First presented to the public in 2007, the 787 Dreamliner was supposed to mark a brand new age for Boeing. It was a radical step above any other jet plane, made out of lightweight but super strong composites, boasting the most fuel efficient engines, a low cost of operation and maintenance for the airlines, and a quiet, comfortable ride for passengers. Airlines loved the Dreamliner, and ordered so many that the plane set a new record for sales.

However, the Dreamliner quickly turned into Boeings nightmare. The first test models of the plane were too heavy, causing a production delay while engineers redesigned certain parts. Then, when assembly began, Boeing was constantly plagued by part shortages, software problems, and substandard work from subcontractors, leading to massive delays and cost overruns. When the first Dreamliners finally rolled of the assembly plane, the project was three years behind schedule and had blown the budget by several billion dollars. And yet, the problems were just beginning. In the first years of service, the Dreamliner was plagued with mechanical issuescracked windshields, failing brakes, improperly installed wings, leaking fuel. The worstan electrical fire caused by a faulty battery. After the discovery of the battery defect, all 50 Dreamliners in service were grounded, the first time since 1979 that the Federal Aviation Administration had grounded an entire model line of planes.

What could have caused so much difficulty in the Dreamliner? Many industry experts point to a shift in how Boeing manufactured the plane. Traditionally, Boeing produced the majority of parts for its planes and did all of the assembly at one its factories. With the Dreamliner, however, the company decided to rely on outsourcing. Nearly 70 percent of the plane was manufactured and assembled by outside companies, with the components being shipped to Boeing, which would still take care of final assembly. The trouble was that Boeing did not have much oversight over its contractors. Boeing did not send out engineers and other staff to help guide the outsourcers in producing parts correctly. This was especially troublesome because Boeing wanted to incorporate highly innovative components, like carbon composites, lithium batteries, and new power management systems, but did not maintain tight control or supervision over the companies that were designing and making them. In short, Boeing emphasized speed and cost over precision, and it ended up paying the price for it.

Of course, Boeing is not done designing and making planes, not by a long shot. Its plans for the future include a new mid-range model to replace the 737 and a wide-body jet that will replace the 747 and the 777. The question is, shouldand willBoeing outsource for these projects as well? What about outsourcing might lead to more manufacturing problems? What can Boeing do to solve problems? In short, is it worth for Boeing to continue outsourcing?

You Decide

• Industry experts agree that outsourcing has caused massive delays and cost overruns to the Dreamliner. They also agree, however, that outsourcing itself is not the sole reason why the Dreamliner has had various mechanical problems. In fact, some call them teething problems that every new plane design goes through. Do you think that approaching the mechanical issues in this way is the right step for Boeing? Why or why not?
• What is it about outsourcing that can lead to so many of the problems that Boeing experienced? What can Boeing do to solve these problems?
• Should Boeing continue its reliance on outsourcing in the future, or does it need to return to how it used to build planes?