And it all seemed like a brave new world of efficient air transport, save for one scrupulously well documented trend: Based on published documents, Boeing struggled mightily to manage the information needed to actually build the 787.
Lost in a cloud of data
The documentation of data gone wild with this plane is almost a cottage industry among journalists, analysts and academics. Serious A-list professors such as Ravi Anupindi of the University of Michigan, who did a fascinating breakdown on how sourcing thousands of cheap assembly parts confounded Boeing.
"Boeing agreed not only to outsource an unprecedented amount of the plane's parts to partners in Europe, Japan and China, but also to transfer to them unprecedented know-how," Dick Nolan wrote in a 2009 Review post.But to me, the most readable, earnest -- and frankly, terrifying -- telling of how humans were lost in the big data skies is told by an Eller College of Management student at the University of Arizona named David Mahmoodi. In 2009, working from public documents, he wrote a paper called Outsourcing of the Boeing 787 that is a must-read for any investor. Mahmoodi breaks out the grim details of how an Italian subcontractor hired to build the fuselage actually shipped thousands of fasteners in crates instead of installing them in the plane. Or how Boeing struggled to properly engineer its outsourced parts among global production teams "[I don't] think it should be pushed on the inexperience of the mechanics," was how Joy Romero, vice president of Vought Aircraft Industries, which supplied parts to Boeing, was quoted by Mahmoodi. "It's more about the clarity of the specifications." Given this level digital confusion, Sheth confirms it is more than fair to wonder if the batteries are not the only issues lurking in the 787. "The things with these batteries is, there were never any other problems in the past. And it erupted like a volcano," Sheth said. "It could be anything." No reboots at 35,000 feet
Sheth wants to be clear. Key customers continue to take delivery of the 787s and he believes Boeing will find an answer to its battery woes. But consider this: At least based on the picture painted by public documents, the 787 is not only as complex as any other modern integrated software and hardware device -- say, an iPhone, a Surface tablet or a Prius. It is more complex. That means real-world trial and error debugging will almost certainly be required to smooth out the 787's kinks. But unlike Priuses, iPhones and Tablets, there is no culture of recalls, updates and reboots in aviation. With the Dreamliner, the beta testing gets done at 35,000 feet. "We are in uncharted territory," Sheth said.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV