Boeing has again delayed the delivery of its new Dreamliner 787 airplane. The venerable aerospace manufacturer said this week that the first customer delivery of the 787 would slip to early next year due to availability issues of the Rolls-Royce engines that will fly the plane. The rattle and hum of industry observers is breeding more skepticism, with some predicting that the first planes won’t be delivered until closer to mid-2011. The initial shipment was originally planned for May 2008. Boeing completely overhauled its supply chain processes and production plans in preparation for the Dreamliner’s rollout, but supply chain management failures and other disruptions have littered the path to launch for Boeing’s 787.
A customer’s failure tolerance is proportionate to its up-front investment in a product and the product’s uniqueness in the market. Boeing’s customers have been extremely patient, partly because they must be. But across the manufacturing world, there’s a sliding scale of tolerance among customers, and there are many factors that inform the politics of patience.
At the high end of the scale are the few manufacturers that are well-insulated against delivery failure, whose customers see their products as mission-critical and cannot easily rip and replace them, not even on paper:
- An airline that plans its fleet replacement, passenger capacities, pilot training, fuel costs, and hundreds of millions of dollars around the rollout of a new generation of airplane from a particular manufacturer
- A manufacturer that runs a branded ERP system or other enterprise application and has mapped out a transition plan to move thousands of employees and business processes to the latest version of that system
- A patient awaiting knee replacement surgery involving a specialized titanium fitting
Somewhere in the middle of the pack are the manufacturers with loyal followings and customers with specific wants and needs:
- A high-tech electronics company that has announced a groundbreaking mobile phone or tablet computer
- An automaker due to launch a groundbreaking hybrid sedan for the mass market
- A wind turbine maker with a sterling reputation in a green energy market only lightly populated by competitors
And at the bottom of the pack are the companies that can least afford to delay product launches or to stock out of their products:
- A food and beverage manufacturer rolling out a new energy drink
- A job shop that machines commodity metal components for an OEM
- A maker of wiring products for the home theater market
While every manufacturer intends to deliver on its promises, the best laid plans sometimes go awry. Seldom do they draw the worldwide attention that Boeing’s massive Dreamliner delays have. But the people who matter — your customers — are always watching. The challenge for any manufacturer is to understand where on the scale it operates, and to know how strenuously to respond to fire drills as they arise.
Boeing and the Patient Customer
Boeing has again delayed the delivery of its new Dreamliner 787 airplane. The venerable aerospace manufacturer said this week that the first customer delivery of the 787 would slip to early next year due to availability issues of the Rolls-Royce engines that will fly the plane. The rattle and hum of industry observers is breeding more skepticism, with some predicting that the first planes won’t be delivered until closer to mid-2011. The initial shipment was originally planned for May 2008. Boeing completely overhauled its supply chain processes and production plans in preparation for the Dreamliner’s rollout, but supply chain management failures and other disruptions have littered the path to launch for Boeing’s 787.
A customer’s failure tolerance is proportionate to its up-front investment in a product and the product’s uniqueness in the market. Boeing’s customers have been extremely patient, partly because they must be. But across the manufacturing world, there’s a sliding scale of tolerance among customers, and there are many factors that inform the politics of patience.
At the high end of the scale are the few manufacturers that are well-insulated against delivery failure, whose customers see their products as mission-critical and cannot easily rip and replace them, not even on paper:
Somewhere in the middle of the pack are the manufacturers with loyal followings and customers with specific wants and needs:
And at the bottom of the pack are the companies that can least afford to delay product launches or to stock out of their products:
While every manufacturer intends to deliver on its promises, the best laid plans sometimes go awry. Seldom do they draw the worldwide attention that Boeing’s massive Dreamliner delays have. But the people who matter — your customers — are always watching. The challenge for any manufacturer is to understand where on the scale it operates, and to know how strenuously to respond to fire drills as they arise.