Complete 3 page APA formatted essay: Review of any: Production and Procurement in the Aviation/Aerospace Industry.Download file to see previous pages… Both firms experienced problems with regards to.
Complete 3 page APA formatted essay: Review of any: Production and Procurement in the Aviation/Aerospace Industry.
Download file to see previous pages…
Both firms experienced problems with regards to this particular strategy. For instance, both firms had to struggle with quality problems and repeated delays (Rosar, 2013). Therefore, outsourcing of production has its pros and cons. However, in the large aviation industry that specialises in manufacturing large aircraft, it can be seen that this strategy has certain negative impacts such as maintenance of quality. On the other hand there is a payoff where the seller can be favoured by the buyers through a procurement mechanism. According to this article, the buyers are likely to be interested in procuring goods produced in house since these are characterised by quality compared to those which are produced using outsourcing methods. The procurement mechanism determines the factors such as: who has to produce and what payment has to be made. Through procurement strategy, quality is maintained. Therefore, products produced in house are associated with quality while those produced through outsourcing are not favourable to buyers. Therefore, procurement management is essential in the large aircraft industry where quality issues ought to be given priority. Outsourcing production in this particular industry may not be a very wise decision since this may compromise on quality. This will negatively impact on the organization in the long run if the customers are not satisfied with the quality of the final product offered on the market. Analysis of the article It can be noted that companies involved in the aviation/aerospace industry are somehow forced to ether procure the equipment they require in their work from other companies or they need to outsource their production to the other third part actors in the same industry. In this industry, it can be noted that outsourcing production is advantageous especially on small scale industries. The main reason behind this assertion is that costs are likely to be shared among the companies that have been delegated to produce the desired parts for the aircraft. Basically, outsourcing is a strategy that is designed to minimise costs in as far as production of different parts required for manufacturing aircraft is concerned. However, a critical analysis of the above mentioned article has revealed that this strategy can be costly since it can backfire on the company that has outsourced its production of aircraft parts to the third party. It may be difficult for the company involved to maintain quality since it is not in a position to control and monitor the production process. The result is that the quality of the final product is likely to be compromised which can also negatively impact on the interests of the customers who will purchase the final product. On the other hand, it can be observed that the process of project procurement management is also very important in the aviation and aerospace industry. Basically, “Project procurement management includes the processes required to acquire goods and services, to attain project scope, from outside the performing organization,” (Fleming, 2003, p.1). In small aviation industries, it may be wise to use the strategy of procurement from outside sources since this helps the company to have a wide selection choice from what is available.