Systems And Operations Management Airbus Project

Systems And Operations Management Airbus Project


Executive Summary. 2

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Introduction. 4

Background Information. 4

Flouted input-process-output model 6

Decision on Strategic Level; Tactical and Operational 7

Information Systems and Operation System Failures. 9

Conclusions. 11

Recommendations. 12

Quiz. 13

Bibliography. 15

The responsibility of a company’s management is put to test during major operations and processes that the company engages in. Laxity and unresponsiveness to organisational practices that unlock success puzzle for success can squarely be placed on the management team’s shoulders. It is therefore a major expectation of the stakeholders that systems and operations management winning practices are designed at the managerial level. Contained in this discourse is the case study that represents Airbus almost failed project A380. The case study analyses the reasons behind the unprecedented hitch from a management point of view and reveals the laxity that occasioned huge losses to the company. Various theories of operation and process management have been visited in the case study to formulate the appropriate recommendations.Executive Summary


Since inception in 1970, Airbus has had to maintain a corporate goal of lunching a competitive fight that would enable the realisation of a sustainable market share. Despite the competitive nature of the market from major players such as Boeing and Lockheed, Airbus kept the nerve to initiate bold investment projects that enabled it to grow and reach the global status. A winning corporate combination of practices such as operations and strategy management ought to have played a major role in the rise of the company. To surpass its anticipated entry into the market, Airbus management had to venture into more challenging business that no one else had ventured into.

An ambitious diversification of the organisation package of market participation was identified as the solution to keeping up with the pace of the market’s dynamic challenges. To this end, Airbus rolled out one of the most daring ventures amid internal capacity issues. Such a venture is the A380 project that became too much of a challenge along its initial implementation. Perhaps with the best operations and process realignments that corporations in this age need to armour their planning with, the success of the A380 project at Airbus would be a different story. An analysis of the project using insights postulated by systems and operations management theory has been used in the case study of the A380 project to highlight useful corporate lessons worth of sieving from the failures thereon.

Background Information

Airbus systems and operations logistics were evolving at an increasing rate since its founding in 1970 aiming to formulate a consortium of air transport initially covering Britain, Spain, Germany and France. As a consortium, it was not clear if the individual companies involved would fully surrender their identities and merge into a fully fledged company that could venture into unitary projects without divisions. Despite the strength in the original capacity expansion plan targeted by conglomerating a number of distinct companies operating in diverse markets in Europe, a weakness in functional operation of the umbrella business was to sooner emerge regarding the corporate system and operations management strategy. This was particularly observed in the year 2000 when Airbus, decided to roll out a competitive strategy project despite the internal organisational challenges its systems and operations capacity faced. The project A380 involved venturing into superjumbo design and manufacturing. According to Shore (2009, p1), the project was to be undertaken while the company retained its distinct companies structure which created logistic conflicts among the branch companies.

Project A380 was to produce aircraft by that name that had capacity of holding over 850 passengers and crew. From the initial projected timeline for the pilot project, it would run from 2000 to 2002, an indication of the ambitiousness of the project of its nature which would normally take longer operational duration of time. Due to the previous incapacity observed in the consortium, plans were underway to involve management integration for the distinct companies. However, before the actual management integration, the project was already running, placing it under the risks of the unpleasant operational management incapacities. Serious problems arising from the various incapacities caught up with the project causing a delayed delivery of the much anticipated A380.

The German and French wings of the consortium engaged in differences that became evident as the blame game on the delay began to emerge. Several other operational logistics were missing aggravating the condition of the project. Apparently, the most fascinating hindrance that these internal conflicts brought to the company could not be mitigated in good time despite the managements’ awareness that seemingly could have reduced the costs of delays. Organizational structure that seemed to be amorphously performed from different quarters could have been performed from a more centralised position. The realisation of laxity by the management team resulted in guilt bearing and the subsequent resignation of top management players that changed the approach at Airbus. Since the management team bears the greatest responsibility on the performance of the company, it should have occurred earlier than it did for the turnaround of the company.

Flouted input-process-output model

Failure to employ the input-process-output model that integrates the various necessary stages of project operationalisation cost the delays in delivery of the first A380 unit. There was a difficulty and inadequacy of the management to identify the appropriate resources and funds that would sustain the project from the beginning to the end. There are schools of thought such as those postulated by Aboulafia et al (2004, p1) that the project was facing difficulties in funding the project to its full implementation to such an extent that state intervention was sought. Regarding the necessary combination of resources and information needed to launch a winning project strategy, Ilgen et al (2005, p517) propose an inclusive approach for the integration of behavioural and a cognitive support from all team players. The process element of the project was likewise differentiated into distinct sectors depicted from the different company approach. New product formulation and development strategies such as design, analysis and full launch lacked coordination. According to Boyer and Verma (2009, p75), organisational context, teams and tools were not introduced in the appropriate way. The French and German wings engaged in supremacy battles despite taking part in the most important and delicate process stage of software integration into the project. Output was delayed to such an extent that the initial timeline was seriously flouted to exceed the announced allowances. It appeared as if sustainability of the project was in a serious doubt.

Using well researched models such as process mapping could have assisted the Airbus consortium to manoeuvre beyond simple process timing hitches. Despite the massive technical muscle that the company had during the rolling out of the project, there is a missing link in the manner in which major steps in the project ought to have overcome operational challenges. According to Boyer and Verma (2009, p126), sticking to simple flowcharting and other process analysis techniques would have made the timing of the launch have a more realistic approach and avoid the embarrassing encounter as well as losses. Similar sentiments are held by Cohen and Rouisel, (2005, p183), to the effect that the mapping process benefits such as understanding the entire organisational capacity and cooperation levels.

Decision on Strategic Level; Tactical and Operational

Despite the initial awareness by the top management from the individual companies that the consortium would be operating as a single unit, there was lack of willingness to bring their resources together. According to Sores (2009, p1), the management remained focused on a convoluted arrangement in decision making which pulled the resources apart in the A380 project instead of converging their decision making capacities. It became a huge threat to the integrity of the consortium since the managers were acting antagonistically while the project demanded an opposite approach. In light of such an arrangement, decision making was slow and in an uncoordinated fashion. In the disintegrated version of operation, it was hard for the consortium to launch an operation that could handle such pressures as identity, integration as well as overcome conflicting interest from the various individual entities. Following such realities, the project A380 was under a serious threat unless the appropriate redesigning of the structure of administration as well as command emanating from the umbrella company was hastened.

The main business strategy at Airbus prompting the company to venture into the superjumbo business was largely to scale up its operations to rival Boeing. Apparently, the risk involved regarding launching an effective footing into the business needed a lengthy and thorough analysis which lacked in the Airbus ranks. The management at the helm of the project had tough decisions to make regarding the technical staff and personnel to involve, bearing in mind that the four subsidiary companies had internal strife. It became increasingly difficult as the management realised the magnitude of the divisions in the middle of the project which seemingly threatened the integrity of the system and operations plan.

From the organisational management perspective, Airbus had other challenges that needed to be tackled in advance; the lack of which occasioned the severe damage to success prospects. Organisational culture revealed that the system was marred by controversial relations inside the operations severely implicating elements such as; team roles, management focus, teams and unit integration, operations control, risk tolerance, reward criteria and internal conflict tolerance (Shore, 2009, p1). According to Chambers, Johnston and Slack (2010, p63) operations informed by strategic planning of projects is the solution to major challenges that stare in the face of implementation. Process strategy is intended to outline the flow of progress with a clear identification of the player thereby making it easy to handle non-performing areas of a project. Airbus did not have a firm strategy to deal identification breakdown and if identified, handling the standoff was not adequate.

Information Systems and Operation System Failures

Internal wrangles reported at the consortium could be handled the appropriate human resource management culture such that it would possible to handle differences and frustrations held by individual hard-liners. Employee motivation and commitment boosters proposed by Soft System Methodology (SSM) could be employed to facilitate the containment of the aggravating internal relations conditions. By considering the problem situation under the definition of the system opens the opportunity to unravel the effect of the problem on the integrity of the corporate objective. The SSM interpretation further enables the management to incorporate the actual system specific parameters to understand the appropriate formulation action plan for the problem.

Alternatively, by comparing other institutions that apply the employee-challenges resolving approach towards unlocking such standoffs, the SSM becomes in handy for real interpretation of the model. Contemplation of the competitors such as Boeing would have come in handy in salvaging the project A380. From such a perspective, the organisation can then formulate the appropriate changes that the system requires to launch a turnaround. Real solutions can then be formulated with the incorporation of the findings obtained by the methodology’s analysis. In light of the SSM postulates, very little action input from the management was employed to avert the adverse effects of the internal wrangles.

In addition to the SSM approach, the management team had other options to engage the condition of the internal strife such that the stakeholders were considered. Perhaps by cultivating the appropriate interest protection for the various stakeholders, the employees would have been reminded of their role towards meeting the objectives of the company (Checkland and Poulter, 2006, p12). Involving the best approach in terms of mentality and attitude by the employees, the standoff that nearly halted the A380 project would not have occurred.

In light of the benefits of the best attitude in tackling problems, the system at Airbus should have been considered and constant reminders be made a routine in case an employee’s blunder was to affect the operations of the organisation. Using the CATWOE model, issues of impact felt by various Airbus stakeholders are brought to light. The defining interest groups included in the model are; Clients, Actors and Owners of the project. Close consideration for the plan should highlight constraints and other barriers that would hinder project realisation such as Transformations or changes, the Worldview and possible support or dejection, as well as the Environmental constraints. Combining these factors formulates the CATWOE model which assists the management to formulate the appropriate position regarding finding the root problem and finding the solutions thereon.

Root definition under the SSM application provides insights that assist in management of operations and information systems within an organisation to the extent that the most important issues are brought out clearly for action. The benefits of such an analysis at corporation such as Airbus would be to formulate policies assisting organisational design. Were it not for the lack of the insights on SSM at Airbus, the organisational redesigning aspects of the project would have been the first step in the project implementation. Contrary to this expectation, the management decided to roll out the project before the organisational redesigning resulting in the incapacities that ensued. Alternatively, there was a problem in the technological aspects of the system at airbus since the information and communication system did not deliver the appropriate command flow.

The ensuing conflict from communication and command breakdowns made the condition difficult to handle for within the Airbus operations system. Such a hitch is observed in the inability of the consortium to effect a clear policy on the software to use in the project. Some schools of thought in the failure of the project propose that the CATIA software used during the project was not up to the task and needed an overhaul and redesigning (Shore, 2009, p1). The author reports and instance in the project when the wiring harnesses produced in Germany failed to be fitted into the plane under construction citing miscommunication. The CATIA version of technology at use in the project must have been identified as the main cause of the incongruence but more administrative factors played the centre stage.


According to the facts of the case study, there are clear areas of management that bear the largest responsibility on the massive losses that the Airbus consortium incurred under the project A380 implementation. In terms of availability of the appropriate information necessary to counter the adverse effects of the laxity in operation management, it appears that the management should have done a lot better. Project failure in the loopholes that were present in the consortium’s operations management was almost inevitable due to the magnitude of the missing cultural environment and management preparedness. Had there been enough and deliberate willingness to tackle the most pressing risks ahead of the project, the delays and the occasioned losses would significantly be evaded. Management roles in the effective operational and information systems employed at Airbus appear to bear a considerable amount of blame for the company’s shortcoming in projects such as the A380 project.




To incorporate the appropriate management elements at Airbus information system and operations, the necessary realignments must be considered. Three areas of interest must particularly be emphasised which include; technology, people and organisational issues. While the appropriate balance for all the three elements of management need organisational realignment is case dependent, the management must involve each of them to boost the chances of tackling possible adverse results from processes. Regarding technology, it is evident that the project A380 involved introduction of several technologies for initial testing in the project which was very sensitive (Aboulifia, 2002, p93). The appropriate realignment must address the issue of new technology involvement at such sensitive pilot projects due to high risks and uncertainties. Besides, the technical team involved in such a project must be integrated and coordinated from a central point. With respect to people and human resource management input needed at Airbus, internal wrangles must be wiped out to tap from the benefits of teamwork.

In light of organisational health, every sector of operations and processes must be inspired by a cohesive team. Human resource management at Airbus must involve a coordinated front which should take charge of all operational affairs for the company. With useful insights from the modern international human resources management practices, Airbus could get what the company needs to position itself in the dynamic human resource experience that it has. Alternatively, considering organisational restructuring for a more defined organisation at the helm of operations in the company could be what Airbus needs. Perhaps considering the introduction of a more structured management for all the four distinct companies could improve the organisational incapacity. A more cohesive organisational at Airbus would facilitate decision making and eliminate delays occasioned by secluded thinking.


  1. In the context of the input-process-output model, are staff considered to be…?
  2. a) a transforming resource


  1. What do the 4 Vs of operations management stand for?
  2. b) volume; variety; variation in demand and visibility


  1. What is an order-winning factor?
  2. b) A factor that is significant for the success of the organisation, if the organisation improves in this factor they will win more business.


  1. What does CRM stand for?
  2. d) Customer Relationship Management


  1. What kind of decisions does a DSS support?
  2. b) Unstructured decisions where there is no clear answer for tactical management


  1. If you discovered that a company finding that when one of their managers is away, nobody seems to know how to do their job or how to proceed with their work, what would system would you implement?
  2. d) KMS


  1. An ERP system is….
  2. b) A centralised database that processes the transactions of the organisation. It consists of modules like: manufacturing planning; finance; etc. It integrates processes and works across the functions of the business.


  1. What kind of problems is soft systems methodology most effective for?
  2. b) Problems were people and communication are heavily involved


  1. What does the CATWOE mnemonic stand for?
  2. c) Customers, Actors, Transformation, Weltanschauung, Owner, Environment.


  1. What are the three components of a root definition?
  2. d) why has the current problem come about; 2) how to solve the problem and 3) who can solve it.


  1. What does scientific management mean?
  2. a) Scientific management, or Taylorism, was about creating teams and providing flexible working to make the workforce more motivated.


  1. What does empowerment mean?
  2. a) Empowerment means more than autonomy, it means that staff have the ability to change how they do their job and the authority to make changes to the job itself.


  1. What does PDCA mean?
  2. b) Plan; Do; Check; Act.


  1. What does Pareto’s Law mean?
  2. a) 20% of something causes 80% of something else, e.g. 20% of customers can generate 80% of revenue


  1. What does this symbol mean in process mapping?
  2. a) Delay


  1. What does this symbol mean in process mapping?
  2. b) Storage


  1. Supply chain design decisions include…?
  2. d) all of the above


  1. Downstream supply chain management means…
  2. a) Managing the flow of materials to customers to enable order fulfilment


  1. What is the Gap model of quality?
  2. c) The gap between what the customer wants and what the organisation think the customer wants


  1. Project planning involves…
  2. a) Determining the activities involves; estimating how long they will take; establishing the relationships and dependencies between the activities and fixing a schedule.





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