There are times when it seems everybody wants to emulate Apple, which isn’t anything new. On the other hand, the case was different when Boeing’s leaders recently said the company would be more like Apple.
Speaking to Wall Street analysts at an annual meeting last week, Boeing Chief Executive Officer Jim McNerney said the company wanted to be more like Apple in the way it innovates, rather than doing a “moon shot” development every 25 years, Reuters reports. Dennis Muilenburg, Boeing’s chief operating officer, expanded on the Apple comparison, saying Boeing’s forthcoming 777X jet was an example of using “evolutionary” technology steps to deliver a “revolutionary” product.
"We’re still going to deliver revolutionary capability,” Muilenburg said. “The way we deliver is to build on technology we have. We get to the same end point if you take 10 low-risk, well-managed steps rather than one big step.”
Actually, the announcement isn’t surprising. After spending billions of dollars on the 787, addressing downward pricing pressure from airlines demanding “more for less” and facing continued cutthroat competition from Airbus, it makes sense. That’s why Boeing will focus on reducing costs, introducing innovation only in incremental steps, and where possible, “replicating systems and technologies already proven and paid for,” to develop new airplanes, McNerney says, according to a Seattle Times article.
Toward that end, the company will ask top engineers to reuse already developed technologies on new platforms rather than starting from a blank sheet and making everything new, says Muilenburg. In the past, Boeing has had best engineers working on the new thing. Moving forward, the best engineers will be working on innovative reuse, he said.
The plan then is that by focusing on producing new airplanes more efficiently and cheaply, Boeing will be able to achieve several notable business objectives. For example, the company is working to cut $2 billion in structural costs from the company’s defense business and improve its market share in the single-aisle aircraft market—where it has about a 50 percent market share. Boeing also plans to extract cost savings from its suppliers, which represent as much as 70 percent of the company’s costs, says Muilenberg, the chief operating officer.
Boeing, of course, isn’t alone in feeling the heat of the prolonged business environment. Indeed, Tom Enders, chief executive at Airbus Group, expressed similar thoughts at the Berlin Airshow last week.
The industry can no longer afford to “bet its shirt” on game-changing projects that “lead to a crazy game of chicken with the competition and leave nothing to pay the bills,” Enders said, according to a Reuters report which ran in the Chicago Tribune.
Coming out of some bruising years, I can see why companies are thinking of reusing innovation. But there is something about Apple’s strategy that stands out. Yes, the company does regularly roll out new versions of existing products, and each new version is an evolutionary development.
However, more importantly, Apple developed the iPod, iPhone and iPad. Sure, there were, and have been, other versions of music players, smartphones and tablets. But it has been the Apple products that have been the most successful and defined the market. There clearly has been technology carryover as well, so there are similarities among Apple devices. In the end though, such innovation reuse isn’t possible without first, clear and definitive innovation, and second, market dominance.
All of which certainly isn’t to imply that Boeing or Airbus cannot successfully reuse carbon fiber technology or new engine designs to achieve their objectives. It is worth noting though, that while Apple’s strategy sometimes looks deceptively simplistic, in reality, it’s much more complex—and even more difficult to successfully execute.
What are your thoughts on innovation? Is your company using evolutionary technology to create revolutionary products?