Will/Should Boeing Have a Top Management Change?

SuperGee · Wed Apr 24, 2019 1:26 am

Apologies if this has already been discussed but the existing Max and 787 threads have become so humongously large they are difficult to read entirely and searching on them didn’t lead me to any existing discussion.

For the same reason, I thought that a new topic was warranted for this discussion. If it more correctly belongs on one of the existing Boeing threads, please feel free to move it.

It seems to me that with all of the MAX problems and now the alleged issues at the Charleston 787 plant, there must be some seats in Boeing upper management (right up through the CEO) that must be getting pretty warm by now. This has to be one of the biggest crises in the company's history and they are clearly up against it. I could see the decision makers saying “we’re in a real mess but the guys that are in there now know the place better than anyone else and are the best ones to stay there and lead us out of it."

On the other hand, I could also see them say “the guys that are in there now got us into this mess and it’s time for some new blood at the top”. I know that there have already been changes in engineering and other staff positions because of the MAX problems but does anyone see any changes coming at Boeing upper management as well?

exFWAOONW · Wed Apr 24, 2019 1:41 am

Boeing hasn’t been the same since McDonnell Douglas bought them with their own money. These are the the same managers that made the MD11 a short-lived plane by not updating the wing to save a couple of dollars. I won’t shed a tear to see them depart.

BoeingGuy · Wed Apr 24, 2019 1:52 am

Lets be clear. There is a fairly new CEO who I believe is better than the past few.

It was Phil Condit, Harry Stoneciper, and Jim McSlimeball that did so much damage.

McNerney’s gutting of organizations and moving them out of state has caused stuff like the 777X FCOM being a disaster.

The decline pre-dated the Douglas merger. Selling off the pilot and maintenance training department to a “joint venture” in March 1997 was an idiotic move, after the employees begged them not to do it. As with many of these bad decisions, it cost more money than they saved and trashed the quality of training.

Same with the 787 and KC-46 disasters. Great airplanes, but incredible incompetence from the top. In the quest to cut costs, it cost the company far more.

I could go on for hours about how angry and frustrated Boeing employees are with the years of bad management by people who are more interested in lining their own pockets off the backs of the employees. Benefits and retirement have been cut way back, while McSlimeball gave himself over $300,000 a month in pension.

It’s also Wall Street’s fault. While McNerney is damaging the company, the stock price is growing like wildfire.

Having said all this, I’m willing to give Dennis a chance. I don’t think he should be fired. I’m supportive of Kevin so far too. They inherited years of bad management. They didn’t cause it.

BoeingGuy · Wed Apr 24, 2019 1:53 am

exFWAOONW wrote:
Boeing hasn’t been the same since McDonnell Douglas bought them with their own money. These are the the same managers that made the MD11 a short-lived plane by not updating the wing to save a couple of dollars. I won’t shed a tear to see them depart.

Name one current Boeing leader who had anything to do with MD-11 design decisions.

TheFlyingDisk · Wed Apr 24, 2019 1:59 am

Bring back Alan Mulally. Maybe not as Muilenburg's replacement, but as chairman while he continues being the CEO.

BoeingGuy · Wed Apr 24, 2019 2:03 am

TheFlyingDisk wrote:
Bring back Alan Mulally. Maybe not as Muilenburg's replacement, but as chairman while he continues being the CEO.

I have mixed feelings about Alan. I’ve heard some mixed reviews from mid level engineering executives who interfaced with him. Market share also went way down under his watch. Clearly he did some good things too.

BoeingGuy · Wed Apr 24, 2019 2:06 am

SuperGee wrote:
Apologies if this has already been discussed but the existing Max and 787 threads have become so humongously large they are difficult to read entirely and searching on them didn’t lead me to any existing discussion.

For the same reason, I thought that a new topic was warranted for this discussion. If it more correctly belongs on one of the existing Boeing threads, please feel free to move it.

It seems to me that with all of the MAX problems and now the alleged issues at the Charleston 787 plant, there must be some seats in Boeing upper management (right up through the CEO) that must be getting pretty warm by now. This has to be one of the biggest crises in the company's history and they are clearly up against it. I could see the decision makers saying “we’re in a real mess but the guys that are in there now know the place better than anyone else and are the best ones to stay there and lead us out of it."

On the other hand, I could also see them say “the guys that are in there now got us into this mess and it’s time for some new blood at the top”. I know that there have already been changes in engineering and other staff positions because of the MAX problems but does anyone see any changes coming at Boeing upper management as well?

By the way, I think this was a very valid topic for you to start. Hopefully it will foster some interesting discussion.

ubeema · Wed Apr 24, 2019 3:17 am

Good topic. If one looks at this chart without knowing what has transpired in the last 6 months, it’s hard to realize so much is going on. Coincidentally the stock price today ended exactly with the number of 7M8 in operation at the time FAA announced its grounding! Also just a little higher than the number of fatalities in both airliners. Annual shareholder meeting is coming up 4/29, perhaps that will reveal news about DM’s future. IMO unless the crisis go through some major mismanagement I think he is going to make it.

crownvic · Wed Apr 24, 2019 3:40 am

Just an armchair response, but if this were any other corporation in the U.S., heads would be rolling. Whether the current CEO had anything to do with issues on the Max, KC-46, Apache and 787 programs, he is in charge now and somebody should be held accountable for the same reasons LOTS of heads have rolled at Airbus for similar debacles.

jetblueguy22 · Wed Apr 24, 2019 3:56 am

Wall Street likes the current management, even throughout the grounding they’ve demonstrated they aren’t abandoning them. That says a lot when the company is in crisis mode.

Veigar · Wed Apr 24, 2019 4:01 am

exFWAOONW wrote:
Boeing hasn’t been the same since McDonnell Douglas bought them with their own money. These are the the same managers that made the MD11 a short-lived plane by not updating the wing to save a couple of dollars. I won’t shed a tear to see them depart.

I strongly doubt any of the things we're having issues with today go as far back as McDonnell Douglas. lol

ELBOB · Wed Apr 24, 2019 5:33 am

Veigar wrote:
I strongly doubt any of the things we're having issues with today go as far back as McDonnell Douglas. lol

The current institutional problems are the legacy of decisions of people like Harry Stonecipher who came from... guess where?

And the first 7E7 / 787 Program Manager, Mike Bair, stated clearly that the outsourcing approach used on that project was copied from MDC's approach for the MD-95 which had such ridiculous contracts such as Hyundai building wings, which they'd never done before. He continued:

(The 7E7 model) is very similar to the way we are managing the 717 program," Bair said. "It's clearly given us some experience in how to manage a program a little differently than we have in the past.

Yeah, let us know how that works out...

Boeing's management culture changed totally in 1997 and they're now paying the cost.

SuperGee · Wed Apr 24, 2019 12:28 pm

Profits down 21% because of MAX crisis. That will get somebody's attention....well, it should anyway:

https://www.cnn.com/2019/04/24/investin ... index.html

BoeingGuy · Wed Apr 24, 2019 3:41 pm

ELBOB wrote:
Veigar wrote:
I strongly doubt any of the things we're having issues with today go as far back as McDonnell Douglas. lol

The current institutional problems are the legacy of decisions of people like Harry Stonecipher who came from... guess where?

And the first 7E7 / 787 Program Manager, Mike Bair, stated clearly that the outsourcing approach used on that project was copied from MDC's approach for the MD-95 which had such ridiculous contracts such as Hyundai building wings, which they'd never done before. He continued:

(The 7E7 model) is very similar to the way we are managing the 717 program," Bair said. "It's clearly given us some experience in how to manage a program a little differently than we have in the past.

Yeah, let us know how that works out...

Boeing's management culture changed totally in 1997 and they're now paying the cost.

As I mentioned, I believe the downfall started even before the merger. The Training division disaster predated the merger. It was just incompetent management to do that. Then they lied to the press and congratulated themselves for doing such a great job.

DCAC was also a disaster, as was DeHavilland. All predated the merger. All incompetent and insincere leadership.

However, I agree the merger perpetuated the decline.

9Patch · Wed Apr 24, 2019 4:07 pm

SuperGee wrote:
Profits down 21% because of MAX crisis. That will get somebody's attention....well, it should anyway:
https://www.cnn.com/2019/04/24/investin ... index.html

"The stock market took the news in stride; pre-market trading saw Boeing stock rise more than $6 (1.66%) an hour before opening."

"The MAX was grounding March 13, affecting only two weeks of the first quarter. The full impact is to come. As a result, Boeing suspended guidance for the year and will reissue it at a later date."
https://leehamnews.com/2019/04/24/boein ... more-29960

Revelation · Wed Apr 24, 2019 4:10 pm

Will/Should Boeing Have a Top Management Change?

Boeing's crisis management strategy is pretty clear, limit the damage by saying things like we met all the regulations and only erred by putting too much workload onto the pilots, and channeling the energy into the MCAS fix and diverting it away from anything like a broad ranging review of Boeing's engineering processes and/or its role in the certification process.

In the short term this means no heads will roll, since they need everyone to stay on board as much as possible while the bright lights are pointing at them.

But once things cool down, scapegoats will be found. Promising careers will be blunted. Certain people will be shunted from leadership rolls and into what is called the "penalty box" in corporate speak. Those people will either leave or find shelter in some sort of lower profile role.

crownvic wrote:
LOTS of heads have rolled at Airbus for similar debacles.

Tis true. Charles Champion was the face of the A380 project while things were going well, then after the wiring disaster he was shunted off to some sort of nebulous tech leadership role.

WayexTDI · Wed Apr 24, 2019 4:13 pm

Should Boeing have a change in upper management? Yes.
Will Boeing have a change in upper management? I doubt.

Aesma · Wed Apr 24, 2019 4:22 pm

Is there a criminal investigation in the US over the 737Max crashes ?

robsaw · Wed Apr 24, 2019 4:30 pm

Aesma wrote:
Is there a criminal investigation in the US over the 737Max crashes ?

I'm not aware of any directly associated with the MAX crashes but there is a US Justice Department investigation into Boeing's Federal Aviation Administration certification and marketing of 737 Max planes, which could lead to criminal indictments.

elbandgeek · Wed Apr 24, 2019 4:37 pm

jetblueguy22 wrote:
Wall Street likes the current management, even throughout the grounding they’ve demonstrated they aren’t abandoning them. That says a lot when the company is in crisis mode.

A solid argument for society as a whole to stop treating stock value and "what wall street thinks" as any sort of valid measuring stick

"Yeah, 300 people are dead because of cutting corners but some rich people got slightly richer so it's all good"

BravoOne · Wed Apr 24, 2019 4:49 pm

robsaw wrote:
Aesma wrote:
Is there a criminal investigation in the US over the 737Max crashes ?

I'm not aware of any directly associated with the MAX crashes but there is a US Justice Department investigation into Boeing's Federal Aviation Administration certification and marketing of 737 Max planes, which could lead to criminal indictments.

I believe there is in fact a criminal probe by the FBI. I know of several people that are awaiting, or have been "interviewed" by the FBI within the last ten days.

There are several departments that could use a good scrubbing, namely Flight Technical and Flight Training Development, along with moving Flight Training back to Seattle where it belongs. To do that, several people would have to admit previous errors and that will never happen.

SurlyBonds · Wed Apr 24, 2019 4:59 pm

BravoOne wrote:
There are several departments that could use a good scrubbing, namely Flight Technical and Flight Training Development, along with moving Flight Training back to Seattle where it belongs. To do that, several people would have to admit previous errors and that will never happen.

I don't particularly claim to have a dog in this fight, but advocating "moving Division X back to Seattle where it belongs" strikes me as addressing someone's pet peeve.

Can you provide a logical business case as to why Flight Training *must* be in Seattle, and nowhere else?

Canuck600 · Wed Apr 24, 2019 5:35 pm

There should be a middle management/department head change as well. Starting with whoever made the promise that the max could be made to handle like the previous generation (Sales?)

ltbewr · Wed Apr 24, 2019 5:46 pm

Clearly there has been a culture change at Boeing, in parts due to the competition with Airbus, high operational and labor costs especially in the Seattle region and other West Coast facilities, the need to cut costs to keep high levels of quarterly profits and the stock price high. Yes, once the MAX crises has passed, many of the top executives should be dismissed or forced into early retirement, replaced with persons who will run Boeing as it should be to make everyone from the CEO on down doing their part.

BravoOne · Wed Apr 24, 2019 5:51 pm

Well for starters they little no customers for wet training down in MIA. Most of it is dry training. Asians which are a large part of the customer training base do not want to travel to MIA. If the Boeing flight crews need landings for currency or any other training or evalautuon work they need to travel from SEA to MIA or LGW in some cases. Not to mention the value of having a FFS for various training evaluations where the manuals are written. I have seen pilots go as far as Singapore for landings. Ridiculous! BTW, they travel Business class and stay at good hotels with a generous expense allowance. Probably five days minimum for a one hour event. Don't even get started on the crap they by for simulators.

This is not my pet peave as I no longer have dog in the fight but the average 3rd grader could have made a better decision than the ones that were made five years ago. Of course the person who did this is long gone with her bonus intact.

cledaybuck · Wed Apr 24, 2019 5:53 pm

exFWAOONW wrote:
Boeing hasn’t been the same since McDonnell Douglas bought them with their own money. These are the the same managers that made the MD11 a short-lived plane by not updating the wing to save a couple of dollars. I won’t shed a tear to see them depart.

How is Muilenburg, a Boeing employee since 1985, part of the management responsible for the MD11?

MRYapproach · Wed Apr 24, 2019 7:13 pm

Check out the Aviation Week podcast from March 7. Many interesting sub-topics on this show about the Boeing NMA, but I found the part about 95% of free cash going into the dividend that Wall Street expects to grow...pretty much forever...means that management's hands are kind of tied. Not sure how long this pattern has been going, but these shareholder demands seem to have driven many of the recent bad moves by Boeing already mentioned here. Until those that have the real leverage (shareholders) begin to put some focus on long-term decisions, I doubt things will get better for Boeing. It's hard to imagine something as era-changing as the 777 coming from Boeing anytime soon. Even something on the level of the 787 seems far fetched.

PSAatSAN4Ever · Wed Apr 24, 2019 7:25 pm

BoeingGuy wrote:
Lets be clear. There is a fairly new CEO who I believe is better than the past few.

It was Phil Condit, Harry Stoneciper, and Jim McSlimeball that did so much damage.

McNerney’s gutting of organizations and moving them out of state has caused stuff like the 777X FCOM being a disaster.

The decline pre-dated the Douglas merger. Selling off the pilot and maintenance training department to a “joint venture” in March 1997 was an idiotic move, after the employees begged them not to do it. As with many of these bad decisions, it cost more money than they saved and trashed the quality of training.

Same with the 787 and KC-46 disasters. Great airplanes, but incredible incompetence from the top. In the quest to cut costs, it cost the company far more.

I could go on for hours about how angry and frustrated Boeing employees are with the years of bad management by people who are more interested in lining their own pockets off the backs of the employees. Benefits and retirement have been cut way back, while McSlimeball gave himself over $300,000 a month in pension.

It’s also Wall Street’s fault. While McNerney is damaging the company, the stock price is growing like wildfire.

Having said all this, I’m willing to give Dennis a chance. I don’t think he should be fired. I’m supportive of Kevin so far too. They inherited years of bad management. They didn’t cause it.

You summed it up better than I could - very well stated!!

Vulture Capitalism is its name, and it wants indentured servants and sub-minimum wage working longer hours to ramp up production "so those investors who were promised outrageous profits will be happy".

We went through this before with the DC-10: cutting corners to increase profits by a few pennies at the risk of hundreds of lives is immoral and should be illegal. And don't get me started on golden parachutes...

Boeing's workers are great people, but like airlines of the past, Boeing isn't run by airplane people - it's being run by "business people" who see only dollar signs and short-term gains instead of quality and safety.

jagraham · Wed Apr 24, 2019 7:40 pm

Boeing is much more than the 737. Maybe the head of Boeing Commercial Aircraft should be worried, but not the CEO. Not yet.

kjeld0d · Wed Apr 24, 2019 7:47 pm

Veigar wrote:
exFWAOONW wrote:
Boeing hasn’t been the same since McDonnell Douglas bought them with their own money. These are the the same managers that made the MD11 a short-lived plane by not updating the wing to save a couple of dollars. I won’t shed a tear to see them depart.

I strongly doubt any of the things we're having issues with today go as far back as McDonnell Douglas. lol

Its called corporate culture... there seems to be a natural limit to how large a company can be before it starts to fall apart under its own weight. Next in the mea culpa line: Apple.

BoeingGuy · Wed Apr 24, 2019 7:48 pm

jagraham wrote:
Boeing is much more than the 737. Maybe the head of Boeing Commercial Aircraft should be worried, but not the CEO. Not yet.

The head of BCA is also fairly new. Kevin wasn’t around when the design issues occurred. He inherited it.

I’d sure as heck rather have Kevin as the BCA CEO than Ray Conner or Ron Woodard.