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For Boeing, A New CEO — And The Same Unresolved Issues47:06
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In this Monday, Dec. 16, 2019, file photo, a Boeing worker walks in view of a 737 MAX jet in Renton, Wash. (Elaine Thompson, File/AP)
In this Monday, Dec. 16, 2019, file photo, a Boeing worker walks in view of a 737 MAX jet in Renton, Wash. (Elaine Thompson, File/AP)

Boeing used to have high safety standards. One recently revealed employee email said the company now has a "culture of 'good enough.'" What will it take to turn Boeing around?

Check out our past coverage of Boeing:

Guests

Lori Aratani, transportation reporter for the Washington Post covering airports and airlines. (@loriara)

Cynthia Cole, a test and systems engineer at Boeing for 32 years, until she retired in 2010. Former president of the Society of Professional Engineering Employees in Aerospace (SPEEA).

Leon Grunberg, sociology and anthropology professor emeritus at the University of Puget Sound. Co-author of "Emerging from Turbulence: Boeing and Stories of the American Workplace Today" and "Turbulence: Boeing and the State of American Workers and Managers."

Interview Highlights

When you were working on a system or project — and something got flagged for a bug, or a design flaw — how did Boeing deal with it? What was the process like?

Cynthia Cole: “I had to sign off on paperwork before we flew. And if I wasn't ready, I didn't sign off — and then we had to fix those problems. Most of the time we were so proactive. I mean, my job, I was on call 24 hours a day. I was the mission data expert. And I'd get calls at midnight. I just always left my phone on. And I would get calls at midnight if they were having a problem at shift change, and they needed some expertise. And I mean, we just worked whenever we needed to. And I can tell you, even though we worked wild and crazy hours … we just did it. We didn't have any attitude about it, because the most important thing was having a safe aircraft. And people worked together, and there would be disagreements. Yet, we would hash it out. You know, there was always this atmosphere of, ‘Let's get it to work, let's figure out what's wrong. Let's solve the problems.’”

"People worked together, and there would be disagreements. Yet, we would hash it out. You know, there was always this atmosphere of, ‘Let's get it to work, let's figure out what's wrong. Let's solve the problems.’”

Cynthia Cole

On what would happen if there were safety issues

Cynthia Cole: “I knew my own job, so I knew what I needed to do. And so on the military programs, we had incredible quality control. In fact, if there had ever been any incident on any of those aircraft[s], we would have known every single part — by serial number and part number — of any piece on that aircraft. We had such meticulous records. And so I knew what had to be done, and what was right for my part of the aircraft — and so did the other engineers. And, during those days at the Boeing company … we had process. We had incredible process, incredible procedures. You know, systems engineering at the Boeing company was like no place else I've ever been. And we had to document. If you couldn't document your process, step-by-step, you didn't have a process. And that was one of the things that made the Boeing company so excellent, was the systems engineering. And so we always thought, you know — schedule and cost, any profits and staying on track — that would follow, if you did the job right. The most important thing was doing the job right. And then the profits would come.”

“The most important thing was doing the job right. And then the profits would come.”

Cynthia Cole

On when she saw the company start to change 

Cynthia Cole: “It was after the McDonnell Douglas merger. It was during that time. And heritage Boeing engineers — we were shocked. We were appalled. We fought it. I mean, that was part of the reason for our 40-day strike. I was a picket captain, out on the strike. And that was part of the reason the McDonnell Douglas group, in management, they wanted to break our union. And it was really funny because we weren't really known as a strong union until they forced that strike, and we ended up winning.”

What was it about this McDonnell Douglas merger in 1996 and 1997 that changed the company culture at Boeing?

Leon Grunberg: “That’s the key question, I think. As Cynthia mentioned, they brought in a cutthroat culture with a new vision, and a new ethos. The two primary shareholders were John McDonnell, one of the McDonnell Douglas. And Harry Stonecipher, who was the CEO of McDonnell Douglas. So they became the largest shareholders. And essentially a lot of the top executives were imported from McDonnell Douglas. And what's really interesting is that in 2004, Stonecipher then became CEO of Boeing, actually made it very explicit that the intention was to change the culture. He said … that was the intention. ‘So that it’s run’ — this is a quote – ‘So it's run like a business rather than a great engineering [firm].’”

“As a lot of employers told us, the bean-counters, the finance guys, became the dominant people in the company. The ethos was to sort of chase shareholder value about everything. And that became the, sort of, that trickle-down across the whole management ranks. And that became the sort of dominant paradigm. And it led to a whole bunch of effects.”

On how the changes within Boeing impact production today

Leon Grunberg: “I think a good way to see the practical effects of the change is to look at a couple of airline programs, sort of contrast how the Triple 7 was built and launched, and the business model for the 787. And the Triple 7 took five years to build. It was launched in 1995. It was about $5 billion in cost. It's one of the safest planes. They had a ‘working-together’ philosophy that Cynthia has been talking about. They created what were called Design Build Teams, where engineers and manufacturing workers were co-located, so they would discuss problems as they arose from the design, and then the manufacturing aspects. And, apparently – amazingly — with 10,000 people working on that program. Alan Mulally, who was the head of that program, would bring altogether the 10,000 people that worked on that program three or four times a year, to avoid sort of silos; that people could talk and communicate to each other.

“And you contrast that with the 787, which was a new plane, the Dreamliner, was launched. Well, that was initially designed in 2003. That took eight years. It was over three years late. At this point, I think at one point, it was like $32 billion. Way over cost, overruns. It had a grounding of a few months because of battery problems. … Why did that happen? Why was the 787 business model a sort of flawed model? [It] was that Boeing completely outsourced a lot of the key parts of the plane, including wings. Which were, as one general manager told us, were the crown jewels of the Boeing production line. And so they start to outsource a lot of stuff to subcontractors. And they lost what they call configuration control of the supply chain. And they did that partly to try and minimize costs and to share risks with the subcontractors, with these partners. And of course the sad irony is — as I've just said — the decision to do that, to minimize risk and minimize cost, ended up doing exactly the opposite. You had huge cost overruns, and delays and a lot of risk in the building of the plane. And that's something you see developed with the 737 Max, too.”

“The decision ... to minimize risk and minimize cost ended up doing exactly the opposite. You had huge cost overruns, and delays and a lot of risk in the building of the plane.”

Leon Grunberg

From The Reading List

Bloomberg: "With Boeing’s Integrity in Doubt, New CEO Vows to Rebuild Trust" — "The opening gambits by Boeing Co.’s new boss show the risks he is willing to take to reset the deeply troubled planemaker.

"Dave Calhoun, who officially took charge Monday, pushed to release humiliating internal messages last week even though they may darken public perception for years to come — with Boeing’s own employees suggesting rot in a once-vaunted safety culture, and mocking designers and regulators on the ill-fated 737 Max. He also was heavily involved in the decision to drop Boeing’s long-held opposition to simulator training for Max pilots, said people close to the company.

"Those steps are just the start as Calhoun settles into a 36th-floor suite at Boeing’s Chicago headquarters, entrusted with turning around a company that has been widely censured for its arrogance, failure to take responsibility after two crashes killed 346 people, and unrealistic estimates of when the Max would be cleared to fly again. The bungling cost former CEO Dennis Muilenburg his job, and the bad news is far from over: Boeing is expected to reveal one of the largest writedowns in its history this month along with fourth-quarter results."

Washington Post: "Internal Boeing documents show employees discussing efforts to manipulate regulators scrutinizing the 737 Max" — "Instant messages and other internal Boeing documents revealed Thursday show company employees discussing efforts to ma­nipu­la­te U.S. and international safety regulators.

"'Yes, I still haven’t been forgiven by god for the covering up I did last year,' said a 2018 message.

"Another exchange between Boeing employees, from August 2015, closes out with this: 'I know but this is what these regulators get when they try and get in the way. they impede progressw' [sic]

"In 2017, a Boeing employee wrote: 'this airplane is designed by clowns, who in turn are supervised by monkeys.'

"The documents were released by Boeing to congressional investigators probing how the company’s 737 Max jets were certified by the Federal Aviation Administration as safe before two crashes that killed 346 people."

BBC: "Boeing faces fine for 737 Max plane 'designed by clowns'" — "US regulators are seeking to fine Boeing $5.4m (£4.14m) for 'knowingly' installing faulty parts on 737 Max planes.

"The move comes after the release of internal messages that raised more questions about the jet's safety.

"In one of the communications, an employee said the plane was 'designed by clowns'.

"Boeing has been under scrutiny since the fatal crashes of two 737 Max planes, which killed 346 people."

This program aired on January 14, 2020.

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