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frmrCapCadet
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Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 5:28 am

https://www.theatlantic.com/ideas/archi ... gs/602188/

This article will not be of any surprise to longtime readers of a.net. It is short and to the point. Boeing out and out no longer wanted to be an engineering company, but rather a Wall Street Darling. So it has become. I wrote a somewhat similar letter to a Seattle Times Business writer at the time. He largely plagiarized my entire letter without any credit at all (he was subsequently fired for other plagarisms, but was a great writer). My main point in the letter was that if Boeing wanted to be a first class air-frame maker they needed to sell of the commercial division and move its executives back to Seattle. I still think that is true. (actually even South Carolina would be better than Chicago, where, unfortunately it is so much at home)
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 6:22 am

Can't argue with any of this. But in a sense, Boeing is a victim of something even bigger. Rampant capitalism is out of control (beyond control?) and is behind most of our current woes - destruction of the environment, inequality, corruption, degradation of public services, loss of faith in democracy. I could go on. Condit, Stonecipher and gang were just going with the flow. Making money is all that counts.
 
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 6:32 am

PM wrote:
Can't argue with any of this. But in a sense, Boeing is a victim of something even bigger.


A victim? Say what?
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1989worstyear
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 6:48 am

oschkosch wrote:
PM wrote:
Can't argue with any of this. But in a sense, Boeing is a victim of something even bigger.


A victim? Say what?


...a victim of a very common mentality in modern corporate America: short term profit and shareholder value above all else.
Stuck at age 15 thanks to the certification date of the A320-200 and my parents' decision to postpone having a kid by 3 years. At least there's Dignitas...
 
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 6:57 am

What other purpose does a company have than to please the shareholders?
 
Blerg
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 7:00 am

seahawk wrote:
What other purpose does a company have than to please the shareholders?


To please its customers?
 
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LaunchDetected
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 7:03 am

seahawk wrote:
What other purpose does a company have than to please the shareholders?


Please the shareholders in a manner that no lives are lost. Plenty of companies does that.
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Mortyman
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 7:05 am

seahawk wrote:
What other purpose does a company have than to please the shareholders?


To develope and produce aircraft that don't fall out of the sky and decreases share value and belief in the Company ?
 
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Momo1435
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 7:12 am

LaunchDetected wrote:
seahawk wrote:
What other purpose does a company have than to please the shareholders?


Please the shareholders in a manner that no lives are lost. Plenty of companies does that.

If all companies would be like this there would be no defence or tobacco industries. (so no more Airbus and Boeing)

I think the constant drive to cut cost and increase productivity is something that is a factor in the whole industry. Ultimately this comes down to greed, not just by share holders but also by the flying public who only want dead cheap tickets.

Change will only if the whole industry makes big decissions.
 
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 7:14 am

LaunchDetected wrote:
seahawk wrote:
What other purpose does a company have than to please the shareholders?


Please the shareholders in a manner that no lives are lost. Plenty of companies does that.


And by and large, they do. Hundreds of millions fly safely and happily on Boeing planes every day.

Its passe on a.net to turn an issue (which is sizable in itself) into something absurdly out of proportion. If you read the last 12 months of a.net, one would think Boeing was run by Pol Pot and the Khmer Rouge.
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seahawk
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 7:21 am

LaunchDetected wrote:
seahawk wrote:
What other purpose does a company have than to please the shareholders?


Please the shareholders in a manner that no lives are lost. Plenty of companies does that.


And shareholders are happy with the billions of dollars that the grounding costs?
 
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LaunchDetected
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 7:31 am

seahawk wrote:
LaunchDetected wrote:
seahawk wrote:
What other purpose does a company have than to please the shareholders?


Please the shareholders in a manner that no lives are lost. Plenty of companies does that.


And shareholders are happy with the billions of dollars that the grounding costs?


Just look at the stock charts and you will have your answer.

Reducing quality of your product, moving your HQ far from the assembly lines, accusing your customer (Lion Air), there is a lot of short-term focused decisions that were made by Boeing. Sure the shareholders were really happy the day before Ethiopian crash.
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max999
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 7:42 am

Anyone remember the Boeing tanker scandal? Another example of corruption in the company.

This Boeing senior executive was sent to prison because of it. https://en.m.wikipedia.org/wiki/Darleen_Druyun

I question whether Boeing has cleaned up its act.
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TheFlyingDisk
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 7:46 am

Boeing is Evil Corp. We get it already.

What else is new?

max999 wrote:
Anyone remember the Boeing tanker scandal? Another example of corruption in the company.

This Boeing senior executive was sent to prison because of it. https://en.m.wikipedia.org/wiki/Darleen_Druyun

I question whether Boeing has cleaned up its act.


Nobody's innocent to be honest. Airbus is not clean from scandal either. https://en.wikipedia.org/wiki/Airbus_affair & https://www.theguardian.com/politics/20 ... rbus-saudi
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max999
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 7:54 am

TheFlyingDisk wrote:
Boeing is Evil Corp. We get it already.

What else is new?

max999 wrote:
Anyone remember the Boeing tanker scandal? Another example of corruption in the company.

This Boeing senior executive was sent to prison because of it. https://en.m.wikipedia.org/wiki/Darleen_Druyun

I question whether Boeing has cleaned up its act.


Nobody's innocent to be honest. Airbus is not clean from scandal either. https://en.wikipedia.org/wiki/Airbus_affair & https://www.theguardian.com/politics/20 ... rbus-saudi


I think many people are rightly upset at Boeing right now because of the two 737 crashes and all the issues that have surfaced as a result of this debacle. Boeing's reputation is in the gutter and it's their own doing.
All the things I really like to do are either immoral, illegal, or fattening.
 
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 8:46 am

seahawk wrote:
What other purpose does a company have than to please the shareholders?

I think that's an incredibly profound question that democracies should be debating in depth.
 
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scbriml
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 8:47 am

Blerg wrote:
seahawk wrote:
What other purpose does a company have than to please the shareholders?


To please its customers?


Nah, that's just a happy coincidence if it happens.
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seahawk
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 9:00 am

LaunchDetected wrote:
seahawk wrote:
LaunchDetected wrote:

Please the shareholders in a manner that no lives are lost. Plenty of companies does that.


And shareholders are happy with the billions of dollars that the grounding costs?


Just look at the stock charts and you will have your answer.

Reducing quality of your product, moving your HQ far from the assembly lines, accusing your customer (Lion Air), there is a lot of short-term focused decisions that were made by Boeing. Sure the shareholders were really happy the day before Ethiopian crash.


The stock does well because Boeing is part of a duopoly and the market position is still quite secure, as customers have the option to choose between taking the MAX or waiting a very long time for another option.

This duopoly is imho one of the reasons for the problems at Boeing, as the competition is quite limited in fact, especially with both OEMs producing at max capacity.
 
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keesje
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 9:00 am

I think over the last 20 years Boeing was very succesfull. It's stock was bought by millions of people and dominated NASDAQ.

Events like moving HQ, winning the tanker despite fraud, booming results despite the 4 yr / $25B Dreamliner gab, congress succesfully streamlining FAA towards Boeing control, changing rules / laws, forcing DoD to buy C-17s, out communicating airlines at 737NG and MAX crashes, Government pushing Billions in tax cuts, beeing the #1 exporter, sending DoC after competitiors..

It all added to a sense of invincibility, "Nobody can touch Us" culture. Living above the law.
I think you can clearly see it in the initial handling of the MAX crashes.
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art
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 9:58 am

1989worstyear wrote:
oschkosch wrote:
PM wrote:
Can't argue with any of this. But in a sense, Boeing is a victim of something even bigger.


A victim? Say what?


...a victim of a very common mentality in modern corporate America: short term profit and shareholder value above all else.


Best not to have airliners made by American corporates then. Going fast a long way above the ground is inherently risky to life and the people designing and making machines that do this need to have risk reduction foremost in their minds.

Boeing management are an illustration of how safety comes first in their list of prioritiess, along these lines:

Priorities

a - profit
b - profit
c - profit...

somewhere nearer the end of the alphabet - safety
 
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 10:23 am

max999 wrote:
TheFlyingDisk wrote:
Boeing is Evil Corp. We get it already.

What else is new?

max999 wrote:
Anyone remember the Boeing tanker scandal? Another example of corruption in the company.

This Boeing senior executive was sent to prison because of it. https://en.m.wikipedia.org/wiki/Darleen_Druyun

I question whether Boeing has cleaned up its act.


Nobody's innocent to be honest. Airbus is not clean from scandal either. https://en.wikipedia.org/wiki/Airbus_affair & https://www.theguardian.com/politics/20 ... rbus-saudi


I think many people are rightly upset at Boeing right now because of the two 737 crashes and all the issues that have surfaced as a result of this debacle. Boeing's reputation is in the gutter and it's their own doing.


People are upset because they're fed news that may not feature an accurate representation of the situation at hand.

One can argue that Lion Air is equally guilty of putting profits over safety, but you hardly see people pillorying them to the same tune as Boeing.
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 10:30 am

A corporation is a group of people. People range from decent, good-hearted ones all the way to pure evil. Any group will have a range of them. The trick for a corporation is to find the best ones to lead it and set the standards; because once the worse ones get control it is very hard for the good ones to regain it. And with the MD people essentially gaining control after the merger unfortunately that’s exactly what happened to Boeing.

As to corporate strategy, ultimately the goal of any corporation is to maximize profits. But those that focus on that as their objective will almost always fail at it. Those that focus on achieving it by offering a quality product and providing their customers with the best support they can will usually do much better. Treating profit as a by-product of good products and good service will almost always succeed better than focusing on it as the main objective.
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art
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 11:17 am

TheFlyingDisk wrote:
One can argue that Lion Air is equally guilty of putting profits over safety, but you hardly see people pillorying them to the same tune as Boeing.


True.

Lion Air management's interest in money above all else compromises safety. Boeing management's interest in money above all else compromises safety. I don't know which of the two is more condemnable but it sounds to me like Lion Air should be grounded until it can demonstrate it will follow the rules re: crew training.

SEPilot wrote:
Treating profit as a by-product of good products and good service will almost always succeed better than focusing on it as the main objective.


Agreed. But that sounds like long term thinking. Is that acceptable to many investors in US corporates?
 
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 11:53 am

There is no doubt that Boeing, like many USA companies, has serious long term issues caused by the need to keep up the stock prices and dividends short term. Sadly that mentality leads to cutting corners on engineering, quality of product, hurting staffing/labor relations, There were times when Boeing had close scrapes with bankruptcy. In the 1970's-early 1980's where a collapse in demand for aircraft due to high financing costs led to jokes in the Seattle area of 'who will be the last one to turn out the lights' as Boeing foundered. That was also before the rise of Microsoft and the tech industry there. As the leading exporter of USA made products, it led to a mentality that they could get away with and put pressure on politicians to get their way to keep up profits. Boeing is also very likely a significant stock involved with the retirement and pension accounts of most plans and funds so has to keep up the price and dividends or it hurts the stock markets as a whole and of millions losing the value of their retirement savings. They have become 'too big to fail', a dangerous position we have seen with banking in the USA.

Airbus has become a formidable competitor, although questions are raised as to the subsidies from governments and decisions that have hurt them like the A380. Likely in the next 10 or so years, we will see China develop as a significant competitor, especially in the narrow-body market or Boeing and Airbus doing joint production deals in China to get business from them, but with fears of theft of IP and loss of production in the USA.

Boeing, while a major military aircraft producer, becoming a bigger one when acquired McDonnell-Douglas, also gained some serious problems. Military contracts are ripe with corruption, cost overruns, difficult specification demands and often big, steady cash cows to be kept going no matter what.

Investment in new models, their risk in their investments, significant engineering mistakes, shifting of production away from Seattle, subcontracting of major components in parts led to delays in the the 787 and the 737MAX mess, likely to hurt profits for years. The low production rates of the 747, taking up valuable assembly line space and overhead costs that could be better utilized by better selling aircraft, also hurt the balance sheet.

Look at some of the most successful companies in the world, for example Toyota. They succeed as find ways to keep engineering and innovation at the top, make a quality product, don't overpay executives but pay workers decently and due to the structure of Japanese companies, look at the long term, not quarters as to stock price and dividends. In the USA that would take huge cultural, economic and government change. Still major change must take place or they too could end up on the scrapheap of dead or dying companies like Sears.
 
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 11:55 am

art wrote:
1989worstyear wrote:
oschkosch wrote:

A victim? Say what?


...a victim of a very common mentality in modern corporate America: short term profit and shareholder value above all else.


Best not to have airliners made by American corporates then. Going fast a long way above the ground is inherently risky to life and the people designing and making machines that do this need to have risk reduction foremost in their minds.

Boeing management are an illustration of how safety comes first in their list of prioritiess, along these lines:

Priorities

a - profit
b - profit
c - profit...

somewhere nearer the end of the alphabet - safety


Sorry, "profit" is just not correct. This is just not enough.
a) shareholder value
b) shareholder value
c) shareholder value
and this is not identical to "profit", it is not even not the most important part of the "shareholder value".

How to make shareholder happy:
a) kick staff
b) market share
c) outsourcing
d) close factories and go there where are no unions and work is silly cheap.
e) programs to buy back shares
f) and of course, margins and profits today and nice outlook for the next year. Who cares, what will be in 3 or four years...than the shareholder will have realized his profit and has bought the next one.
 
HaulSudson
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 12:56 pm

SEPilot wrote:
As to corporate strategy, ultimately the goal of any corporation is to maximize profits. But those that focus on that as their objective will almost always fail at it. Those that focus on achieving it by offering a quality product and providing their customers with the best support they can will usually do much better. Treating profit as a by-product of good products and good service will almost always succeed better than focusing on it as the main objective.


I agree but it depends on the kind of product.

If you're selling commodity like consumer goods with the above mindset, you're gonna fail against cheap low quality stuff backed by good marketing. This is what the bean counting kids learn in their MBA courses.

However, the above mindset is perfect if you're selling capital goods, such as airplanes. The disaster strikes when the MBA magicians apply their Excel tricks onto capital goods.

You'll end up for instance with a french engine maker that retired or sacked all experienced (read: expensive) engineers... before realising there was nobody left who actually knows how to build a functioning airplane engine.
:banghead:
 
GalaxyFlyer
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 2:57 pm

Boeing is listed on the NYSE, not the NASDAQ, and part of the DJIA.
 
1989worstyear
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 2:57 pm

art wrote:
1989worstyear wrote:
oschkosch wrote:

A victim? Say what?


...a victim of a very common mentality in modern corporate America: short term profit and shareholder value above all else.


Best not to have airliners made by American corporates then. Going fast a long way above the ground is inherently risky to life and the people designing and making machines that do this need to have risk reduction foremost in their minds.

Boeing management are an illustration of how safety comes first in their list of prioritiess, along these lines:

Priorities

a - profit
b - profit
c - profit...

somewhere nearer the end of the alphabet - safety


Well, to give B credit, the 737NG, 744, 757, and 777 all have proven themselves in the safety category; however, the 80's-mid 90's were probably a different time for the company.

And I can't say I'm happy with AB's choice of using kapton-insulated wire well into the 2000's after the Swissair 111 disaster. Whether this is some grandfathering thing from 1988 with the A320 is up for debate, but at least B started phasing that arcing-prone crap out in the early '90s (allegedly).
Stuck at age 15 thanks to the certification date of the A320-200 and my parents' decision to postpone having a kid by 3 years. At least there's Dignitas...
 
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 5:32 pm

sometimes a company can exists with the goal of doing stuff for the common good. it's folks accomplishing collectively what they can't individually. no one is getting rich. you approach some of your activities as a zero-sum game. not quite charity, not quite philanthropy, just a focus on your product (something meaningful and good) above profit. you may say that I'm a dreamer, but I'm not the only one.
learning never stops.
 
MR27122
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 6:34 pm

PM wrote:
seahawk wrote:
What other purpose does a company have than to please the shareholders?

I think that's an incredibly profound question that democracies should be debating in depth.


Agreed. Culture also "plays a part". Consider those fortunate enough to have Bernie Madoff allow them to invest in his fund. They were extremely wealthy, which denotes a fundamental of who democracies perceive as "successful". Seemingly they invested w/o any due-diligence & believed that straight upward trajectory lines on a graph for "markets" was normal....or worse (& probably more realistically) greed & profiteering blinded them & they paid the price of being fools.

Did McD really take over Boeing w/ Boeing's $$$? Interesting....so Boeing's upper Mngmt was, for lack of a better word, kinda wimpy & they got rolled by those from McD that were integrated & retained post Merger? Sorry I forget, but what was the purpose of the HQ move to Chicago? Wasn't McD HQ-Engineering-Production solely based in Long Beach for the duration of the company being McD.....?
 
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 6:55 pm

Antarius wrote:

Its passe on a.net to turn an issue (which is sizable in itself) into something absurdly out of proportion. If you read the last 12 months of a.net, one would think Boeing was run by Pol Pot and the Khmer Rouge.


Yep. In direct relation to "Crime and Corruption", how many threads did we see, or even mention of, the Airbus bribery scandal? Nary a peep.
 
blockski
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 7:03 pm

seahawk wrote:
What other purpose does a company have than to please the shareholders?


This is precisely the mindset that has damaged a great American corporation like Boeing.
 
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smithbs
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 7:13 pm

The Atlantic article is interesting, and with the benefit of hindsight it seems to describe today's situation. Figuring that the McD "takeover" was in the late 1990s, I guess Boeing has only done one clean sheet design since: 787. Kind of a big slowdown for a company that had counted models up from 0 to 7 in about forty years. Having read Joe Sutter's autobiography, it does appear that this article has a valid point to make. And my engineering friends at Boeing certainly have their opinions of Stonecipher. :tapedshut: I think they still enjoy the ethics rules he put in place and then violated.

But one thing eludes me - how this post's title corresponds in any way to the Atlantic article. I think the OP is taking a drastic (overly dramatic?) turn on an article that states its point rather succinctly. Or perhaps the anti-Boeing/corporate/economics wolves are out and need something thrown to them? The progress of this thread tells me the answer. The spirit of this thread is such that I don't think it's aviation worthy and belongs in non-aviation.
 
smartplane
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 7:18 pm

HaulSudson wrote:
SEPilot wrote:
As to corporate strategy, ultimately the goal of any corporation is to maximize profits. But those that focus on that as their objective will almost always fail at it. Those that focus on achieving it by offering a quality product and providing their customers with the best support they can will usually do much better. Treating profit as a by-product of good products and good service will almost always succeed better than focusing on it as the main objective.


I agree but it depends on the kind of product.

If you're selling commodity like consumer goods with the above mindset, you're gonna fail against cheap low quality stuff backed by good marketing. This is what the bean counting kids learn in their MBA courses.

However, the above mindset is perfect if you're selling capital goods, such as airplanes. The disaster strikes when the MBA magicians apply their Excel tricks onto capital goods.

You'll end up for instance with a french engine maker that retired or sacked all experienced (read: expensive) engineers... before realising there was nobody left who actually knows how to build a functioning airplane engine.
:banghead:

With NB production volumes and acquisition decisions, we have a new category - mass-produced capital goods.

WN isn't the only airline not to do a CAF (or full CAF), before taking delivery of NB aircraft. Now a new NB aircraft delivery is treated by customers much the same way a new truck was 20-30 years ago.

The same attitude has permeated through the leasing and finance industries. Gone are the days, when a financier would visit the OEM factory, pose with the aircraft, and then it quickly found it's way into the latest staff newsletter. Now those photo opportunities are restricted to first of type, and OEM insistence.
 
OccupiedLav
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 8:00 pm

A quick lesson on how public corporations work: When you please customers, you usually please shareholders. When you please shareholders, you don't necessarily please customers. Having unhappy customers eventually turns into having unhappy shareholders. You cannot have a successful business in the long term if you forget about the customers. Customers and shareholders are strongly correlated.

Having said that, some of you people are acting like Boeing is pure evil. It's not. Some people made some costly and unfortunate mistakes, and now they are facing the consequences. Customers and shareholders are both unhappy, forcing change for (hopefully) the better. Overall, Boeing is a pretty good company. They just need to get some things straightened out.
 
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 9:24 pm

mham001 wrote:
Antarius wrote:

Its passe on a.net to turn an issue (which is sizable in itself) into something absurdly out of proportion. If you read the last 12 months of a.net, one would think Boeing was run by Pol Pot and the Khmer Rouge.


Yep. In direct relation to "Crime and Corruption", how many threads did we see, or even mention of, the Airbus bribery scandal? Nary a peep.


I read all about it on airliners.net and AWST and WSJ, listened to it in the news on BBC and ABC CBS, NBC... It was big news and scandal is hard to hide. If one of the many airbus planes crashed due to a manufacturing flaw, it would have been much worse than the Boeing’s issue.
Knives don't kill people. People with knives kill people.
OUTLAW KNIVES.

I am a pilot, therefore I envy no one...
 
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 9:37 pm

oschkosch wrote:
PM wrote:
Can't argue with any of this. But in a sense, Boeing is a victim of something even bigger.


A victim? Say what?

Yes! A Victim!! Of being a wall Street Darling and of Rampant Greed! Most if not ALL of their Management has lost sight of what they're doing. And what they're SUPPOSED to be doing. Building Innovative ,Safe, Reliable Airliners! They started going for the "Fast Buck" I've got a LOT of friends at Boeing who are embarrassed by what Management has become. They're proud of Boeing but HIGHLY embarrassed! Many of them think this will actually become a Blessing in Disguise. As this episode will return Boeing to the right path and maybe get rid of these Bogus managers who only see Boeing as some "Cash Cow" they can Milk!
 
VetteDude
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 10:23 pm

I work in the business world and I think the very prevalent idea (among both leaders in the business world as well as investors who constantly preach about it) that companies only exist to enrich shareholders is a very dangerous cancer. It's newer idea that has unfortunately spread very rapidly where everyone now parrots "companies only exist for shareholders" every time a situation like this comes up. The old way of thinking is that businesses have many stakeholders, of which shareholders are included, but also employees, retirees (now it's all out class warfare), customers, even the government and environment. Capitalism is not evil, but greed is one of the 7 deadly sins, and unfortunately greed has replaced many old school values.
 
P3guy
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Re: Crime and Corruption (add incompetence) At Boeing

Tue Nov 26, 2019 11:59 pm

Through out history we forget lesson's learned about greed, if it is not the individuals, the shareholders and stakeholders tied to corporations with capitalism, it is government officials tied to socialism or rulers to communism. Easier to get rid of CEO than a elected official or ruler...…….Corporations that balance the 3 sides of the triangle, the client, the shareholder and the employees ultimately win if the board keeps them in check and balanced. That is a lot easier to do than the 3 branches of the US government as us U.S. Citizens know with the lack of integrity on both sides of the political spectrum.
,
 
iamlucky13
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Re: Crime and Corruption (add incompetence) At Boeing

Wed Nov 27, 2019 12:03 am

VetteDude wrote:
I work in the business world and I think the very prevalent idea (among both leaders in the business world as well as investors who constantly preach about it) that companies only exist to enrich shareholders is a very dangerous cancer. It's newer idea that has unfortunately spread very rapidly where everyone now parrots "companies only exist for shareholders" every time a situation like this comes up.


It's perhaps worth pointing out that companies themselves don't promote this message. For one, obviously it looks bad from a PR standpoint.

For another, most people who aren't complete fools recognize it is short-sighted.

The countless airliners.net members who seem to think Boeing (or Airbus, for that matter) executives don't recognize that they can only reward their shareholders by producing a safe product are fundamentally mistaken. Anybody who thinks a typical executive goes to work in the morning plotting how to trade safety for profit is delusional.

The real disconnect that is likely to occur in management (and in engineering, for that matter) is recognizing what it actually takes to produce a safe airplane. At what point does a cost reduction actually reduce safety? Can a change for cost effectiveness that has a safety impact be mitigated by some other change (eg - ETOPS trading reduced redundancy for demonstrated reliability)? How do you prevent complacency in every stage of the process after a long period of success?

The old way of thinking is that businesses have many stakeholders, of which shareholders are included, but also employees, retirees (now it's all out class warfare), customers, even the government and environment.


I can tell you authoritatively that this mindset of multiple stakeholders still exists and has been reflected in various ways by each of my employers throughout my career. I currently work for a megacorp industrial company, and the concept of multiple stakeholders was brought up on my very first day (by my manager, exactly the sort of fancy-pants MBA grads that are so popular to revile here) and has been reiterated regularly since then, as has safety for both my coworkers and our customers.

Don't get me wrong, I can lodge plenty of complaints from experience about the way giant corporations can make bad decisions and fail to accomplish full diligence, but overwhelmingly, the intent is to do things right, and the failures I encounter are usually human mistakes, not intentional recklessness.
 
P3guy
Posts: 7
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Re: Crime and Corruption (add incompetence) At Boeing

Wed Nov 27, 2019 12:09 am

Give me capitalism and a democracy any day, it is not quick but there is a chance and stable way to correct and change course once a clear majority is reached. Our time is coming, the middle is where safe progress is made.
 
MaverickM11
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Re: Crime and Corruption (add incompetence) At Boeing

Wed Nov 27, 2019 12:17 am

The interesting thing I got from this article is that the leadership from McDonnell Douglas largely took over Boeing: a company with a dead end product line of a DC-9 warmed over a dozen times and a trijet no one wanted, repeated the same thing at Boeing, who-save for the 787-has an endlessly tweaked 1960s design in the 737 and a limited 777 design. Would Boeing leadership have innovated more without McD?
I don't take responsibility at all
 
dtw2hyd
Posts: 8338
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Re: Crime and Corruption (add incompetence) At Boeing

Wed Nov 27, 2019 1:00 am

Just to be clear, this topic is about management, not employees. Sure employees may have kept quiet because their jobs and retirement savings are at stake, that is common for any employee. Not everyone is born a whitsleblower.

HQ away from engineering and/or production is a proven practice. Works very well. Strategic thinkers at HQ can have a big picture taking input from engineering/production without getting bogged down with daily grind. That doesn't mean management should be completely out of touch to a point that cannot answer which department does what in a congressional hearing.

Also, a rouge engineer not updating middle/upper level management theory is also pushing spin too much.
All posts are just opinions.
 
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zkojq
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Re: Crime and Corruption (add incompetence) At Boeing

Wed Nov 27, 2019 5:02 am

SEPilot wrote:
As to corporate strategy, ultimately the goal of any corporation is to maximize profits. But those that focus on that as their objective will almost always fail at it. Those that focus on achieving it by offering a quality product and providing their customers with the best support they can will usually do much better. Treating profit as a by-product of good products and good service will almost always succeed better than focusing on it as the main objective.


Couldn't have said it better myself. There was a time that Boeing's primary focus was engineering excellence, now it's primary focus is quarterly cashflow.

Unfortunately they are far from the only company in the aviation industry to have switched focus like that.

mham001 wrote:

Yep. In direct relation to "Crime and Corruption", how many threads did we see, or even mention of, the Airbus bribery scandal? Nary a peep.

Plenty actually, though most of their titles were to do with the retirement of Airbus leadership.
First to fly the 787-9
 
Karlsands
Posts: 229
Joined: Sat Sep 16, 2017 2:53 pm

Re: Crime and Corruption (add incompetence) At Boeing

Wed Nov 27, 2019 5:15 am

PM wrote:
seahawk wrote:
What other purpose does a company have than to please the shareholders?

I think that's an incredibly profound question that democracies should be debating in depth.

Or constitutional republics
 
n7371f
Posts: 1822
Joined: Fri Jul 04, 2008 3:54 pm

Re: Crime and Corruption (add incompetence) At Boeing

Wed Nov 27, 2019 5:16 am

Harry Stonecipher about the biggest scumbag CEO in the history of aviation. Ruined 2 legacy aviation companies. Well done, Harry.
 
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PM
Posts: 5269
Joined: Wed Feb 09, 2005 5:05 pm

Re: Crime and Corruption (add incompetence) At Boeing

Wed Nov 27, 2019 5:27 am

Well, this is timely. From today's BBC website.

https://www.bbc.com/news/business-50562518

"The corporation has failed to deliver benefit beyond shareholders, to its stakeholders and its wider community," he said.

"At the moment, how we conceptualise business is, it's there to make money. But instead, we should think about it as an incredibly powerful tool for solving our problems in the world."
 
DeltaConnection
Posts: 70
Joined: Fri Sep 27, 2019 10:16 pm

Re: Crime and Corruption (add incompetence) At Boeing

Wed Nov 27, 2019 6:08 am

Let's put Boeing aside for a minute and go after the real villain, the FAA. They should be disbanded and it's top officials arrested for mass murder, not just for the MAX 8 accidents but for many other crashes in history that could've been prevented with proper oversight/action. The FAA has a lot of blood on it's hands and it concerns me no one is taking action against them or looking to abolish the agency.
 
User avatar
PM
Posts: 5269
Joined: Wed Feb 09, 2005 5:05 pm

Re: Crime and Corruption (add incompetence) At Boeing

Wed Nov 27, 2019 6:43 am

DeltaConnection wrote:
Let's put Boeing aside for a minute and go after the real villain, the FAA. They should be disbanded and it's top officials arrested for mass murder, not just for the MAX 8 accidents but for many other crashes in history that could've been prevented with proper oversight/action. The FAA has a lot of blood on it's hands and it concerns me no one is taking action against them or looking to abolish the agency.

In a sense, you can't really abolish it. That is, you'd need to replace it with something similar. The work still needs to be done.

But isn't the bigger issue the funding of the FAA? I'm not American but as far as I have read, successive administrations have cut its budget substantially to the point where it can't do its job. Another example of neoliberalism scaling back the state with disastrous (but predictable) consequences.
 
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SEPilot
Posts: 5631
Joined: Sat Dec 30, 2006 10:21 pm

Re: Crime and Corruption (add incompetence) At Boeing

Wed Nov 27, 2019 6:46 am

PM wrote:
Well, this is timely. From today's BBC website.

https://www.bbc.com/news/business-50562518

"The corporation has failed to deliver benefit beyond shareholders, to its stakeholders and its wider community," he said.

"At the moment, how we conceptualise business is, it's there to make money. But instead, we should think about it as an incredibly powerful tool for solving our problems in the world."

Read Adam Smith. Everyone working for their own best interest works for the best interest of the whole. That applies to corporations too. If corporations work to maximize profits by offering the best products and service that they can it will also go a long way towards solving those problems you refer to.
The problem with making things foolproof is that fools are so doggone ingenious...Dan Keebler

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