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The Digital Skeptic: Dreamliner Brings iPhone 'Reliability' to the Skies

Tickers in this article: BA BAC

There is the excellent 2011 story by Michael Hiltzik of the Los Angeles Times that detailed the costly outsourcing mistakes with the 787, confirmed by the Harvard Business Review .

"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.