Mongcal, Joshua Blaw G. Prof.

Rafael Ireneo
IA-409 PRODMAN
Chapter 15: Case Study (Boeing Co.)

1. Boeing applied JIT practices on different departments that it has.

a. Design the shift from the traditional use of mockup in assessing the
production time to Computer-aided design (CAD) and the automation of such
process has led to a more efficient use of resources such as money and time.
b. Production Process JIT is implemented by scheduling ordering and delivery
or the use of Time-phasing shipments so parts are only delivered as needed in
the production process, thus keeping inventory levels low and would avoid
entailing costs of storing inventories and parts that wouldnt be used
immediately.

Boeings plan to have their suppliers do more pre-delivery work is also

attributed as an application of just-in-time, as this procedure would greatly
save time in the delivery process, compared to having it separately delivered
at the staging area where production process is made. This not only saves time,
but also the costs that it would be incurring in storing products.

2. Reduction in production time provides Boeing with a competitive advantage:

a. Better Supply Chain Management
i. The just-in-time inventory model can also help companies be more
efficient and competitive in the way they handle their supply chains
and use their parts to assemble products for their customers.
ii. A more efficient supply chain can provide lower costs throughout the
manufacturing process, and those lower costs can then be passed on
to the customer. Those lower costs can make the company's products
more affordable, and help the company gain a larger market share
and stay ahead of its competitors.
iii. Supply chain management is a must for a company since it results to
lower costs plus faster production cycle.
b. Better Customer Satisfaction
i. Implementing the just-in-time inventory management model can allow
companies to serve their customers faster and more efficiently.
ii. Entails greater level of control over the entire manufacturing process,
making it easier to respond quickly when the needs of customers
change.
3. Rationale of Boeing in its plan to decrease supplier base may be attributed to the
following factors:
a. More financial visibility, thus significantly reducing all applicable risks.
i. With fewer suppliers to manage, your company can better focus on
securing all applicable risks throughout the supply chain. Your
company can spend more time improving compliance and other legal
policies.
b. Improved supplier relationships
i. Fewer suppliers to manage, the easier it is to focus on building
relationships with core suppliers.
ii. Allows for more time focusing on improving the quality, efficiency, and
overall performance of your core suppliers.
c. Eliminate waste
i. Having lots of different suppliers billing your account means you may
unknowingly be paying for a service you no longer need. Reducing
your supplier base means youll be able to keep better track of any
payments youre making for services which have become redundant
to your business.
d. Easier to manage
i. Less administration and paperwork to take care of leaving you with
more time to focus on other areas of your business.
e. Reduced purchasing and processing costs
i. By consolidating a supplier base, core suppliers will get a larger piece
in the companys market share, equating to lower costs to be incurred.
ii. Overall freight, handling and other related shipping fees will reduce in
cost as well.