relations between different structural parts of the company; and the relations between employees and technologies for their work (Weisbord, 2004). The experts know this approach to the organizational change as the six-box model. The thing is that leadership according to Weisbord’s model is placed in the center of five different components, which, stating the remarks of Anderson (2009, p. 72), are:
- Helpful mechanisms;
The scandalous situation, which paid attention of the Pentagon and analytics as of the manufacturing crisis and decline of stock price being diminished by 6.5% in time of Condit’s ineffective leadership initiatives, improved as a new administration rolled around and implemented the use of new technological platform. For contemporary companies the theme of high technologies is assimilated with last updated information systems, so that to stay in touch with all departments and employees throughout a corporation. This, in fact, should be implemented and used in Boeing immediately along with major organizational change. It is so, because, as Gottschalk (2005) notes, an IT strategy should prop up against the right selection of hardware, software, and networks, as main units of technological platform.
Conclusion and Recommendations
The problematic situation in the Boeing Company in the year 2003 was a great challenge for the body of its personnel and the further development of actions for the administration. In fact, it drove to the line of dismissals and the crisis in manufacturing due to a decrease in production of planes in comparison with the closest company’s rival, meaning Airbus. The point is that the problem was covered in internal relationships and proved the inability of the highest echelons of the administration to provide changes in order to improve the situation and to save previous top positions. The two models are supposed to help in such situations due to their efficiency in making organizational change.
Kotter’s and Weisbord’s models seem to be easy in their structural peculiarities, but still such processes as working out the main urgency and consolidate powers over the drive of the senior management team, so that to encourage the rest of the personnel in terms of readiness and participation in organizational change for the well-being of the company, is rather long and needs more efforts. Moreover, such approach is rather helpful for the Boeing Company, because when Phil Candit was replaced by Harry Stonecipher and the headquarters of the company was relocated to Chicago only a strong and well-structured gradual flow of actions could save the time and reputation for Boeing. It was better for the Boeing administration to look at the suchlike transformation in other corporations, probably of the same field of activities.
The representation on the following case study promotes the positive and negative impacts of the Boeing top management after 2003. Moreover, the primordial announcement of Stonecipher about the fact that a lot of time is the only fundamental (Sweetman, 2004) helped the company not only to accommodate and get accustomed with new conditions for work, but also to improve the volumes of production. In fact, in this approach Boeing was in advance in contrast with Airbase. The way of the organizational change in the company from the very beginning to the further effects is reflected on the representational slides and charts concerned with then and today’s statistical data of the company’s growth and the use of the project 7E7 for the next twenty years (Lockwood & Walton, 2008).
Possible changes in the group design of presentation may touch upon the approaches to similar situations and provision of familiar circumstantial background in other large companies all around the world, so that to drive off their experience. In this respect the situation with General Motors and its subsidiaries in more than 35 countries may be represented as an example. One more touch, as for me, should consider the division of roles between the participants of the presentation with more points of speaking about the critical evaluation of the problem without simply stating facts. The speech while presenting information should be plain and comprehensive with sequential additions of all participants concentrating attention on different parts of discussion according to the issue. Such procedure may help to better conclude the reasons and effects of organizational change prospects related to the example with Boeing and its efforts on the pathway to success.
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