Boeing Regional Support Could Pay-Back with Sales
Business success anywhere in the world can often depend on a company’s willingness to serve local interests as much as on its ability to offer a good-quality product at a fair price. In the Middle East, perhaps more than elsewhere, a company’s product offerings best come with a readiness to help build a foundation for industrial and societal development. Boeing learned that lesson the hard way, as its past tendency to simply “parachute in” for sales resulted in some lackluster results over the years, particularly in the commercial realm. During the past five years, however, Boeing has worked hard to earn a reputation for good corporate citizenship in the region, and its effort has begun paying dividends, both in good will and commercial airplane sales.
The undertaking, at its most fundamental level, centers on an investment in so-called human capital, according to Boeing Middle East president Jeffrey Johnson. For example, the OEM’s involvement in the Middle East chapter of Junior Achievement, called Injaz, has just this year extended to the establishment in the UAE, Qatar and Kuwait of an “incubation” effort called Startup, a six-month job-shadowing and mentorship program for graduating university students. After completing the program, the budding entrepreneurs then pursue venture capital to start new businesses.
“We’ve worked over the last five years to change our thinking,” Johnson told AIN in a preshow interview. “We said we have to completely change the way we do business. Before we would sort of parachute in the teams, do the transaction, make a sale and then parachute out and then a team would come in and execute on the promises.
“We’re here in these markets forever, so we said let’s go change out behavior. Let’s go partnership, let’s go innovation around research and technology, let’s really weave ourselves into the fabric of the community with citizenship programs, with volunteer programs, with university relationships.”
Of course, Boeing’s motives are not entirely altruistic. In fact, one of the manufacturer’s most prominent partners in the region, Abu Dhabi’s Mubadala Strata, asked the U.S. company to get more involved in helping it develop young engineering talent. In response, Boeing established a university relations plan in which it has funded capstone programs for seniors at UAE University, Khalifa University and at higher colleges of technology.
“This is about…thinking long term and then acting like it,” said Johnson. “You weave yourself into the fabric of the community.”
As Boeing sees it, such community involvement not only earns it public relations points, but also develops a talent base into which it can tap in the future. Meanwhile, present-day partnerships with companies such as Mubadala, which makes carbon fiber parts for 777 tails and expects eventually to contribute composites for the 787, not only helps develop the UAE’s industrial base, but translates into good will with the country’s leaders, who ultimately buy Boeing’s products.
In Qatar, Boeing and the Qatar Foundation have teamed to establish a program centered on what Johnson called big-data analytics. “What we’re doing is taking our airplane health management algorithms and upgrading them again to be able to take the data that we have off the 777 and ultimately the 787 and really break through performance around predictions and health maintenance,” he explained.
Other countries where Boeing maintains a durable presence include Saudi Arabia and Kuwait, both of which have strong diplomatic ties with the U.S. Johnson praised the U.S. government’s efforts to encourage industrial cooperation as well.
“I think the U.S. has really stepped up the leadership they have at the embassies [and] the military leadership at central command,” he said. “We get great support out of the State Department, the Commerce Department, [the] White House, the Secretary of Transportation and ExIm [Bank]. It’s not perfect, but it’s the best I’ve ever seen in my over thirty years in the business. And it continues to get better.”