To reduce development time and cost for the
Dreamliner, Boeing fostered strategic partnerships with
approximately 50 tier-1 suppliers who will design and
build entire sections of the plane and ship them to
Boeing. By reducing its direct supply base, Boeing could
focus more of its attention and resources on working
with tier-1 suppliers (pre-integration stages) rather than
with raw material procurement and early component
subassembly. However, unless the supplier relationship
is managed correctly, reducing the supply base can
increase supply risks because of the reduced bargaining
power of the manufacturer (Tang, 1999). The rationale
behind this shift is to empower its strategic suppliers to
develop and produce different sections in parallel so as
to reduce the development time. Also, by shifting more
assembly operations to its strategic partners located in
different countries, there is a potential savings in
development cost as well (Figure 6).