Boeing heard all the warnings but just didn’t listen to its people

Boeing could take a page from Airbus' playbook and adopt works councils, which is where shop-floor employees meet regularly with their senior leaders to ensure safety complaints are heard.
Boeing could take a page from Airbus' playbook and adopt works councils, which is where shop-floor employees meet regularly with their senior leaders to ensure safety complaints are heard.

Summary

  • The plane-maker’s woes reflect a failure to clear wax from the ears of top managers. Executives need to listen better and show that they are doing so.

The strange thing about Boeing’s crisis is that so many people saw it coming—and tried to stop it. The planemaker’s safety problems have been obvious since two 737Max jets crashed in late 2018 and early 2019, killing 346 people. Boeing’s engineers were warning managers of potential quality problems as far back as 2001. But Boeing executives must not have listened and the 737Max crashes apparently weren’t a loud enough wake-up call.

So far this year, a panel has blown off a Boeing plane, both the chairman and chief executive officer said they are stepping down, and the company’s share price has tumbled 27%. So why haven’t those occupying the C-Suite heeded the engineers flagging safety issues? Why did they—according to whistleblowers—silence and ignore those employees? These are the most pressing questions for Boeing’s incoming leadership team. Without clear answers, the new executives will be doomed to repeat the mistakes of their predecessors.

Most leaders of manufacturing firms live in fear of being blindsided by a serious safety issue. Perhaps that’s why business schools devote so much time to worrying about how leaders can encourage employees to speak up about problems.

Boeing’s problem is not one of speaking up, though. It’s one of listening up. That puts the onus squarely on senior leaders. Amy Edmondson, a professor at Harvard Business School, says hearing employees requires two things. First, interpersonal skills—“listening to learn, asking follow-up questions, walking down the ladder of inference so that ultimately both members of the conversation have learned something." And second, systems that force those conversations to happen on a regular basis.

Those systems could take a number of forms, says James Detert, a professor at the University of Virginia’s Darden School of Business. At the extreme end are whistleblower hotlines, anonymous complaint processes and organizational ombudsmen. More routine measures include skip-level meetings and lunch chats with people in management.

Boeing could also take a page from the playbook of rival Airbus and adopt works councils, which is where shop-floor employees meet regularly with their senior leaders to ensure safety complaints are heard. At the very least, Boeing should follow my Bloomberg Opinion colleague Beth Kowitt’s suggestion and put an employee-union representative on its board.

There’s no shortage of ways for senior executives to listen; leaders just need to be proactive about doing it. Sitting back and saying “my door’s always open" isn’t nearly enough, as Megan Reitz of Oxford University’s Saïd Business School, has argued.

That’s especially important in the face of what Columbia University sociologist Diane Vaughan has called “the normalization of deviance." Vaughan developed her theory studying the Challenger explosion, in which managers overruled engineers’ dire warnings and proceeded with the launch. It’s not that the managers were malicious people; they just thought the engineers were being overly cautious. Space launches had happened in chilly weather before, but never as cold as that day in 1986. And there had been problems with the O-rings on previous launches and things had turned out fine.

Such thinking seems to have infected Boeing. Over time, when planes are held together by chewing gum—literally a problem with the botched 787 Dreamliner—but don’t fall out of the sky, the organization becomes convinced that chewing gum is a viable option.

Reversing any decades-long erosion in corporate culture requires bold gestures. Executives need to listen better and demonstrate that they are doing so. One way for Boeing to do that would be to relocate the company’s corporate headquarters back closer to its main manufacturing centres in Washington. This was actually proposed by a shareholder earlier this year, but shot down by Boeing’s board. That was a mistake. The 2001 decision to move its headquarters from Seattle to Chicago—and then to Arlington, Virginia, in 2022—has gone down in corporate lore as a big disaster. The initial relocation was justified by then-CEO Phil Condit saying it would prevent the “corporate centre" from getting “drawn into day-to-day business operations." But it’s clear that’s exactly where the corporate centre needs to be.

Another bold move: Make sure the plane-maker’s next CEO has a strong engineering background. After decades of hiring accountants to run the company, Boeing’s board should know that it’s problems are not ones of arithmetic. To be sure, “listen better" isn’t the only thing Boeing needs to do. But it’s the table stakes that will facilitate the required corporate transformation. The first step is clearing out the wax from the ears of senior leaders. ©bloomberg

Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
more

MINT SPECIALS

Switch to the Mint app for fast and personalized news - Get App