Boeing Case Study

Boeing is the world's leading aerospace company and the largest manufacturer of commercial jetliners and military aircraft combined, with capabilities in rotorcraft, electronic and defense systems, missiles, satellites, launch vehicles and advanced information and communication systems. It is supplying to customers in 145 countries around the world, and also are the number one U.S. exporter in terms of sales. The corporate headquarters are located in Chicago. The company is a publicaly traded corporation that is listed on the Dow Jones Industrial Average. The company comprises a number of divisions, with the major divisions being Boeing Commercial Airplanes and the Integrated Defense System, Boeing Capital corporation, Phantom Works the advanced research and development unit and the Shared Services Group that provides infrastructure services.

The understanding of the legal, ethical and societal responsibility elements of the company is paramount. These factors greatly affect how Boeing management plans and accomplishes the corporate goals. As a large company Boeing is faced with a number of legal issues. One of the largest issues facing the company is anti trust regulations. The company also needs to take into account foreign trade regulations and the attitude towards foreign companies as Boeing is a huge multinational company. The main political risk factors that could jeopardize business operations is a part of external audit. The factors are: Political climate and stability: Here if the political situation is unstable then the environment is unfavorable for the business. Similarly higher Government debt, Budget deficit or surplus is also unfavorable. The other factors are: Tax Laws and other economic laws, Foreign trade regulations, Import tariffs and quotas, Restrictions on international financial flows, Environmental protection laws and Copyright and patent laws

All these have an impact. The more transparency a company has the better it is for the business.

Moreover there is also another threat of European government heavily subsidizing the Airbus which will affect the profitability of the Boeing.

Boeing is in the news a lot and is a huge military contractor as well as a huge civilian company. As such they are under strict scrutiny and must maintain the highest standard of social and enviormental responsibility. This has proven to be difficult in the recent past, however Boeing is quick to take action when it is necessary. There have been charges of unethical conduct on the part of employees of Boeing. For example the resignation of Boeing CEO Philip M. Condit and the termination of CFO Michael M. Sears were due to inflating the price of the contracts to favor future prospective employers and to passing information on the competing Airbus A330 MRTT bid (from EADS). In October 2004 they were sentenced to nine months in jail for corruption, fined $5,000, given three years of supervised release and 150 hours of community service. In March 2005, the Boeing board forced President and CEO Harry Stonecipher to resign due to the behavior “inconsistent with Boeing's Code of Conduct” and that “would impair his ability to lead the company.” Apart from this there has been charges of industrial espionage by its competitors. Boeing and Airbus are also in dispute with each other and the government of America and Europe. At this point, neither organization is admitting they receive assistance from their governments in one way or another, EU member states are contributing to the manufacturing of Airbus new aircraft and Boeing does indeed receive very lucrative defense contracts from the U.S. government.

As a manufacturer of commercial aircraft, Boeing has a responsibility to the public. They have the responsibility of providing safe and secure aircraft for the airline. The airlines have a responsibility to their customers. This responsibility has increased in recent years and now boeing faces the challenge of making their aircraft safer, in particular installing anti-terrorism tools to avert further terrorist attacks. Governments continue to issue new and more rigid regulations that require airports to install certain kinds of technology (Sander, 2004). This issue becomes an even greater challenge as Boeing gets ready to put the Dreamliner into production and Airbus readies the A380 for the market.

Globalization means operating in the world economy as a single economy. Globalization is a requirement now. A convergence of expectations is happening globally. And as barriers fall further, technology advances rapidly, customers talk more to each other on the back of a robust telecom network, the ranks of the Universal Customers will only swell. Thus it will bring good growth for Boeing due