Organizational Transformation at Hughes Electronics Corporation
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Case Code: BSTR087 Case Length: 17 Pages Period: 1994 - 2003 Pub Date: 2004 Teaching Note: Not Available |
Price: Rs.500 Organization: Hughes Electronic Corporation Industry: Electronics & Communication, Countries : USA Themes: Business Environment |
Abstract Case Intro 1 Case Intro 2 Excerpts
Background Note
HEC's origins can be traced back to 1932 when the Hughes Aircraft Company (HAC) was formed by Howard Hughes Jr. (HH). This company was set up as a division of Hughes Tool Company, a machine tool business built by HH's father. HAC built racer planes - the first one built by the company was the H-1 racer. The H-1 racer was equipped with several innovative features that helped overcome many of the technical shortcomings of existing racer planes. It stabilized the airflow, flew at greater speeds and helped the aircraft glide safely in the air. Other interesting features of the new design were retractable landing gear, flush rivets and joints (used for joining different aircraft body parts), and a fully enclosed cockpit. At that time, HH's racer planes were regarded as an outstanding example of streamlining.4 In 1937, HH flew the H-1 and set a record for the fastest transcontinental flight. This event marked the beginning of HH's involvement in the avionics business.
During late 1930s, the company began building electronic systems and devices for space communication systems through Hughes Space Systems and other small ventures. In 1939, HH became the principal stock holder in Transcontinental & Western Air, Inc (TWA), a leading airmail and passenger carrier. He played a major role in finalizing the design specifications of the Boeing Stratoliner and Lockheed L-049 Constellation (both aircrafts used for long distance routes) which were acquired for TWA. In 1944, when the aircrafts were ready for testing, HH flew the Lockheed L-049 Constellation for seven hours without stopping, breaking his own previous record of the fastest transcontinental flight. The Lockheed L-049 Constellation was considered to be an advancement over the regular cross country passenger service airplanes as it saved the time wasted due to frequent breaks needed in between flights (for refilling fuel). During the early 1940s, HH and Henry J Kaiser, a well known ship builder at that time, came up with the idea of building a wooden seaplane which could be used in the ongoing Second World War...
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