Circumventing Setback, Boeing no April Fool [1 of 2]

Abstract


This document considers what, if anything can be done to circumvent setbacks from a marketing perspective, given reengineering opportunities in the channel structures of Boeing.



Background

On Friday afternoon, April 1, 2011, a Southwest Airline Boeing 737-300 (Flight 812, Phoenix to Sacramento) found itself with an approximately 5-foot section of its upper skin removed, just as it had reached cruising altitude. The pilots immediately moved the planes position from an elevation in the 30,000s to the 10,000s within a period of approximately 4 minutes. Soon after, the plane safely landed at a military airfield in Yuma Arizona. There were no casualties.

The Arizona plane is 15-year-old, had undergone all inspections required ("ordinary", as well as "heavy") all relatively recently. Preliminary feedback asserts “we're dealing with a skin issue … a similar incident (two years earlier) ... (revealed) the hole was caused by metal fatigue.” Further, it is reported that the manufacturer, Boeing, is devising additional inspections. (Hoang et al., 2011).

The reason for the focus on Boeing, as opposed to Southwest, is for no other reason except that the durable-good which recently had an issue was originally the product of Boeing. It is easily arguable that Southwest had a much greater responsibility in the events that unfolded. However, Southwest does not produce durable goods.



The reasons for the setback

When an individual is financially challenged and yet they are still lucky enough to have a car, if the car begins to require maintenance yet still drives that given individual is faced with a weighted decision as to how bad things have to get (as well as what portion of what little jealously guarded funds there may be) before allocating movement in the maintenance direction.

A variety of airlines, Southwest included, have replaced portions of skins of planes along the way (it is unknown by this writer how drastic such a repair is considered). The thinness of the margins in this industry is well-known and well documented. Among all the maintenance protocols it seems safe to imagine that there must be very specific tolerance metrics already in place as regards wear and tear for every square inch of such skin. In this age of space shuttles it seems irresponsible to think otherwise.

Despite depreciating the cost of the plan itself, older planes are often sold "down industry" (two airlines operating out of countries of lesser economies); which is why we see more airline fatalities overseas.

Again, of itself this is not being laid at the feet of Boeing. Risk assessments for the insurance aspect of this industry regularly update the cost of "replacing" human life; such are the costs and payoffs weighed by airlines.