Post-Launch problems

Feb. 6, 2012: Boeing finds a manufacturing problem in the fuselage section of some
Dreamliners.

July 23, 2012: ANA has five aircraft repaired after discovering a problem inside the Rolls-Royce
engine.

July 28, 2012: A Dreamliner suffers an engine failure on the ground at the Boeing plant in
Charleston. An investigation is announced by U.S. authorities.

Sept. 5, 2012: A hydraulic problem inside an ANA 787 causes the pilot to abort takeoff. White
smoke is seen billowing from the aircraft.

Oct. 4 2012: An engine problem onboard an Air Bridge Cargo 747 in Shanghai prompts General
Electric (NYSE:GE) to recommend the inspection of GEnx engines, which are used on some 747
and 787 aircraft.

Dec. 5, 2012: A report of fuel leaks prompts the FAA to order the inspection of all 787s.

Jan. 7, 2013: A fire starts on an empty Japan Airlines (TYO:9201) 787 at Boston Logan
International.

Jan. 8, 2013: An ANA 787 is grounded after a crack in the windshield is found. Also, a JAL
flight is forced to cancel after engineers discover a fuel leak.

Jan. 9, 2013: United Continental Holdings Inc. (NYSE:UAL) discovers faulty wiring near a
battery on six of its aircraft. The National Transport Safety Board launches an investigation.

Jan. 11, 2013: Another Japan Airlines aircraft is found to have a fuel leak.

Jan. 13, 2013: Japans Transport Ministry launches an investigation after a third leak is
discovered onboard a JAL aircraft.

Jan. 16, 2013: An ANA flight from Tokyo to Ube, Japan, makes an emergency landing after a
burning smell is detected in the cabin and a warning light comes on. ANA and JAL ground all
their 787s, and aviation authorities worldwide order the grounding of all Dreamliners pending
checks. Boeing halts all deliveries.

April 5, 2013: Redesigned batteries undergo final tests. Flights resume on April 26.

June 2, 2013: A sensor pressure detects overheating on one of its 787s.

June 23, 2013: United Airlines makes an emergency landing after a problem is discovered with
the braking system.

July 12, 2013: An empty Ethiopian Airlines 787 develops a fire at London's Heathrow airport,
which shuts down the entire airport temporarily. The fire was caused by a faulty battery.

July 18, 2013: A maintenance message onboard a JAL flight alerts to a fuel pump error.

July 22, 2013: An electrical panel grounds a Qatar Airways 787.

July 24, 2013: An investigation is launched after an oven overheats aboard an Air India flight.

July 26, 2013: Two ANA-operated Dreamliners are found to have faulty battery wiring, the same
problem that caused the fire at Heathrow.

July 27, 2013: United Airlines discovers a problem with an emergency beacon.

Aug. 27, 2013: A problem with slats (extensions of the leading edge of the wing deployed, like
the trailing-edge flaps, during takeoff and landing for added lift) forces a JAL 787 to turn back to
Tokyo.

Sept. 19, 2013: A United Airlines 787 develops similar flaps problems and is forced to declare
an emergency and land in Anchorage, Alaska.

Sept. 28, 2013: Technical problems with a transponder prompt a LOT Polish Airlines flight to
make an emergency landing in Iceland.

Oct. 9, 2013: Electrical problems caused failed lavatories and the failure of inflight anti-ice
systems on a JAL aircraft, which returned to San Diego.

Nov. 16, 2013: A British Airways flight experiences hydraulic failure.

Jan. 14, 2014: Full Japan Airlines Dreamliner fleet grounded after more battery problems.

Jan. 19, 2014: Air India flight loses all transponders.

Jan. 19, 2014: A China Southern 787 receives multiple system messages, including flaps, nose
gear landing, nose gear position, doors and brakes.

Feb. 5, 2014: All management computers fail aboard an Air India flight.

March 5, 2014: Cracks discovered on wings of 787s in production.

In 2003, Boeing decided to focus on creating additional value for its customers (airlines) and
their passengers by developing an innovative aircraft: the 787 Dreamliner. First, Boeing's value-
creation strategy for the passengers was to improve their travel experience through redesigning
the aircraft and offering significant improvements in comfort. For instance, relative to other
aircrafts, over 50% of the primary structure of the
787 aircraft (including the fuselage and wing) would be made of composite materials (Hawk,
2005). As compared to the traditional material (aluminum) used in airplane manufacturing, the
composite material allows for increased humidity and pressure to be maintained in the passenger
cabin, offering substantial improvement to the flying experience. Also, the lightweight composite
materials enable the Dreamliner to take long-haul flights. Consequently, the Dreamliner allows
airlines to offer direct/nonstop flights between any pair of cities without layovers, which is
preferred by most international travelers.
Second, Boeing's value-creation strategy for its key immediate customers (the airlines) and its
end customers (the passengers) was to improve flight operational efficiency by providing big-jet
ranges to midsize airplanes while flying at approximately the same speed (Mach 0.85).3 This
efficiency would allow airlines to offer economical nonstop flights to and from more and smaller
cities. In addition, with a capacity between 210 and 330 passengers and a range of up to 8,500
nautical miles, the 787 Dreamliner is designed to use 20% less fuel for comparable missions than
today's similarly sized airplanes. The cost-per-seat mile is expected to be 10% lower than for any
other aircraft. Also, unlike the traditional aluminum fuselages that tend to rust and fatigue, the
787's fuselages are based on composite materials, which reduce airlines' maintenance and
replacement costs.

Reasons for issues

the issues the plane has been facing have much more to do with Boeings decision to treat
the design and production of such a radically new and different aircraft as a modular
system so early in its development
No of orders exceeded expectations
Outsourcing the manufacturing of components with aim of shorter development cycle
times and lower development costs
To reduce the 787's development time from six to four years and development
cost from $10 to $6 billion, Boeing decided to develop and produce the Dreamliner by
using an unconventional supply chain new to the aircraft manufacturing industry. The
787's supply chain was envisioned to keep manufacturing and assembly costs low, while
spreading the financial risks of development to Boeing's suppliers. Unlike the 737's
supply chain, which requires Boeing to play the traditional role of a key manufacturer
who assembles different parts and subsystems produced by thousands of suppliers
(Figure 3), the 787's supply chain is based on a tiered structure that would allow Boeing
to foster partnerships with approximately 50 tier-1 strategic partners. These strategic
partners serve as integrators who assemble different parts and subsystems produced by
tier-2 suppliers
Check the pdf

The 787 was pitched as the airline of the future a revolutionary plane that that would use new
technology to bring aircraft design into the 21st century. The Dreamliner is made of carbon-fiber
reinforced plastic composite. More radically still, pneumatic and hydraulic systems have been
ditched for electric systems.

The technological leap was always likely to cause teething issues. But these were exacerbated by
Boeing's decision to massively increase the percentage of parts it sourced from outside
contractors. The wing tips were made in Korea, the cabin lighting in Germany, cargo doors in
Sweden, escape slides in New Jersey, landing gear in France.

The plan backfired. Outsourcing parts led to three years of delays. Parts didn't fit together
properly. Shims used to bridge small parts weren't attached correctly. Many aircraft had to have
their tails extensively reworked. The company ended up buying some suppliers, to take their
business back in house. All new projects, especially ones as ambitious as the Dreamliner, face
teething issues but the 787's woes continued to mount. Unions blame the company's reliance on
outsourcing.

Bill Dugovich, communications director at SPEEA, the professional aerospace union, said his
members had first voiced their concerns in 2002. "Outsourcing in general lengthens supply lines,
creates problems with language and culture and is extremely hard to coordinate. You have seen a
plethora of problems at Boeing. Things get outsourced then they have to come back to Boeing to
get fixed," he said.

Dr Amar Gupta, dean of Pace University in New York, has studied the construction of the
Dreamliner and is not convinced that outsourcing itself is the issue. "We have been outsourcing
since the industrial revolution," he said. The problem is one of communications, he argues, and
complexity. A car has roughly 15,000-20,000 parts; a plane has more than 2,000,000 parts.

"The concern is that each organisation did what it was asked but there was a failure to bring the
whole thing together, to integrate the systems," he said. Gupta thinks that with better
communication and organisation what he calls "24 hour knowledge factories" outsourcing
could pull off feats as complex as the Dreamliner.

there are two lessons learned from Boeings 787 mishap.

Firstly, the importance of simplicity and process. Project management is a process-oriented

discipline. Having a series of steps to follow makes any project that bit simpler. By out-sourcing
the design and manufacture of the 787, Boeing reduced its control on the project and its process.
This complicated matters and caused a litany of problems and errors which were difficult to
overcome.
Secondly, dont ignore the experts. Boeing received advice from technical experts warning of the
dangers of out-sourcing. They were also advised to keep the manufacture and design in-house.
This advice was ignored and billions of dollars lost as a result.