Business Development Strategy to Fly High-Free-Samples for Students

Question: Discuss about the Business Development Strategy to Fly High. Answer: Introduction: The paper aims to study the operations of international projects taking the competitive market of airlines manufacturing as the background. The case study, which forms the substratum, mentions three companies, which give direction to the study. Murasaki Aircraft Corporation (MAC) with its strong shareholder base of MNCs like Toyota and already in the regional jet industry is seeking to enter international aircraft market. The CEO of the company wants to find out strategies to enter international market following the style of irbus and Boeing but wants to avoid their flaws. This intention of the CEO forms the basis of the sections, which make up the study. The section deals with the brief study of Airbus and Boeing, their ambitious aircraft building projects and their flaws in managing those projects. The next section elaborates these flaws to out lessons, which Murasaki must learn from the mistakes of Airbus and Boeing. The final section consists of recommendations for the airlines c ompany based on these learnings. The recommendations unlike the learning section go beyond the flaws of the two aircraft-manufacturing giants namely, Airbus and Boeing. The section also covers aspects like marketing and international expansion, which Murasaki can adopt to strengthen its operations. Project Management Cycle of A380 aircraft and Boeings 787 Dreamliner and outcome: The strategic management of A380 aircraft shows that the French airline manufacturing company Airbus uses advanced methodology to control the airline manufacturing operations. Airbus controls project management cycle at every stage including initiating the manufacturing projects worth millions of dollars, planning of manufacturing operations, execution. The efficient project management procedure spans over the areas like monitoring and control but does not include closing of these projects.A380 manufacturing project was one of the most ambitious projects and the company chose to partner with German airline manufacturing company Hamburg to ensure successful execution of the project. However, the consortium of the French and German was not as successful due to conflict between them. There were several flaws due to lack of cooperation among the management of Airbus and Hamburg. Hamburg designed advanced software for the use of the aircrafts but the same was not compatible with the older versions, which were already in use by the French airline company. This prevented smooth flow of project related between the two companies. The outcome of the lack of communication and collaboration between Airbus and Hamburg resulted prevention of installation of parts into the bodies of the airbuses. This ultimately led to halting of production of the ambitious A380 aircraft and Airbus suffered a loss of over $6 billion. The final outcome of Airbus to manage the A380 project was that the company had to postpone the delivery of the aircrafts to its esteemed client Singapore Airlines by two years (company.airbus.com, 2017). Boeings 787 Dreamliner is one of the ambitious projects taken by the American airline manufacturer Boeing Commercial Airplanes. Dreamliner 787 was the first plane with a fuselage having a composite barrel in the place of old-fashioned aluminium sheets used by the existing aircrafts during that time. The makers, Boeing Commercial spent a huge amount amount of money to money to manufacture the airplane and collaborated with international partners like NASA Ames Research Center. The company in order to ensure to accurately execute the project entered into subcontracting with Mitsubishi heavy industries of Japan and Korea Aerospace Industries of South Korea. The project execution of Dreamline 787 cost an estimated Boeing $ 32 billion (Boeing.com. 2017). The cost of purchase to obtain the expensive components exceeded the cost of purchase of its assembly facilities. The airways as result started suffering heavy loss on each aircrafts it manufactured. JPMorgan Chase estimated that BOEING s uffered a loss of $45 million per aircraft. The aircraft manufacturer started incurring heavy losses on each of its delivery of its airbuses to its clients. The outcome of the losses resulted in high operating costs of manufacturing aircrafts for Boeing and the company was forced to cut its operations and production costs to make up the losses. Another significant factor that led to tremendous loss to the ambitious project of Boeing 787 was the increasing competition from Airbus 380. The outcome of the excessive cost of production was that the company started to increase the production of Boeing 787 and sell them in the market to make the loss up. The company aims to add a hundred aircrafts to its current fleet by the end of 2017 (Airbus-dscomm.com. 2017). Lessons learnt from these two airline makers: Murasaki Aircraft Corporation (MAC) wants to enter the manufacture of medium sized passenger carrier market. The management of the company must take the following lesson from the flaws committed by big players like Boeing and Airbus and and their outcomes: Lesson 1: The project management history of manufacture of Airbus 380 and Boeing 787 has important lessons Murasaki Aircraft Corporation (MAC) can learn. Airbus in order to manage, plan and execute its ambitious aircraft project opted for partnership strategy. The partnership strategy the company chose to manufacture Airbus 380 was consortium with Hamburg of Germany. This strategy was apparently very promising and profitable for both Airbus and Hamburg. However, the lack of communication and collaboration between the apex management bodies of the two companies led to application of faulty technology. Airbus used the old version of software while Hamburg used newer version of the same software (Airbus.com. 2017). However, the two versions did not prove compatible which resulted in hindrance in further advancement of the project management of building Airbus. Murasaki Aircraft Corporation while manufacturing medium sized passenger jet should be careful while choosing the mode of management of it s ambitious project. The case study shows that MAC has stake owners like Mitsubishi Corporation and Toyota Motor Corporation. The management of the company would take prudent decisions if it enters into partnership with its stakeholders. The stakeholders Mitsubishi and Toyota are stakeholders of MAC. As a result, give more support to the latter, if they enter into partnerships. This is because they as stakeholders would want MAC to operate more successfully in order to gain more capital maximisation. MAC can enter into partnerships with external organisations to make medium size aircrafts only after it gain considerable penetration in the competitive market of international aircraft manufacturing. The first Murasaki Aircraft Corporation can learn from the management faults of Airbus is that; it must first gain competitive advantage in the international aircraft manufacturing market. This will entitle the company to gain equal position and say in the partnership (Kerzner 2013). Lesson 2: The history of Airbus reveals that the management bodies of Airbus and its partner suffered from flaws like lack of communication and collaboration. They kept on blaming each others strategies, which ultimately led to various defects. The conflict of interest caused huge gap in the flow of communication. This conflict blocked sharing of knowledge and technology between the two partners. Since, modern aircraft is largely dependent on flow of knowledge and technology, this blockage jeopardised installing advanced on the aircrafts. This led to Airbus delaying its delivery of aircrafts to its customer Singapore by two years, which caused losses worth millions. The lesson MAX can learn from this mistake is that while management of aircraft manufacturing project with third party firms, the management should maintain strong communication with the management of the partner (Schwalbe 2015). This would lead to smooth flow of information and technology between the two partners. The management o f manufacturing project should take place under close supervision of the two partners. This would lead to reduction of wastage, more accurate and dynamic decision-making and cost management that would allow both the companies to gain cost efficiency in production of aircraft. Lesson 3: The third lesson Murasaki should learn while manufacturing airplane manufacturing project is that it must manage costs very effectively. The history of Boeing 787 shows that the manufacturing company of the aircraft, Boeing Commercial Airplanes did not keep sufficient control over the budget and the expenses. The company invested a huge amount of money towards subcontracting and testing the aircraft. The company started incurring losses on delivery of the aircrafts, which were several times the projected profits. Murasaki being a new company in commercial airplane manufacturing market should not invest excessive cost on testing and promoting the aircrafts. The company should instead choose economic ways of manufacturing aircrafts by keeping the cost of production low and making low cost flights. The company can launch on manufacturing ambitious aircrafts only after it succeeds in earning profits and gaining commanding position in the international market (Fleming and Koppelman 2016). Lesson 4: The fourth lesson that Murasaki can learn is that it should make strategies to counteract challenges from the competitors during the project execution stage. The history f production of Boeing shows that the company had to cut the sale price, which inhibited the company from earning profit from sale of expensive Boeing aircrafts. Murasaki should enter the market by producing low priced aircrafts. This will enable the costs of production to be lowered in order to save expenditure. Again, in order to gain stronger competitive advantage in the market must be able to lower the prices. This strategy would prevent the company from incurring losses due to reduction of sale price to be more competitive (Shenhar et al., 2016). Recommendations in strategies to MAC: Murasaki has four lessons to learn from Airbus and Being. First, it must be careful while choosing the mode of project management operations to produce middle range aircrafts like entering into partnerships with external firms other than the shareholders like Mitsubishi and Toyota. Second, the management of MCA should maintain strong communications with the partnership firm(s) and control over the aircraft-manufacturing project. The third lesson is that Murasaki should not invest excessive amount of capital into operations and manufacture of aircrafts in the initial stage. The fourth lesson is that the company should enter the aircraft market with low priced aircrafts. The following recommendations can be made in the light of these four lessons to Lissane regarding business expansion of Muraki sans the mistakes of Boeing and Airbus: Making marketing a part of the project management strategy: A study of the history of Airbus and Boeing project management procedure and flaws bears no mention about marketing of the airbuses during their manufacture. Murasaki should combine marketing with its airplane-manufacturing plan. This will allow the company in multiple ways. First, marketing the aircraft nationally and internationally would create huge market which help the company attract customers. As a result, the company can earn more profit by offering its new products to the clients. Secondly, earning huge revenue would help the company to distribute its expenditure over this huge body of revenue. As a result, it would able to lower its sale price and gain economies of scale. These two strategies would help Mursaki to earn high competitive position in the market. Continue production of regional jets and international standard aircrafts: Murasaki should continue production of its traditional product, regional jets and the international standard aircrafts to compete with Airbus and Boeing simultaneously. Production and sale of regional jet would generate continuous revenue. The company can generate this revenue towards strengthening of manufacture of the international style jet crafts. Secondly, the company is already in production of jet and has customers in the local market. This customer base can provide Murasaki with references in international airlines companies, which can help it to secure orders for Airbus style international aircraft more easily. As a result, it would be able to charge higher prices for the aircrafts and earn higher profits. Thus the company can secure high competitive position in the national and international market. Expansion into the developed and emerging markets: Murasaki must expand into both the developed and emerging markets to gain competitive advantage in the competitive international market. Airbus and Boeing serves clients from both western markets like British Airways and eastern markets like India and China. This will enable the airline to gain dominance in both eastern and western markets. References: Ahmed, S. and Zlate, A., 2014. Capital flows to emerging market economies: A brave new world?.Journal of International Money and Finance,48, pp.221-248. Ahmed, S. and Zlate, A., 2014. Capital flows to emerging market economies: A brave new world?.Journal of International Money and Finance,48, pp.221-248. Airbus.com. (2017).Cite a Website - Cite This For Me. [online] Available at: https://www.airbus.com/content/dam/corporate-topics/publications/backgrounders/Airbus_Global_Market_Forecast_2017-2036_Growing_Horizons_full_book.pdf [Accessed 5 Nov. 2017]. Airbus-dscomm.com. 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