Embracing Long-Term Competition With Boeing: Embraer's Strategic Approach

Introduction

Based on strategic approach manufacturers such as Embraer, it is possible to embrace long term competitions with top aircraft companies such as Boeing. Usually, giants companies such as Boeing and Airbus have a ground production process. This triggers a vital challenge for small companies to compete in the same field. In 2015, Embraer delivered about 101 commercial planes. On the other hand, Boeing and Airbus provide 762 and 635 commercial aeroplanes (Chiariniand da Silva 180). Based on this statistical data, there is a vast gap that exists between Embraer and Boeing. However, Embraer has its line, which assists in competing with other big companies.

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In contrast, Boeing and Airbus have a large economy of scale that helps the two companies to beat other competitors such as innovation, discounting as a way of fighting a competitive environment. Instead of fighting these large competitors, Embraer aims to focus on small planes where it is specialized - in this case, focusing on an area where the company is best to create an excellent competitive advantage. According to management, Embraer has identified that discretion is the best way of valour (Chiariniand da Silva 181). Even when the company decides to change the mode of a family jet, Embraer ensured that the most significant design retains smaller and lighter as compared to Boeing and Airbus. This condition forms an advantage to compete effectively in the market.

Based on the economic state in the world, it would be crucial for aeroplane companies to shift to small sets of suppliers. The short assessment will create economies of scale, and hence, companies will be in a position to save costs and improve their production. The application of a small set of parts would prevent high-cost plane companies from incurring an unnecessary expense as they try to sustain the demand rate. Additionally, the implementation of a small system will install the aeroplane companies with negotiation power. This concept will allow companies to feel they are in control of the production process (Chiariniand da Silva 179). As such, these companies will develop a positive approach that will ensure all production activities are arranged accordingly.

For many years, Embraer has been importing materials, which they use in the production process. As a way of enhancing its growth, the company should focus on producing its parts. Every year Embraer incurs a lot of costs when buying these materials. Instead, the company should use the capital to improve its production (Chiariniand da Silva 152). This may be an essential approach the company may use to compete effectively. Establishing a department that deals with parts production will be a vital way of boosting its production. In this case, the company can quickly produce various designs that will compete effectively in the market. Establishing a new plan will attract more customers who wish to enjoy the latest models.

Additionally, the establishment of the production department will ensure the company produces standard products based on the requirement. There are some cases that the company is supplied with low-quality products, and this affects service delivering. Additionally, the production system will give the company a background state which will produce based on the demand rate (Chiariniand da Silva 149). In this case, a company can produce different designs and models based on customers' demand.

Works Cited

Chiarini, Tulio, and da Silva, Ana Lucia Goncalves. "International Trade in Goods by Technological Intensity: The Brazilian Case, 1996-2010." International Integration of the Brazilian Economy. Palgrave Macmillan, New York, 2019. 143-185.