Posted on 04/05/2024 6:57:41 AM PDT by MtnClimber
Boeing is—or was—a great company. From its manufacturing plants in Seattle, it produced the world’s most reliable, efficient aircraft. But after merging with McDonnell Douglas, shifting production around the world, and moving its headquarters to Chicago and then Arlington, Virginia, the Boeing Company has been adrift.
Then, in October 2018, one of Boeing’s new 737 MAX aircraft crashed. Then, a few months later, another. Recent months have seen embarrassing maintenance failures, including a door plug that blew off an Alaska Airlines plane in mid-flight.
To help explain what went wrong, I have been speaking with a Boeing insider who has direct knowledge of the company’s leadership decisions. He tells a story of elite dysfunction, financial abstraction, and a DEI bureaucracy that has poisoned the culture, creating a sense of profound alienation between the people who occupy the executive suite and those who build the airplanes.
This interview has been edited for length and clarity.
Christopher Rufo: I am hoping you can set the stage. In general terms, what is happening at Boeing?
Insider: At its core, we have a marginalization of the people who build stuff, the people who really work on these planes.
In 2018, the first 737 MAX crash that happened, that was an engineering failure. We built a single-point failure in a system that should have no single-point failures. Then a second crash followed. A company cannot survive two crashes from a single aircraft type. Then-CEO Dennis Muilenburg defended the company in front of Congress, defended the engineering, defended the work—and that protected the workforce, but it also prodded the board and stoked public fear, which resulted in a sweeping set of changes that caused huge turnover in talent.
So, right now, we have an executive council running the company that is all outsiders. The current CEO is a General Electric guy, as is the CFO whom he brought in. And we have a completely new HR leader, with no background at Boeing. The head of our commercial-airplanes unit in Seattle, who was fired last week, was one of the last engineers in the executive council.
The headquarters in Arlington is empty. Nobody lives there. It is an empty executive suite. The CEO lives in New Hampshire. The CFO lives in Connecticut. The head of HR lives in Orlando. We just instituted a policy that everyone has to come into work five days a week—except the executive council, which can use the private jets to travel to meetings. And that is the story: it is a company that is under caretakers. It is not under owners. And it is not under people who love airplanes.
In this business, the workforce knows if you love the thing you are building or if it’s just another set of assets to you. At some point, you cannot recover with process what you have lost with love. And I think that is probably the most important story of all. There is no visible center of the company, and people are wondering what they are connected to.
Rufo: If they have lost the love of building airplanes, what is the love, if any, that they bring to the job?
Insider: Status games rule every boardroom in the country. The DEI narrative is a very real thing, and, at Boeing, DEI got tied to the status game. It is the thing you embrace if you want to get ahead. It became a means to power.
DEI is the drop you put in the bucket, and the whole bucket changes. It is anti-excellence, because it is ill-defined, but it became part of the culture and was tied to compensation. Every HR email is: “Inclusion makes us better.” This kind of politicization of HR is a real problem in all companies.
If you look at the bumper stickers at the factories in Renton or Everett, it’s a lot of conservative people who like building things—and conservative people do not like politics at work.
The radicalization of HR doesn’t hurt tech businesses like it hurts manufacturing businesses. At Google, they’re making a large profit margin and pursuing very progressive hiring policies. Because they are paying 30 percent or 40 percent more than the competition in salary, they are able to get the top 5 percent of whatever racial group they want. They can afford, in a sense, to pay the “DEI tax” and still find top people.
But this can be catastrophic in lower-margin or legacy companies. You are playing musical chairs, and if you do the same things that Google is doing, you are going to end up with the bottom 20 percent of the preferred population.
Rufo: What else does the public not understand about what is happening at Boeing?
Insider: Boeing is just a symptom of a much bigger problem: the failure of our elites. The purpose of the company is now “broad stakeholder value,” including DEI and ESG. This was then embraced as a means to power, which further separated the workforce from the company. And it is ripping our society apart.
Boeing is the most visible example because every problem—like, say, a bolt that falls off—gets amplified. But this is happening everywhere around us, and it is going to have a huge effect. DEI and ESG became a way to stop talking honestly to employees.
We need to tear off the veil of all this coded language that is being used everywhere, and our elites need to recover some sense of service to people. They think they have it already because they are reciting these shibboleths of moral virtue: “I am serving because I am repeating what everyone else is saying about DEI.” It’s a form of cheap self-love that is being embraced by leaders. If you pay the tax to the DEI gods or the ESG gods and use coded language with your workforce, it absolves you of the hard work of really leading.
No. Service means you are spending the extra time to understand what’s really happening in the factory and in your supply chain. There should be some honor in understanding that we inherited something beautiful and good and worth loving.
Alex, I will take “What happens when you go woke” for $1000, please.
Many erroneous AP licenses floating ……
There should be some honor in understanding that we inherited something beautiful and good and worth loving.
They don't.
The Dunning-Kruger effect is also applicable to rich, stupid people.
Non-aircraft people do not understand this - you either have aviation in your blood or you do not.
If you do not, but pretend that you do, you are a poser and a destroyer of aviation culture.
Those who consider themselves to be “elites” seem to be suffering from mass formation psychosis that causes them to buy into DEI and ESG to be part of the group. And it becomes GROUPTHINK.
This is spot on,
It's a big problem, with many aspects. I trace a lot of it to MBAs. Companies began to be run by people who did not understand the business. They knew spreadsheets. They knew financing. They could squeeze profit by putting little numbers in little boxes. For awhile, they seemed OK. Shareholders liked it, but the core business competence began to decrease.
If the people at the top really knew their business, they would have been in a position to say that the Woke stuff was bad for business. But that ship had already sailed. The people at the top are just about the perception. If you check certain boxes, you look good, and that is enough.
Sports Illustrated was famous for their annual swimsuit edition. Then they put a transgender on the cover. Didn't go well. The people in charge actually didn't see that coming.
Bud Light is another good example. If the people running the beer company understood the business of beer -- and specifically the demographics of the Bud Light consumer base -- they would not have chosen a transgender as the face of Bud Light. But they did. Because they didn't understand their business.
Once upon a time, a worker would start at the bottom and work their way up. They knew the business inside and out because they had worked the business at many levels. True, you wouldn't find many CEOs who really started in the mail room. But a lot of Managers had started at the ground level.
I think that has largely disappeared. These days, you start at the bottom, and you will stay at the bottom. There are just fewer "careers" now. Just jobs. Just dead-end jobs. And middle management was seen as wasteful and got hollowed out. There is no where for people to move up to. And the people at the top start at the top (They got that Harvard degree, and they know people). They run the beer company until they transition over to the airplane company and then they transition to the computer company. They don't understand any of it.
I am a yuuge fan of Christopher Rufo - this is great.
Boeing started losing their way when they moved their Headquarters from Seattle to Chicago.
Now that they've moved their Headquarters from Chicago to Alexandria, VA (near DC) it's going to get even worse.
You can add 'destroyer of innocent lives' to that.
Moved HQ to Arlington. Death Nell of any decent company. They’ve become 100% part of the problem in the USA.
Excellent point.
Good Post. Yes, aviation is in our blood. When an airliner goes down, it is personal to us.
In the 1970s and ‘80s I watched the American machine tool industry crumble around me, as the fine old legacy companies came under the control of MBAs who knew nothing about the business except how to extract value for short-term shareholder profit. No engineering, no strategic planning, nothing. The Japanese came in selling machines inferior to what we could build, but with superior computer tech, and they stole the most profitable market segment, the job shops.
/rant
There are old GE tool machines that although they weigh a ton, would still work today.
>Moved HQ to Arlington. Death Nell of any decent company.<
The death knell is when they moved to Chicago to be in the hometowm of The One. I know another once great company that did the same.
EC
Knell.
Check out the dark comedy movie of long ago: Other People’s money.
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