I don’t know about you, but whenever I think of the word “Boeing” my mind instantaneously thinks of something huge. No wonder these are some of the biggest aircrafts in the world. Not only that, Boeing is the largest aerospace company in the world.
The Boeing Company has been around for a really long time and has gone through many significant phases to reach the place it is at today. To analyze the different aspects of the company, we conduct a Boeing SWOT Analysis.
History of Boeing
Hailing from America, Boeing is the leading producer of many aerospace products like military aircraft, helicopters, space vehicles, and missiles, but they are most famous for their commercial jet transports. William A. Boeing started the company in 1916. Initially, they sold only airplanes to the US Navy, but slowly the company expanded into other markets and introduced new products. Presently, their headquarters are located in Chicago.
Earlier, Boeing was called the Boeing Airplane Company; the name change happened in 1961 because they wanted to showcase that they are venturing into new markets beyond just airplanes. They now have a lot of diverse products, but their main feature still remains the Boeing aircraft. The company manufactures seven distinct families of these aircraft, and it has three facilities to assemble them in.
Even someone who does not know anything about aircraft has heard the name of the company. This is because Boeing has been around for more than a century now, and it has taken the time to develop itself into one of the biggest names in the market.
Boeing now produces products in the military sector and space & communications sector. They have partnered with other companies for various productions and also went through mergers and acquisitions. They have been successful many times in overcoming challenges and coming up with innovative ideas to compensate for their shortcomings. Overall they work in three distinct sectors: Commercial Airplanes; Defense, Space & Security; and Boeing Global Services, which is a more recent service.
There are many other organizations and arms inside the entity that work on various other functions and departments. These portfolios include engineering, safety, technology, finance, advanced design, quality, productivity improvement, program management, and information technology.
The company has a workforce of almost 140,000 people and that too in 65 countries around the world. These numbers ensure that the workforce is diverse and innovative. This provides employment opportunities to a wide array of people.
Boeing now also has the Boeing Capital Corporation (BCC), which works to provide finance solutions to the customers of the company. This corporation ensures that the customers are financially stable enough to purchase these products. They have a talented group of finance professionals who bring their expertise of financial knowledge to the table to provide a valuable experience to the consumers.
What are Boeing’s Strengths?
Diverse Range of Products
One of the biggest strengths of the company is that it delivers a wide range of products. Whatever kind of airplane people need to purchase, Boeing will probably have it available. This gives the company a lot of edge over other competitors that offer only a limited range of products.
Boeing offers commercial planes, private jet planes, corporate jets, and many others too. The company has strategically developed itself in a way to provide many products and services that make it a leading supplier in the market.
Strong Supply Chain
The way that Boeing manufactures its products requires it to buy raw materials from various places all over the world. To ensure that this process is carried out smoothly, the company needs to develop a supply chain that is efficient and strong, and it did just that.
They make sure that all the raw materials and individual components are received timely, and then the final product is manufactured and delivered to customers on time as well.
Partnerships pave the way for a company’s success in many ways. Boeing has strategically partnered up with relevant companies that are big names and hence provide mutual benefit to both brands. They have partnered up with companies from all over the world and achieved many bounties out of it.
They have also established solid and meaningful relationships with these partners and ensured them of their value to their brand. Focusing on partner relationships can be really favorable for a company in the long run. Hence, this has proved helpful for Boeing.
Today, the most valuable brand in the industry is the one that has the highest levels of creativity and innovation. There is so much competition that you need to bring something unique to the table that sets you apart from everyone else. Boeing has a huge name for being innovative, and it is incredibly famous for its drive to keep bringing out new ideas.
They have brought many valuable changes to the airline industry by their inventions, such as lightweight carbon-composites and innovative fuel efficiency technologies. Boeing gives serious competition to other firms in the market and forces them to achieve more as well so they can keep up.
What are some weaknesses that Boeing has?
Poor Labor Management
It is always hard to manage labor in a company of this size. Boeing has a labor force that is spread throughout the world and it adds up to a vast number; it is hard to maintain consistent standards across all of it. There are bound to be problems. Employees in South Carolina were fired over the formation of a union. Such situations can cause internal discrepancies inside the company and cause employees to revolt.
Heavy Reliance on Out-sourcing
As mentioned before, Boeing imports many of its raw materials and components from other countries; if there is any problem in the supply chain there, it can cause significant issues for the company. This is a contention that the company constantly needs to think about, and it can quickly turn into a huge weakness.
Dependence on the US Government
A big chunk of Boeing’s revenue comes from the contracts that it formulates with the US government; this factor puts the company under the constant influence of the economic and political climate of the country.
They have to comply with hefty policies and regulations that often make a company shift how it orders its operations.
One of the company’s airplanes, the Boeing 737 Max, has faced issues in the past when two of its planes crashed fatally over a similar malfunction. This was a major weakness for the company. Such incidents affect the trust that customers have in a company and leave a mark on the name.
What are some good opportunities for Boeing?
Utilizing the Capacity for Innovation
Boeing has already showcased that they have an unlimited capacity for innovation. They have constantly strived to come up with new ideas and inventions that give them an edge over other competitors in the market.
They can keep working on this to come up with new technologies. They already have many creative ideas in development. An excellent example of this is how Boeing partnered with Uber to build air-taxis and with Volkswagen to make flying cars. They can expand further on these ideas to take them towards commercialization. They can also build on other such concepts and create new avenues for themselves.
Boeing, as a brand, is already thinking about sustainability and working to reduce its carbon footprint. They can make a multitude of efforts in this direction because of how considerably vast their brand size is.
They are already deploying fuel-efficient technologies. They have also been testing technologies that help lower noise pollution as well as harmful emissions. By making these efforts, the company contributes to a broader global effort of fighting climate change. This also proves significantly suitable for the image of the company.
The demand for satellite technologies and other space-related planes is consistently increasing. This is a fantastic opportunity for Boeing to invest in these projects and develop new products. If they exploit these opportunities fully, they can generate a good influx of money and profits for the company.
The aerospace market is growing globally, and that opens up many spaces for Boeing to retain its market share to achieve even more. This is a good opportunity for the company to increase its revenue. The market is only expected to grow more because of the growing technology and the fast-paced industry.
What are some threats facing Boeing?
A Competitive Market
Competition is one of the biggest threats facing any firm because there is always so much at stake. You could lose customers if you are not constantly thinking about establishing your company as a top shareholder in the market that manages to retain its consumer base by providing them with a unique value.
It is much more harmful to lose customers in an industry like the airlines because one customer or order lost could mean a loss of millions of dollars. Airbus is one of the biggest competitors that Boeing has and it also has a strong backing from the EU. The clash between these two firms is very intense so Boeing has to struggle to maintain its position constantly. Hence, this is a consistent threat for the company.
The COVID-19 pandemic has made people very wary of international or even local travel and rightfully so. This incident has decreased the business of airlines, and now they struggle to gain customers. Many airlines might go bankrupt if the situation persists, and this will reduce airplane sales as well. The economy has been dwindling worldwide so Boeing is affected by the adverse situation as well.
Going back to the crash of one of Boeing’s airplanes, such a fatal incident can highly concern the public regarding the safety measures of the aircraft and it can also heavily impact the image of the company.
People have also been fearing lane hijacking and terrorist attacks which negatively affects their perceptions of air travel.
All around the world, countries are heading towards a recession, financial situations are dropping, and companies are going bankrupt. All of the airlines that purchase from Boeing are having a hard time staying afloat so naturally this will impact Boeing’s business as well. This recession has left no company unaffected including Boeing.
The biggest reason it is hard to deal with the effects of the pandemic or the recession is because of the uncertainty of the situation; we do not know when things will be going back to normal or how normal will even look like after all of this is over.
Boeing SWOT Analysis: Conclusion
Boeing is a big name not just in America but worldwide. The company has a very prestigious place in the market. Though it might be facing threats and weaknesses, there is nothing that might seriously displace the company from its position as of yet.
Boeing has a lot of opportunities to continue being the biggest name in the market; all they have to do is keep up with their current trend of innovation and creativity.
SWOT Analysis is a tool that administrators and managers use to evaluate their institutions or businesses at a more profound level. Conducting a SWOT Analysis can be very insightful and provide you with many new perspectives, along with PESTLE analysis. Taking a look at other SWOT analyses, especially of those from your competitor firms, can also be very beneficial in understanding the market and the position your company takes in it. This is why we have many SWOT Analysis examples available on our site for your perusal.
Some people might find it hard to carry out a SWOT Analysis and might need help in understanding the process of it, which is why we also publish a guide and templates for you to get a better grasp on the procedure of carrying out a SWOT analysis for your own company, business or institution.