Boeing, Inc. is one of the largest manufacturing companies in the world. It produces airplanes, communication equipment, and other specialized technology for governments and large corporations. Most of these items are made-to-order and contracted years in advance.
The commercial aircraft industry forecasts are measured by the number of people flying each day or week between two points. Air transportation providers then try to match their flight schedules to it at the lowest cost. This might mean a few direct flights with a small plane, or more flights with layovers on large planes.
Changes in the number of flyers are not required for companies to order more airplanes. They need to simply add value to the airline. Replacing a propeller with a small jet can win over people who do not like to fly. Larger planes are overly costly if they do not run mostly filled. Yet having several flights at a time between cities costs extra fuel and airport fees. Long-range planes that can fly quickly will win over finicky consumers. The key is balance.
Boeing needs to study the industry and then come up with planes to meet the changes. This can mean changing mid-stream. The company abandoned a super-fast jet when fuel prices began to rise. It also means having a variety of products available to fall back on when some parts of the industry dip.
Government contracts are another major source of business for Boeing. Here forecasting is a matter of lobbying and working with designers and decision makers. When contracts come up, they can bid on them effectively because they know what aspects are most important to winning the contract.
Budgets are very much a top-down process at Boeing. Each project is sufficiently large to justify job-order costing. Furthermore, either the customer or Boeing management may decide to delay delivery for a number of reasons. Unlike its competitor Airbus, Boeing outsources nearly all of its componen...