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The Boeing 787 'Dreamliner' – A Classic Supply Chain Failure?

When the much-vaunted new Boeing 787 appeared, expectations were high. As the first large commercial airliner built predominantly out of composites, hopes were that it would be stronger, lighter and therefore more fuel efficient to operate than previous aluminium-based designs.

Boeing 787 - 'Dreamliner' unveiled.

The Dreamliner: Impressive at First

Firm orders were initially brisk, and by February 2013 a total of 848 of the marque had been ordered globally. At a minimum unit cost of 200 million dollars, it was looking like a success story. And due to the international nature of the supply chain that leads to the production of the Dreamliner, businesses around the world – from Rolls Royce in the UK to Korean Airlines Aerospace were due to benefit from this success.

But like all companies sourcing parts from around the globe, quality control throughout the supply chain is absolutely crucial: and if you favour price and speed of delivery over quality for any component – particularly in a product as complex and safety-critical as a commercial airliner – you are taking risks that may or may not work out. And in the case of the Dreamliner it is looking increasingly like this risk has not paid off – and may have seriously damaged both the viability if the 787 and, inevitably, of Boeing itself.

Initially, planes were grounded as there were cases of their batteries overheating and catching fire. At the time of writing (Feb 2013) the finger of suspicion as to the cause of this serious battery malfunction is pointing increasingly towards a fault or faults in the electrical control systems rather than in the batteries themselves. Boeing’s CEO Jim McNerney said last week “Nothing that we have learnt has told us that we have made the wrong choice on the battery technology”, the error is most likely to be the fault of subcontractors. Japan’s Transport Ministry have said that safety inspectors have also found no fault with the battery.

It is possible that these faults are inherent in the design of the aircraft or in it’s final assembly, but it is far more likely to be due to components sourced from suppliers failing to fully meet Boeing’s design specifications.

This very relevant example serves to remind all organisations of the increasing importance of correctly managing the supply chain, whether your product is as complex as an airliner or as simple as a mousetrap.

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