The long list of Boeing’s woes seems to have reached its pinnacle in late 2003 with the scandal surrounding the Pentagon deal that alleged inappropriate behavior and the loss of documents by Boeing officials. After his seven-year reign as the head organization, December 2003 saw the eventual resignation of Phil Condit. Many breathed a sigh […]
The diagnostic model that would provide a framework that succinctly identifies significant aspects leading to the situation at Boeing is that of organizational change. The reason therein is that the success of a business is based on its capacity to amend the principle of work and implement administration transformation when the environment starts to make pressures for change (Sutevski, n.d.). In this respect, improvements are required in Boeing because its future is in doubt; it is facing growing competitive pressure, and its holdings reduced by 6.5% while under the leadership of Phil Condit. More so, the organization has made few reforms since World War II. Thus, despite being the leading aircraft manufacturer for many years, Airbus, their main competitor, booked more orders in 1994. Consequently, the firm’s management proposes a series of measures to be implemented to overcome unnecessary processes, outdated technological systems, and bureaucratic structures.
The first issue affecting the firm is based on adapting to change. For example, the market demand increased dramatically in 1997, and the company made efforts to attain the reserve of aggregate orders by promptly expanding its construction capacity. However, Boeing’s stature took a dramatic turn for the worse because an industrial predicament ensued when they were obligated to stop the assembly of the 747 Aircraft for 20 days. A lack of communication within the organization and the ‘win at all cost’ strategy they adopted appears to have been the source of that problem.
The second concept revolves around technology. In this regard, although the organization adopted lean manufacturing principles in 2001, intending to make production more efficient and rejuvenate its reputation, it still struggled with automating the fabrication. The information machinery of the firm was also decentralized, and the organization could manufacture the same product for one aircraft while subcontracting for another due to a lack of collaboration within the department. The last problem concerns the cultural implication of diversification. It is of particular concern that the many acquisitions and the decision to diversify from the traditional commercial airline resulted in integration issues for the enterprise. Arguably, such contextual elements have also influenced the behavior of the employees (Carter et al., 2013).
Based on the problems identified, it is evident that Boeing is facing the issue of organizational change, which is a natural, endemic, and ongoing aspect. The process is normal and transpires in different categories of organizations (Sutevski, n.d.). Therefore, business transformation is a necessity to prosper and survive. The fact that the company has made few reforms since World War II implies that it has, for a long time, ceased to embrace modifications; thus, it stayed in a static environment. For this reason, it failed to remain viable – since it was not flexible to quickly adapt and react to the external surroundings’ challenges.
Consequently, the business lost its competitive edge for various reasons. For example, technology affects how they communicate. More so, the customers’ needs grew and evolved, creating demand for new categories of products. All in all there necessitates the incorporation of changes into the institution’s system structures and processes to improve performance (Thomas, 2014)
Organizational diagnosis would be a crucial aspect of the change required in Boeing. The reason therein is that it would enable the management to answer the following critical questions: what (the content of transformation), how (its process), and why (its causes). More so, it is an innovative way of enhancing the firm’s competitive advantage as evolving external forces, including changing technology, globalization, and demographics, require the executive to retool and rethink the management strategies rapidly. In this regard, the most relevant concept is the Burke–Litwin organizational performance and change model. The method is appropriate when a cross-cultural implementation is required and when there is a need to analyze how the adaptation can be influenced. It is also vital in explaining how effectiveness and performance are affected and when a practical utility is required. Based on the strategy, the transformational factors concerning the efficiency and performance of Boeing include the following ones: individual and organizational performance, the company’s culture, leadership, vision, mission, and strategy, as well as the external environment. On the other hand, the transactional ones are as follows: motivation, individual needs and values, task requirements and employees’ skills, departmental climate, policies and procedures, management practices, and structure (Martins & Coetzee, 2009).
Source: Martins and Coetzee (2009).
In brief, the proposed approach has numerous strengths that are crucial for the situation experienced by Boeing. For instance, it explains linkages and distinguishes between the role of transactional and transformational dynamics of organizational change and behavior. Furthermore, it shows the cause-and-effect relationships between the company’s external and internal environments. However, its main limitation is that it is complicated based on the obscurity of organizational phenomena. In essence, the Burke–Litwin model is an aspect that would help the company to improve performance outcomes and behavior. Last but not least, it deals with effect (resultant performance) and causes (institutional conditions), serving as a guide for institution diagnosis as well as planned managed structural change (Martins & Coetzee, 2009).
Carter, M. Z., Armenakis, A. A., Feild, H. S., & Mossholder, K. W. (2013). Transformational leadership, relationship quality, and employee performance during continuous incremental organizational change. Journal of Organizational Behavior, 34(7), 942-958.
Martins, N., & Coetzee, M. (2009). Applying the Burke-Litwin model as a diagnostic framework for assessing organizational effectiveness. SA Journal of Human Resource Management, 7(1), 1-13.
Sutevski, D. (n.d.). What is the diagnostic model of organizational change? Retrieved from http://www.entrepreneurshipinabox.com/7281/organzational-change-a-diagnostic-model/.
Thomas, O. O. (2014). Change management and its effects on organizational performance of Nigerian telecoms industries: Empirical insight from Airtel Nigeria. International Journal of Humanities Social Sciences and Education (IJHSSE), 1(11), 170-179.
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Published On: 03-07-2014