Transparency A Must!! – #49

Boeing has been incurring problems in building a quality plane ever since they decided that in order to grow, they would need to move their headquarters and production facilities out of their well established Washington State location where they could have expanded with ample real estate availability. Instead they chose to move their Headquarters to Chicago and above all commit to outsourcing key parts for their leading new plane models and assembly functions all over the U.S.. The result of this decision, guided by the young Turks with their power-point presentations that looked good on paper, but did not involve any contingency plans both for upside and downside contingencies.

Yes, gone is the experience that was part of Boeing’s core employees who served the company with dedication and loyalty evident in every function. I can vouch for their excellent communications abilities as a supplier to a key area (the wiring department responsible for hand assembling the hundreds of wiring harnesses that go into each plane). Gone are the skills developed and honed to a state that produced a quality and reliable plane. The best example of the negative impacts of outsourcing can be seen in the sourcing of parts for their two largest and newest planes, only to find that 700+ suppliers sent in parts that didn’t fit – yes, didn’t fit. This resulted in multi-year delays of launching the new planes, with losses of profit, cancellation of orders in hand and providing a competitive opportunity to the only other competitor that represents the EU.

If it is proven that Boeing knew about their current 737 Max problems on year ago and didn’t notify their Customers, you can rest assured that SWA and United will have to have extensive guarantees in order for both airlines to take off the current grounding orders. Based on both of these airlines keeping their 737 MAX’s grounded until they feel safe, so will all the rest of the Airlines across the globe be monitoring the progress.

One wonders on the answer to the question – how did the Max gain approval and to what degree were Boeing officials involved in the process? It seems that Boeing engineers seemed to think that the sensor problem didn’t adversely impact airplane safety or operation. While several notifications seem to have been released , Senior Boeing leaders didn’t learn about the issue until after the October 29th, 2018 Lion Air crash. Why the delays in admitting that they had a software problem in designing the –angle-of-attack disagree alerts? Why did it take a four month delay between notifying key Customers SWA and UNITED of the possible software glitch?

IT DOESN’T LOOK GOOD FOR BOEING?

If Boeing knew of the problem a year ago, Why did it take 500 plus fatalities in both 737 crashes to start making the adjustments? There are very few companies in the world making commercial jets, but this action will assure a timely response from these competitors – as Boeing moves from the leadership position to last place in the world.

Profit squeezes and non-reliable sourcing plus Distribution and assembly operations throughout the world are now the backbone of Boeing. Thousands of qualified and loyal employees lost their jobs due to the Suits developing strategies without upside and downside contingency plans reflecting strengths and opportunities.

One wonders whether the savings were achieved, as a result of moving out of the Seattle area. My guess, is that someday the payoff will be realized, but in the meantime Boeing will have a major challenge in getting the MAX737’s owned by SWA and UNITED flying again.

IT STARTS and ENDS WITH MANAGEMENT LESSON:

  1. Produce quality products that are totally supported with training etc..
  2. Provide TRANSPARENCY 100% of the time to as much info that is available to all Customers.
  3. If something goes wrong, have a contingency strategy in place (ONE PAGE PLAN) that kicks in without delay and covers all the bases regarding the contingency.

Boeing will suffer dearly, if in fact the Company knew of a potential safety problem with 737 MAX for a year prior to disclosure.