Lessons from Boeing’s 787 Dreamliner and 737 MAX: Outsourcing, Governance, and Safety

The global origins of the Boeing Dreamliner

A recent article by a team led by Prof. Michael Pecht, “Analyzing Boeing’s Supply Chain, Quality Control, and Certification Governance through the 787 Dreamliner Program,” concludes that Boeing’s strategic pivot to a decentralized, “system integrator” model introduced critical governance failures that ultimately compromised safety and production efficiency. Drawing on transaction cost economics, the study finds that extensive global outsourcing of safety-critical structures and systems increased coordination complexity, enabled opportunistic behavior, and strained Boeing’s ability to maintain consistent quality and oversight across its supply base.

The article shows how Boeing’s “light-touch” approach to supplier control, combined with an expanded reliance on delegated self-certification from the FAA, led to recurring quality issues, including fuselage gaps and shimming defects, nonconforming materials, and persistent manufacturing noncompliances. These issues, together with whistleblower accounts and regulatory actions, reveal a misalignment between production pressures and the requirements of a robust safety culture.

Impact of supply chain breakdown on aircraft safety

The authors argue that the 787 Dreamliner experience and its connection to the 737 MAX crises demonstrate the risks of treating complex aerospace programs primarily as cost- and schedule-driven outsourcing exercises rather than as tightly governed, safety-first engineering systems. The paper recommends renewed emphasis on hierarchical or tightly integrated governance for critical components, stricter, more independent regulatory oversight, and more comprehensive, data-driven quality management practices throughout the aircraft life cycle.

Prof. Michael Pecht is a leading authority in reliability engineering and risk assessment, with extensive experience advising industry and government on product assurance and system safety. As founder and director of the Center for Advanced Life Cycle Engineering (CALCE) at the University of Maryland, he has led pioneering research on electronics reliability, prognostics, and health management, bringing a rigorous, data-driven perspective to complex industrial challenges, as highlighted in this Boeing study.

Please contact Prof. Michael Pecht for information about the article and CALCE research.

Published January 14, 2026