Boeing Frontiers
March 2003
Volume 01, Issue 10
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Commercial Airplanes

The supplier factor

Fostering partnership-style relationships with suppliers can create bountiful benefits


The supplier factorEveryone knows you catch more flies with honey than with vinegar. By sweetening its relationships with suppliers through a new partnership-style initiative, Boeing benefits from the experience and knowledge those savvy team members provide.

The Supply Management and Procurement Partnership-Style Relationships Initiative—jointly developed by Boeing and its suppliers—is a new business initiative that promotes teamwork and communication.

The goal of the Partnership-Style Relationships Initiative, said Tom Armijo, director of Commercial Aviation Services Supply Management and Procurement, is to ''develop a new culture of working together by treating each other with respect and dignity during our day-to-day relationship.''

One example is to bring suppliers in at the earliest stage of design. Before the initiative, Boeing provided suppliers with a finished design, including materials, costs, and tooling and process requirements. Since the process often was confrontational, not collaborative, it might have driven up costs because Boeing requirements didn't fit easily into a supplier's engineering and manufacturing processes.

''In the past, Boeing and suppliers dealt with business issues independently ... what was best for Boeing versus what was best for the suppliers,'' explained Jim Hoover, president and CEO of Primus International. ''As a result of the partnership-style relationship approach, there is more working together. There is a clear vision for each—a mutual view of success.''

With the new initiative, suppliers come in much earlier in the game, at the beginning of the design stage. Boeing provides requirements and then asks questions such as, ''Do you have any ideas about the materials we should use?'' Or, ''How would you design it?'' Or, ''How would you build it? How can we make it better and more efficient?''

''We listen to suppliers and get their best ideas,'' said Ben Funston, a member of the supplier management team for New Airplane Programs. ''They can often provide a design/build solution that takes advantage of their existing infrastructure and factories.''

Many Boeing suppliers have aerospace experience outside Boeing and possess a wealth of knowledge that Boeing hasn't tapped into. Exchanging ideas with suppliers can lead to new manufacturing technology, new processes and new materials. Often a supplier already is doing the research and development on a new product that Boeing is interested in, such as a composite.

Allowing suppliers to design and build parts makes it easier and more cost effective for them to implement changes. Boeing ultimately passes along the savings to its customers. If Boeing allows suppliers to do the detailed design of different pieces, it is then free to focus on the architecture and integration of those components, a focus known as large-scale systems integration.

''We will access the best technology from the best providers—internal and external—in the world, using their financial and intellectual resources,'' said Jeff Luckey, director of Enterprise Supplier Management for New Airplane Programs.

Aligning research-and-development projects already has created value with systems and structures suppliers, because there is no duplication of effort, Funston said. ''If a supplier has something in the works that Boeing could use, it saves us time and money,'' he said.

As a result of the partnership-style relationship approach, there is more working together with all suppliers, not just those involved in early design, Hoover said. Hoover is enthusiastic about the changes. ''This is a great beginning,'' he said.

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