Boeing's Planning Process Is Usually Research Paper

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These different factors play a role in setting long-run strategy at Boeing, such as product development and decisions regarding manufacturing capacity. The company must also make human resources decisions based on expected demand, and the period of planning can stretch 5-10 years or more.

Tactical planning can also be a long-term process at Boeing. This is impacted by competition within the defense industry, the expectations for DoD budgets and the state of the economy. These types of decisions will reflect the specific products that Boeing develops and to whom those products will be marketed. Operational planning is impacted by the firm's internal financial situation, the availability of key human resources and by the current state of relations with states around the world. Boeing needs to make decisions, for example, about the sourcing of inputs. If the relationship with China is on the rocks, for example, Boeing needs to seek out other potential suppliers of inputs in order to produce its goods.

Contingency planning is a critical component of planning at Boeing. The company invests tremendous sums of money in product development, and sometimes must do this with no guarantee of orders from the project's apparent patrons.

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Thus, Boeing must have plans in place to recoup investment costs if deals are delayed or scuttled. Three factors that will impact contingency planning at Boeing are relationships with clients, sunk costs and the ability to shift emphasis to other projects. These factors relate to the ability of Boeing to convert heavy research and development costs and high infrastructure fixed costs into revenue and profit. Boeing realizes the risks it takes when spending hundreds of millions of dollars on product development and this guides the contingency planning within the organization.

The planning process at Boeing is critical to the company's success because of the high cost of product development and the long time frames. Boeing must therefore eliminate the risks associated with planning by fostering strong relationships with its customers through the product development process, and by implementing contingency plans that will allow the company to recoup sunk costs in the event that expected sales fail to materialize.

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