2024 06 27 194526
Boeing is struggling with transparency, trust, and cultural change. The company has lost the trust of regulators and its customers and is trying to be more open to regain that trust. Unfortunately, an executive chose the wrong topic and circumstances earlier this week, and the company has now offended an agency it has worked with for decades.
When transparency backfires
In a pre-Farnborough Air Show meeting for media at the Renton factory, Boeing cited how improvements in fuselages entering the company have improved productivity and how the “clean” fuselages are reducing traveled work. This is quite appropriate, and more transparency about the production process and safety improvements is welcome. But Boeing went well beyond what should have been discussed.
Unfortunately, Boeing also commented extensively on the Alaska Airlines flight 1282 door plug blowout situation, fully admitting that Boeing still doesn’t know who missed putting the bolts in and a paperwork SNAFU. However, that situation is under investigation by the NTSB. Boeing is subject to a non-disclosure agreement as a party to the investigation that prohibits the company from speaking about that event until the investigation is concluded. In a press release, the NTSB stated that “as a party to many NTSB investigations over the past decade, few entities know the rules better than Boeing.”
As a result, the NTSB is implementing sanctions against Boeing. “While Boeing will remain a party to the investigation, it will no longer have access to the investigative information that the NTSB produces as it develops the factual record of the accident. The NTSB will also subpoena the company to appear at an investigative hearing into the case scheduled for August 6 and 7 in Washington, DC. Unlike the other parties in the hearing, Boeing will not be allowed to ask questions of other participants.”
Because the U.S. Department of Justice is investigating Boeing regarding its Deferred Prosecution Agreement, “the NTSB will be coordinating with the DOJ Fraud Division to provide details about Boeing’s recent unauthorized investigative information releases in the 737 MAX 9 door plug investigation.”
Trust and Transparency go hand-in-hand.
Trust is earned by doing what you are supposed to do. Boeing has been failing in this regard by producing flawed aircraft, missing deadlines, and “quality escapes” that have impacted its credibility with customers. A BBC headline after the two MAX crashes said it all – “Boeing’s ‘culture of concealment’ to blame for 737 crashes.’ The lack of transparency at Boeing has evolved over several years since the McDonnell-Douglas merger, a key point for cultural change at Boeing.
That cultural change refocused the company from an engineering- and product-driven to a financially-driven company. With belt-tightening and a series of personnel cuts, Boeing’s capabilities in engineering eroded over the ensuing decades to the point that we’ve reached today. None of Boeing’s product families are on time, on budget, and without design or quality problems. From the MAX to the Dreamliner and 777-X, Boeing has been unable to deliver on its customer promises in commercial aircraft. Even the KC-46A tanker, Air Force One, and Starliner spacecraft have been technical or financial disasters eroding confidence and trust in Boeing. These aren’t new revelations, as Boeing faces a dilemma. The more Boeing releases, the worse the company appears to the public and its customers.
Changing Culture
However, if Boeing is indeed going to improve its corporate culture, the company must be transparent, acknowledge, and provide visibility into both problems and solutions. With so many issues happening at once, there is a challenge in balancing the company’s reputation, as the company once known for quality is now becoming the butt of late-night talk-show jokes.
Reversing Boeing’s reputation will require taking actions to improve each of its products, react to each incident, and reassure its customers and the traveling public regarding the safety of its aircraft. Transparency about these changes and their impacts on customers is vital for the safety of flight issues.
Boeing will have to admit its warts, but with the right attitude, discuss how they will be removed and why they won’t ever return. Transparency can help Boeing’s cause if they have the right strategy to be transparent about.
One thing is quite clear from the unfortunate breach of protocol this week: Boeing is currently rudderless under its lame-duck CEO. Boeing needs an outsider to take the reins to implement a turnaround strategy and talk about how the earlier problems are going to be solved. That type of transparency will be a key element in saving a once-great company that is running out of time, and cash flow to fund, a turnaround.
