Electronic Commerce – Application Case: Boeing’s spare PART marketplace
Boeing was motivated to create PART in order to improve customer service, specifically for maintenance needs and spare parts. Prior to the establishment of the PART marketplace, customers faced a complicated and expensive process to obtain the specific parts they required. Orders for these parts were placed via telephone or fax, which required Boeing to allocate significant resources to manage approximately 600 daily phone calls.
The establishment of EDI connections with Boeing over VAN's caused administrative errors and incorrect deliveries, leading to increased costs. Initially, only major airlines utilized this complex and expensive system while the majority of airlines chose not to use it. However, Boeing recognized the internet's potential for reaching a larger customer base in a more cost-effective and efficient way. The successful implementatio
...n of the PART system also contributed to customer satisfaction and may have influenced their decision to purchase Boeing aircraft. The shift from EDI to internet-based ordering was driven by the fact that prior to 1992, only 10 percent of the largest customers were using EDI for parts ordering.
The primary factors contributing to this underwhelming performance were the exorbitant costs and intricacy associated with VAN-based EDI. The internet, on the other hand, offers effortless and cost-effective accessibility. Recognizing this potential, Boeing sought to facilitate electronic part orders from a wider range of customers. Consequently, not just major airlines but even the smallest players in the industry could now partake in PART. Enumerate and briefly explain the advantages of PART to Boeing.
Boeing was able to save costs by establishing PART because they didn’t have to spend as much on labor for managing phone call
or administrative work. With the help of PART, Boeing was able to improve customer relationships by encouraging more customers to order parts electronically, resulting in higher customer satisfaction. PART also helped ensure Boeing's leading position on the global market by contributing to its good reputation and image, making potential customers more willing to make aircraft purchases. The use of PART and the webpage allowed for multiple orders to be analyzed quickly, avoiding administrative errors. Below is a list and brief discussion of the benefits of PART to Boeing's customers:
Customers now have access to higher quality and more readily available information. They can easily access up-to-date part information, including prices, availability, interchangeability, and even perform partial part number searches. The internet has greatly contributed to this improved quality of information, allowing for real-time updates. Additionally, the use of internet and PART has made it possible for even smaller companies to electronically order parts, whereas previously only the largest airlines could afford the expensive VAN-based EDI system.
Improved order system allows customers to order 25 items at a time and make changes or additions to their orders without the need for extensive phone calls. In cases where personal assistance is required, PART provides customers with contact information. Additionally, frequently asked questions (FAQ) help resolve many uncertainties. By using PART, the order process becomes faster and more accurate compared to traditional methods involving telephone or fax, which are prone to human error. The handling of PART is simple and intuitive, ensuring that even first-time users can save time and minimize mistakes.
The customer incurs no costs except for local internet access, making it a cost-effective communication and business option. Additionally,
customers can easily monitor their orders online and stay updated on the status of their tasks.
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