Executive Summary of Dreamliner Project

This is only for a no-grade continuation education course

Please create a 25 slide Microsoft PowerPoint presentation and keep this at the executive-summary level of detail.

When Boeing first planned its 7E7 Dreamliner fuel costs already had become problematic for several airlines. That was before increasingly sharp spikes in fuel costs however. Today, the Dreamliner looks more appealing to customers than in its earlier stages. With an innovative design visually appealing to passengers, the Dreamliner enables Boeing customers to pleasantly surprise their passengers. The Dreamliner plans to be so visually appealing that at least some passengers will choose an air carrier-based solely on its use of Dreamliners.

The Dreamliner will have other features that make the aircraft attractive to customers as well, not the least of which is that it will be much quieter than most older aircraft. Noise may not be an issue in every market; however all airlines battle noise restrictions and abatement procedures. The Dreamliner promises to be of benefit in this regard.

Project Description

The goal of the project is to design product and process for manufacturing the Boeing 7E7 Dreamliner. The project will involve incremental monitoring of the 787 Dreamliner, so that approaching problems with the innovative aircraft will be apparent before the project progresses too far.

Clearly, the Dreamliner project is a huge undertaking in which there are myriad opportunities to digress from the stated schedule devised at the outset. As an example, there are more than 100 companies involved with the Dreamliner production and development in Australia alone (Hopkins, 2005), and the Dreamliner will not even be assembled there. The assembly plant is expected to cost $1 billion and to require the labor of 800 to 1,200 employees at an average salary of $65,000 each (Cronan, 2003).

Problem Statement

The void that the Dreamliner intends to fill holds at least two facets, one within Boeing and the other within the commercial air passenger industry. As indicated before, nearly all Boeing's customers have had difficulty in the past, and two more, Delta and Northwest, recently joined the list of large, established airlines operating under Chapter 11. Fuel costs constitute the single greatest concern for these airlines at present, though fuel costs alone do not account for the costs of less than astute management over the past decade or so.

These and other problems within the airline industry have led to difficulties at Boeing as well, in that airline customers have not purchased as many new aircraft in recent years as in the past. Boeing seeks to rectify this situation with the Dreamliner.

As Boeing project manager of the 787 Dreamliner, it will be important to correctly identify the scope of the project and adhere to the defined view. Otherwise, the project easily could become susceptible to "creep" and expand in unplanned ways (Gray and Larson, 2005).

As Boeing project manager of the 787 Dreamliner, it will be critical to be particularly watchful for signs of "creep" because so many other companies are involved in the 787 Dreamliner project. Of course Boeing has final say and control of the project; however it can expect many of the companies involved to voice ideas and opinions, some of which can be quite valuable. Hopkins (2005) reports that literally hundreds of Australian companies are involved with the Dreamliner; another author reports that Vought and Alenia North America have finalized arrangements forming a joint venture for the specific purpose of joining and integrating fuselage sections manufactured in a variety of European locations (7E7 production arrangements, 2004).

Mission Justification

"Boeing's Vision 2016 mission statement spells out three business strategies" (Arkell, 2005). These three strategies are:
- "Run healthy core businesses...
- "Leverage core strengths...
- "Open new frontiers" (Arkell, 2005).

The Dreamliner will make a positive contribution to the health of Boeing's core business, and in so doing leverage the company's core strengths. It certainly opens new frontiers, in that there is not another aircraft like it. Airbus currently is retrofitting an older model to take on an appearance similar to the Dreamliner's, however the Airbus offering will not be able to offer the fuel savings possible in the Boeing 787 Dreamliner.

High-Level Scope

Gray and Larson (2005) provide a Project Scope Checklist containing the project objective, deliverables, milestones, technical requirements, limits and customer reviews. This certainly is a broad enough scope without being so broad that the 787 Dreamliner project manager could go astray with it.

At the same time, the checklist can be used as a guide to assessing Boeing's approach to the project to date. It likely does not have all the technical matters in place yet; however the first several requirements of the checklist already are in place and have been for some time. Chung-Suk and Gibson (2001) recommend the use of a project definition rating index to assess the appropriateness of the scope of any large project.

Measuring Project Success

There are several approaches and measures that as project manager can use to measure schedule progress to determine the success of the 787 Dreamliner project. There are several orders for the aircraft, likely with significant deposits attached to them. Failing to complete the project on time has the potential of negating at least a portion of the contracts that the company already has for the 787 Dreamliner.

The product itself also can be used as a point of assessment of the project's success. Some detractors claim that Boeing's reliance on plastic, for weight reduction and therefore greater fuel efficiency, is unfounded and unproven. As the Boeing 787 Dreamliner project manager, a plan will be devised for assessing project success with regard to using plastics before rolling out the first production model. Taverna (2004) reports that Boeing will use Dassault Systemes' Product Lifecycle Management system in managing the "design and production processes for Boeing's 7E7 Dreamliner." The life cycle management system "outlines the role of the key element to be included in this project that includes the virtual product development concept, the virtual product management system, the virtual reality center, and the Falcon Global Test Bed" (Taverna, 2004).

Application of Best Practices

Two best practices in project management that could be applied to the project to ensure its success is to maintain tight control by the project manager on the various aspects of the project and to control the number and complexity of changes allowed in design or production processes after the start of the project.

Hollmann (2003) discusses the pressures that several decades of downsizing and outsourcing have caused for many industries. Boeing has had difficulty in this area already, though its experience was several years ago. Boeing decreased its workforce so drastically that it could not efficiently take advantage of new government contracts and had to hire inexperienced, unproven design personnel. Though Boeing will be outsourcing much of the subassembly work associated with the Dreamliner project, it maintains its own design and project management personnel to provide greater accountability and incentive for bringing the project in on time and within budget.

Boeing also practices astute change control in all its projects, and there is no reason to believe that the Dreamliner project will prove to be an exception. One of the greatest threats to any project is failing to properly define it at the outset and changing aspects of it well after it begins. Not making changes obviously needed results in an inferior, or worse, product; adding all the changes that possibly could be made has the effect of delaying the project and preventing it from being completed on time. As Boeing 787 Dreamliner project manager, it is paramount to maintain tight control of changes, disapprove most while allowing only those that make the product safer, more reliable or more attractive to customers.

Aligning the Project with Boeing's Business and Conclusion

The project aligns well with Boeing's core business and with its stated corporate mission. When it becomes available to the market, the Dreamliner will exist as a unique product not available from any other organization. As stated, Airbus will offer a possible substitute product; however one that is not likely to be equal to the Dreamliner in any aspect. Boeing's history and reputation further will support the Dreamliner in terms of sales to commercial airline companies.

Boeing learned its outsourcing lessons several years ago, and currently strives to right size rather than to become so lean it cannot function at full capacity. The Dreamliner should contribute to increased capacity, providing Boeing with additional lucrative opportunities not associated with the Dreamliner.

The size of the project and the use of new technology are known. The impact of each, however, is unknown. The project is inherently large and complex. Organizations from different nations will be involved in the design and manufacture of this aircraft. Language and technology barriers and the regulations of other nations will present risks.

The five milestones for this project are:
- Authority to Offer - 2003 (Bhatia, 2005).
- Program Launch - 2004 (Bhatia, 2005).
- Firm Configuration - 2005/2006 (Bhatia, 2005).
- First Flight - 2007 (Bhatia, 2005).
- Certification and Delivery - 2008 (Bhatia, 2005).

Project Risks

The risks in this 787 project are: 1) the size of the project, 2) the context within which the aircraft will be manufactured; 3) the use of new technology; 4) inaccurate estimates in the schedule; and 5) communication failures. Given the fact that suppliers in more than 20 countries will be involved in this project and that between 70 and 80 percent of the plane will be built by other companies (Pike, 2005), it is certain that communication problems is a risk dimension in this project.

With assembling a team, the team will need both software and old-fashioned poster-boards. Advanced project management software will keep an electronic record of every step in the project. A poster-board is clearly visible by everyone and can identify the major points that have been completed successfully. The poster-board will resemble a less sophisticated PERT chart. These tactics will keep communication flowing between and among all those who are involved in this project. With this plan, there will be no unpleasant surprises. In summary, the plan to mitigate the risks associated with communication failures of any kind will include:
- Establish a person or a team responsible for coordinating all communication.
- Each and every supplier needs to provide frequent updates on their progress.
- There will be times that weekly or semi-weekly progress reports will be satisfactory; there will be more times when daily communication between the team and each suppler will be essential.

- A timeline needs to be presented to each supplier for delivery of components and parts.
- Suppliers need to present frequent 'written' reports; these may use Intranets or e mails to the team.
- Suppliers must communicate any problem to the coordinating team expeditiously.
- The team will need to use project software for coordinating the thousands of pieces of data and information that will be reported to them.
- The team will need to use something like a poster-board that will have the major milestone dates written on it.
- The communication plan should include the reports necessary, the transportation to be used for shipping, shipping dates, and delivery times. These will help to reduce the risk of communication errors.

The Boeing 787 Project Manager will implement a risk management plan, the 787 Dimensional Management approach (Day, 2005). Day (2005) explains this is a highly disciplined approach that helps to understand "the probability/costs of, and appropriate responses to, geometric variation of parts and assemblies" (Day, 2005). This is a "Product Definition Phase" effort (Day, 2005).

The different phases incorporated into the 787 Dimensional Management approach are identified by year-span 787 Dimensional Management approach (Day, 2005). For instance, the phase between 2002 and 2005 is the Product Definition phase; the emphasis of Dimensional Management is risk avoidance and also on risk abatement (Day, 2005). Beginning this year, overlapping with product definition is the Product Build and Product Deliver phases; will continue until 2008 (Day, 2005). At this point, variable management approaches are employed focusing on risk management (Day, 2005).

The 787 Dimensional Management approach will include maintaining detailed and accurate records during each phase of the project (Day, 2005). The records and reports include both analyses and evaluation of the project's progress (Day, 2005). The process is iterative, meaning it will continue over and over again without end until the project is finished. A number of steps are reported as part of this process (Day, 2005). These includes activities such as revising requirements, revising design, revising assembly sequence, revising indexing and building plan, revising datum selection and validation plan, financial study justifying the cost of reword and the management team agreeing to accept the degree of risk involved (Day, 2005). Each item is a question (Day, 2005). It works like a PERT chart; if yes, do this, if no, do that. However, if there is a problem or if some step had not been completed, that step will be started again.

There are a myriad of tasks to accomplish and issues to consider as project manager for the Boeing 787 Dreamliner Project. For one, there needs be a communications plan outlining how projects will be ordered. Such a plan must demonstrate how progress will be reported and measured. How will information be reported to project sponsors and executives in the context of project reporting? First, a brief overview of the Boeing 787 Dreamliner Project is described below.

The Dreamliner is a design by Boeing 787 that plans to be available for flight sometime during 2008 ("Boeing 787-8," 2005). The 787 is expected to utilize technology that had been suggested for the Sonic Cruiser ("Boeing 787-8," 2005). This project will result in a new, innovative and efficient aircraft. Boeing reports that it will be about twenty percent more fuel efficient than other aircrafts ("Boeing 787 8," 2005). As aircraft in general are developed over time, they will become inexpensive to operate and more efficient than previous models. Technology always renders old models less efficient. With that said, when it comes to aircraft, in the current economy that has observed increasing fuel prices, the 787 will become an anticipated addition to any airline fleet. Of course, there has been criticism lodged at this innovative aircraft, as is with any new innovation ("Boeing 787-8," 2005). Airbus for instance claims that its product will be superior to the 787 Dreamliner ("Boeing 787-8," 2005). Only time will tell if this is accurate.

Project Reporting

Reporting will be done at a variety of levels. While using the term "report," it implies that something formal is anticipated. However, reporting may also be informal to an extent. Progress must first be measured before reporting and this is done in a variety of ways. Yet, those measurements must be conveyed either through written communications or verbal methods. In regards to communications in general, Duncan (1996) explains that there are three dimensions and these are written and verbal as well as listening and speaking. Sometimes, communication may be external while otherwise it will be internal (Duncan, 1996).

For this Boeing 787 Dreamliner project, reporting will be primarily internal. Eventually, in 2008, reporting will be conveyed to the general public. Boeing's stock has increased in value and this is something purportedly related to the advent of the 787 Dreamliner project. In general, communication is about informing key shareholders as to what precisely is occurring in respect to progress being made on a project. In the case of reporting on the Boeing 787 Dreamliner project, reporting will be done consistently to the Board of Directors, as well as to all executives and employees of The Boeing Company. Specific information will be reported to key shareholders as well as to all participants on the 787 Dreamliner project.

Forecast

Forecasting is much like looking through a crystal ball, but it should not be like that, in particular, with the 787 Dreamliner project. Project managers need to be able to adequately make forecasts so that they are close to what the outcome will be. Duncan (1996) remarks "Schedule development means determining start and finish dates for project activities. If the start and finish dates are not realistic, the project is unlikely to be finished as scheduled" (p.66). With this in mind as project manager, there is a sense that accuracy in prediction is critical to success. As the project manager creating a schedule, it will be critical to look at any dates or peripheral projects that might get in the way and create a timeline of sorts. It is important to write down a Start date and a Finish date and then jot down all things in-between. Is there too much? Estimations will be made by calculating work hours via looking at the number of workers, how many hours they can put in, the human resources budget and so forth. When making projections for the Boeing 787 Dreamliner project, it is decided that Firm Configuration would come during 2005 or 2006, first flight will commence in 2007 and finally that certification and delivery be achieved in 2008 (Bhatia, 2005). A timeline for the Boeing 787 Dreamliner project consists of the following:

- June 2006 Firm Configuration
- September 2006 Begin construction
- January 2007 Construction of the craft completed
- March 2007 Testing phases commence
- June 2007 Final Testing
- September 2007 First Flight
- January 2008 Examination of first flight
- March 2008 Decisions on changes, if any
- June 2008 Final changes implemented
- September 2008 Certification and Delivery

Project Closure Process

Closure is important. If this Boeing 787 Dreamliner project ends erratically, or is simply not closed out to the satisfaction of all concerned, issues could linger. For example, in one Boeing project in the recent past, a user department's output had errors however they were never corrected. As a result, closure was not successfully achieved. Duncan (1996) writes: "Administrative closure consists of verifying and documenting project results to formalize acceptance of the product of the project by the sponsor, client or customer" (Duncan 1996, p. 109). The overall project termination strategy for the Boeing 787 Dreamliner will consist of thorough testing and informing all shareholders of the project's completion. Feedback, and answering of feedback will be the final stage.

Project Audit Process

In auditing anything, as project manager of the Boeing 787 Dreamliner, there is a sense that quality is the objective. Why audit anything if quality is not important? When designing an auditing process, quality should be the key goal in mind. Duncan (1996) explains that project management must be aware of quality management. The two paradigms should compliment one another (Duncan, 1996). A quality management model, TQM (Total Quality Management), will be implemented to assure that what is being achieved is done so at the highest level of excellence. Auditing will be done with the use of external help instead of with only internal safeguards.

Budget Process Estimates

Duncan (1996) indicates: "Cost estimating involves developing an approximation (estimate) of the costs of the resources needs to complete project activities" (Duncan (1996, p. 76). The author notes that while costs may be projected, it is possible to consider ways to reduce costs during the design phase (Duncan, 1996). First, it appears that the cost of the Boeing 787 Dreamliner will be disadvantageous, however, it is a fuel efficient design and that must be regarded as well. It resembles when someone puts in central air-conditioning into their home. Not only does the value of the home increase as central air-conditioning pays for itself, but the consumer will save money over time in electricity costs if they switch from window units. Similarly, 787 will save the airline customer money over time because of the fuel design.

The following provides an explanation of the cost savings: "Boeing promises that the 787 Dreamliner will save airlines 20 percent a year in fuel costs and 10 percent in total operating expenses. A 767 typically uses just under 91,000 liters of fuel during a long-haul flight; a 787 would consume just over 18,000 liters less, saving nearly US $8,000 a trip at the current wholesale price" ("Japan Dream Rides," 2005). In creating cost estimates, it is important to note that the price of the 787 Dreamliner is $150 million (Morgan, 2005). Estimates will be developed for each phase of the 787 Dreamliner project and will include everything from human resources to work hours to the cost of the parts to the cost of shipping. Every expenditure will be realized.

Conclusion

With designing an overall scheme to create the Boeing 787 Dreamliner, many things need to be considered. A good management protocol will be implemented so that quality is assured. As project manager, reporting progress to key shareholders is imperative to success. Money needs to be tracked and a budget strictly adhered to, furthermore, it is important to promote the 787 Dreamliner project to the likings of even the harshest critics. Regardless of the competition and potential difficult conditions, as project manager of the Boeing 787 Dreamliner, the plan is to get this innovative and incredible aircraft off the ground successfully.