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OM in the News: Innovation is a Messy Business

February 1, 2013
Grounded Japanese 787s

Grounded Japanese 787s

In Chapter 5, Design of Goods and Services, we talk about how new products are the heart of a great company. 3M, for example, introduces a new product every day! But The Wall Street Journal (Jan. 24, 2013) headline warns: Innovation is a Messy Business. Writes the Journal, “Aviation innovation is especially risky because the stakes are so high. A crashed laptop might lose data, but a crashed plane kills people.” Unlike 3M products, entirely new jetliners get developed only about once a decade, costing billions of dollars.

Nine years ago, Boeing  decided to take the biggest leap in airliner technology in a generation and develop the 787 Dreamliner. Boeing promised it would burn less fuel while flying farther and offering more passenger comfort than existing models. The 787 also showed Boeing’s “commitment to innovation.” Airlines, eager to save money and woo fliers, ordered a record numbers of Dreamliners.

We in academia have made “innovation” a buzzword for competing in the global economy. Boeing’s experience offers a reminder that innovation—for all its value—doesn’t come as easily as a catchphrase. It can get messy. Boeing, an icon of  ingenuity, has reshaped travel over the past half-century with bold technological leaps such as the 747 jumbo jet. But the 747 first nearly bankrupted the company due to technical problems. Boeing’s backers say the Dreamliner will prove just as revolutionary.

The 787’s problems again show the traumas that innovation can bring. Boeing said the plane would leapfrog advanced technologies at Airbus. It would rely more on electricity to run its systems than existing planes, which used hydraulic and pneumatic power. To convince wary airline executives that carbon-fiber body material was strong, Boeing sales teams carried samples and hammers, letting airline executives whack the composite with all their might. Airlines signed on, knowing the risk.

Discussion questions:

1. What are the main operations problems facing the 787?

2. Why did Boeing risk introducing such a radically different plane?

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