Boeing Is In Serious Trouble

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By Paolo von Schirach –

WASHINGTON – Boeing’s big troubles are not going away. At last, the Board got rid of Dennis Muilenburg, the CEO who seemed to personify the company’s ill advised self-assurance in the light of the seriously negative ripple effects caused by the two well-publicized crashes involving the 737 Max. But this “human sacrifice” seems to be too little, too late and it will not satisfy anybody. According to many, it seems that Boeing’s troubles run deep, way beyond the specific circumstances arising from technical malfunctions that seem to have caused the two crashes.

It seemed a manageable problem

At the beginning it seemed that we were dealing with a serious mechanical problem; but an isolated problem that affected one potentially defective system in one type of aircraft, the 737 Max. It was all about a software glitch that could trigger anomalous automatic adjustments in response to a sometimes defective sensor in the new 737 Max airplanes. Right after the crashes, Boeing’s reassuring reaction was that the problem had been identified and an adequate technical solution would be provided, in no time.

Because of Boeing’s reassurances, in the immediate aftermath of these accidents the accepted narrative was that, while these crashes were clearly bad news for Boeing, there would be an adequate fix which consisted in correcting the defect and then providing appropriate guidance and training to all pilots using the 737 Max around the world.

Most experts agreed that this fix should do it. Yes, Boeing had suffered a tremendous blow to its reputation and prestige as one of the two major civilian airplanes manufacturers in the world, (the other one being the European consortium Airbus); but, in time, it would be back to business as usual, and this stain would be forgotten.

Deeper issues

Well, without getting into the details, this relatively optimistic scenario did not and will materialize. And this is because these accidents triggered a stream of leaks followed by reluctant admissions on the part of Boeing that revealed how safety standards and protocols, testing of parts, cooperation between engineers and test pilots were not taking place according to the highest engineering and safety standards.

In other words, the picture that emerges, (although it may be exaggerated), is of a company that got so comfortable being number one in America and one of only two in the world that it allowed practices that were well below acceptable and agreed upon safety standards, al multiple levels.

Whatever we do must be good enough

In other words, we are getting a picture of a hubristic management whose main concern was to get products out of the factory as soon as possible, because the primary goal was to deliver airplanes as fast as possible to the customers, taking for granted that whatever safety standards the company was following, they had to be good enough.

FAA not yet convinced

Again, much of this is speculation; and it would be unfair to conclude that Boeing as a company was no longer concerned with high levels of safety. However, up to now the company has been unable to convince its US regulators, the Federal Aviation Administration (FAA), that it has made all the necessary fixes to the 737 Max and that it has implemented the highest quality safety protocols that will guarantee now and in the future safe airplanes, along with the best and most complete training programs for all pilots of all airlines, regardless of their nationality or seniority.

Indeed, as of today, there is no set date for the resolution of this gigantic problem. Without FAA certification the 737 Max cannot fly. Hundreds of airplanes produced by Boeing cannot be delivered to customers around the world. In fact, Boeing had to stop production of the 737 Max, since it has no idea as to when things will go back to “normal”, whatever thais means in these highly unusual circumstances.

Too big to do anything wrong?

I know that this is a bit of a stretch. But this level of corporate arrogance, if proven, makes me think of another major tragedy: the BP Deepwater Horizon explosion in the Gulf of Mexico in 2010 which resulted in the worst ecological disaster ever connected with oil exploration in the entire history of the US.

In that case, unsafe procedures were allowed which resulted in the explosion on the offshore platform, the loss of many lives, and the unprecedented ecological catastrophe that followed. Subsequent investigations revealed shoddy practices and lack of proper oversight. The difference is that BP, the oil company that ultimately got the blame, was not directly involved in the activities of its contractor; whereas here we are talking about Boeing’s internal procedures.

Still, it seems that being super big and successful allows smugness to ensue. You are so big and so strong that whatever you do, even when you cut some corners, must be right.

Leaks revealed serious issues

Well, tragically, it is not so. Even when you are number one, or perhaps because you are number one, safety and all proper procedures need to be strictly enforced. Belatedly, Boeing’s Board at last fired Dennis Muilenburg, the CEO who was in charge when the tragedies occurred and who has been saying ever since that everything would be in good order, in no time.

Unfortunately, while Muilenburg was trying to reassure shareholders and customers, all these revelations about relaxed procedures and lowered standards were leaked, this way causing serious additional damage to the company’s prestige and reputation. And so finally, as the CEO who seemed to personify a bad corporate culture, not to mention inadequate crisis management skills, he got fired.

FAA not reassured

But this is not nearly enough to reassure regulators, all the airlines domestic and foreign, that buy Boeing airplanes, and the flying public across the world.

Boeing’s number one objective must be to do whatever it takes to convincingly reassure all stakeholders that Boeing’s engineering and safety standards are second to none.

This may require extraordinary measures, such as hiring outsiders with a stellar reputation within the industry to go through all procedures and factory floor operations and certify them, or something like this. In other words, something really drastic must be done to recreate trust. Firing the CEO is just not enough.

Boeing is a national treasure

In the end, let’s look at the big picture. Let’s remember that Boeing is not just a big US company that makes civilian airliners, (ands a lot more, if we consider its space and defense divisions).

Boeing is an American national treasure.

It epitomizes the best of American innovation, technological prowess, ingenuity and complete dedication to quality by upholding the highest industry standards.

This was Boeing’s well deserved reputation until these two sad accidents and all the leaks and revelations that came out in their aftermath. Fairly or unfairly, Boeing’s reputation has suffered enormously. It is now up to its senior management to do their utmost to regain the confidence that has been compromised. Small fixes and reassuring press releases will not do it.

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