Question

In regards to Boeing business and supply chain strategy:

1. What type of product is the 787 and did the sourcing strategy fit?

was the Boeing 787 a innovative, hybrid, or functional product?

Functional products, which are generally low margin but stable demand likely have sourcing strategies based on stable supply at the lowest cost.

Innovative products, which are generally high margin, complex, and may have short life cycles and variable demand would have sourcing strategies based on quality, speed, and flexibility.

Answer 1

In my opinion, Boeing 787 is a functional product since it is used in a lot of airlines for passenger air travel. Even though the margin of Boeing 787 is low, but due to a large number of orders by different airlines in order to meet their fleet requirements, the profitability is still maintained by Boeing as number of orders increase. Also sourcing strategy fits with the stable demand of the product. As Boeing has consistent and stable demand of Boeing 787 dreamliners, hence the sourcing strategy is also stable and a predetermined level of dreamliners are produced by the company. Hence sourcing strategy is in accordance with the stability in demand of the Boeing 787 dreamliners.