Boeing is the largest aerospace company and the largest manufactor of commercial and military aircraft in the world. Boeings military aircraft come equipped with missiles, satellite, launch vehicles and advanced information and communication systems. Boeing is the number one U.S. exporter when it comes to sales. Boeing
’s management must understand the importance of the legal, ethical and social responsibility of their organizations. All of the above mentioned will have an effect on the planning function of management.
Some of the legal regulations Boeing encounters are antitrust regulations and foreign trade regulations. The government can influence a company’s strategy by the laws the government imposes. A company has a legal responsibility to follow all government regulations
. Boeing will also have to pay attention
to environmental laws and copyright and patent laws. Boeing must also pay attention to impositions that other countries may put on the airline industry. Boeing must respond appropriately to other countries political and economic environment. The biggest legal responsibility Boeing faces is the safety of their passengers. When an airplane crashes without being manipulated by outside factors it is always the responsibility of the airline. The airline will be responsible for paying out any compensatory damages to the surviving family members.
Social responsibility is an individual or group’s actions benefiting the society as a whole more than oneself or the group. Boeing uses research and development as a way to increase customer’s choices every year as well as providing a safe and effective service for their customers. Boeing is currently developing a new 787 Dreamliner jet. Some of the features of this new jet include a new interior environment that will have a lower altitude and higher humidity making the customers more comfortable during long flights (Troy 2005). Boeing understands that the purpose of using research and development is more than just a way to raise profits they see it as a way to benefit the customer. This is one the reasons Boeing is one of the world’s top airline companies. Boeing is also a member of the foundation for Corporate and Social responsibilty and encourages other companies to get involved in supporting ethics in business.
Boeing has had its problems when it comes to ethics. Lawmakers question Boeing’s ethical commitments. (Mandel,2006) This on the heels of two separate charges involving Boeing. Boeing is being charged with improper possession of documents belonging to competitor Lockhead Martin Corp. The documents were most likely used to win a contract for government rocket launches. Boeing has since put into place an extensive ethics policy which was developed to protect the corporation and its employees. It requires all employees to follow the conduct set forth in the Boeing Code of Conduct. Boeing has also set up a hotline for employees to ask questions and report questionable behavior. These efforts are intended to create a favorable corporate image for Boeing. Management must make decisions based on what is right and wrong not what is going to be profitable if it wishes to be viewed as a company with high ethical standards. In essence Boeing’s actions must match up with its ethics policies.
The aircraft industry has many factors that contain risks and could affect its overall success. In today’s world the three main factors are economy, globalization and terrorism. All these factors could affect Boeings strategic, tactical and contingency planning.
The economy of a country is a huge factor for aircraft manufacturers. When an economy is on the downturn or appears to be heading toward a recession the demand for airline travel goes down. The order for new airplanes also goes down when the economy goes down. Boeing has had to look to other countries for business and focusing on more military projects.
The threat of terrorism has affected the strategic and management plans in the airline industry. Terrorist attacks are unpredictable and it makes passengers not want to fly and this affects the airline industry’s profits. Since 9/11 many airlines have stopped their flights to certain countries such as the Middle East for fear of hijacking. Terrorism in the air can be minimized but it requires the combined efforts of government and their security agencies together with the airline companies and management.
Globalization makes the airline industry more competitive. People all over the planet know Boeing in much the same way as they know Coca-Cola or Nike. (Beck,2008). Name recognition is not enough to make a company global. Today being Global is being recognized as a local part of the culture and communities and regions where it does business. Boeing is working on its globalization strategy by creating new partnerships, joint ventures, mergers and acquisitions and supplier relationships. One way Boeing is going about this is to have executives in overseas offices. They are hiring individuals that are knowledgeable about local culture and language to head up these offices. The executive will help Boeing develop partnerships and address governmental issues that affect Boeing. They will also advise when it comes to the advertising and marketing campaigns for the countries they are doing business with. Globalization increases the pool of talented resources available to companies looking to go global. Globalization also gives a different perspective on the world and realization that the world is full of potential customers and technology opportunities companies need to stay profitable in today’s world.
Boeing’s planning includes many factors ranging from legal issues, government regulations, corporate responsibility, ethics and economic factors. Boeing has legal departments to handle both external and internal legal problems as well as help in the planning process. Corporate social responsibility is important because some consumers will judge an organization based on what efforts they put forward in this area. Despite some problems that Boeing has had in regard to ethics they still maintain a strong code of ethics that has helped Boeing stay around in this very competitive field. Current economic conditions affect all areas of planning within Boeing and they are constantly adjusting the planning to meet the circumstances of the changing external and internal factors.
Boeing. (2008, February). Retrieved February 29, 2008, from Foundation for Corporate Social Responsibility.
Boeing Frontiers.(2008,October)Going Global, How Boeing is changing the way it works around the world by Katherine Beck, Paul Proctor, Tom Downey and Junu Kim
Troy(2005)Lighting Research Center partners with Boeing to develop aircraft lighting solutions