Boeing needs new leadership to restore culture of safety

This article originally appeared in the Puget Sound Business Journal’s “Wright on Center” column on October 15, 2019.

From its perch in Chicago, Boeing leadership was isolated from its workforce and detached from reality. Its current dilemma, how to rebuild a culture of safety that has languished, is insurmountable without changes at the top. That was evident in the repeated failings of the company to acknowledge and address the company’s safety crisis.

Stripping CEO Dennis Muilenburg of one title while letting him remain at the top of the company is another demonstration of the company’s failure to take its situation seriously.

In late October, one year ago, Lion Air Flight 610 crashed into the ocean. Fewer than five months later, a second 737 Max 8 would crash, Ethiopian Airlines Flight 302. Throughout the ensuing crisis, Boeing continued to fail its employees, its shareholders, and its community.

A board of directors has more than a fiduciary responsibility, it has a "Duty of Care," which has not been provided. Boeing needs to recenter its moral compass and return to its roots. Recently, a whistleblower’s complaint was revealed, alleging that Boeing ignored safety concerns that would have potentially added costs and delayed schedules, but may have prevented both crashes. Other reporting highlighted Boeing’s continued partnerships with shoddy airlines churning out ill-equipped pilots through “feeder facilities” around the world.

At the root of its problems is a company hobbled by soulless leadership. Boeing’s ongoing “solution” to this crisis is to have the leadership team responsible for the current problems to study and implement their own solutions. This is akin to asking the fox to keep watch over the henhouse.

For months, a subcommittee of Boeing's board had been studying ways for reforms within its internal safety reporting structure. That subcommittee included the CEO, a former nuclear submarine officer, and a systems analyst, each of whom is also on Boeing’s board of directors.

At the end of September, it was announced that all recommendations created from that study would be implemented and a new organization, again by appointed the company's current leadership, would be created to “unify safety-related responsibilities.” This new team would be headed by a 34-year veteran of Boeing — a vice president who previously led safety, security, and compliance for Boeing Commercial Airplanes.

To put it bluntly, the leaders responsible for the culture that created Boeing’s current mess are the same individuals leading the efforts to get them out of it.

Common sense would call for an independent outside commission, with experience in dealing with inbred systemic malpractice, to weigh in on findings. Insularity like this is far more likely to produce an echo chamber that lacks dissent than it is to produce sound recommendations that can survive the push and pull that comes from reasoned and impassioned debate.

There are human components to leadership, which are sorely lacking at Boeing. As a company receiving government contracts and subsidies, it has a social responsibility to have a culture built on integrity, transparency and above all, accountability. The 737 Max 8 crisis has its roots in a company that shifted away from the people and communities it serves, to one with a singular focus on the bottom line. It is a cultural failing that has manifested itself in the Max crisis, and undoubtedly, permeates all levels of the organization. This is something that board-appointed subcommittees cannot fix.

In August, the Business Round Table updated its statement of purpose to restate what corporate responsibility means in America. It promises a larger focus on employees, customers, vendors, communities and shareholders. It said that the old days of singular focus on shareholder returns were over.

Boeing’s CEO signed this promise. These feel like empty words based on Boeing’s recent behavior.

Boeing is irresponsible in its drive to sell aircraft to airlines with ill-trained and inexperienced pilots. As Andrew Ross Sorkin states in “Sociopaths in the Boardroom,” when a company is only driven by shareholder return, “It’s pretty close to a textbook case of antisocial personality disorder.”

It is time for the board to change out its CEO.