Worst Boeing crisis since 1970s, says prof who interviewed workers

“If Boeing is to recover,” says Leon Grunberg, professor emeritus of the University of Puget Sound, “it must once again become a great engineering company by prioritizing safety and quality over short-term considerations.”

(Scroll down to read Grunberg's damning opinion piece.)

Leon Grunberg has written several books on the Boeing workforce and says the aerospace giant is facing its greatest crisis since the 1970s.

In 2018 and 2019, two of Boeing's 737 MAX planes crashed, killing everyone aboard.

Grunberg interviewed workers as Boeing merged with McDonnell Douglas, from the late 1990s to 2014. They told him the company's rigorous engineering culture was under attack but that the planes were safe.

"I believed them because of their commitment to and pride in building a safe product," he said in an interview with KUOW.

That was before the MAX crashes. This week a former Boeing manager told Congress he tried to get his boss to halt MAX production over issues that wouldn't have been tolerated in the military.

"I will never forget his response which was, ‘The military is not a profit-making organization’," Edward Pierson told a congressional committee.

"Such a mindset is disastrous," Grunberg says of Pierson's testimony. "These values seep into and pervade the whole organization."

Grunberg says if Boeing is to put the MAX crisis behind it, it must return to the successful engineering standards that produced planes like the 777.

Boeing’s workforce has been largely silent. Neither the Machinists union nor the engineers’ union SPEEA has spoken publicly about the MAX, and union members frequently say they cannot share their concerns.

Boeing told KUOW: “Safety is our top priority, always has been and always will be. We maintain a relentless focus on safety and are taking the steps necessary to prevent future tragedies.”

In the years after the merger with McDonnell Douglas, workers told Grunberg they were struggling with the company’s new focus on cost-cutting.

In his book Emerging from Turbulence, Grunberg recounts an interview with a retired engineer, David Sutton, who said the company “did not have enough time to do the due diligence of test and trial … And the people that kept saying, like me, ‘Don’t do that to the research,’ they retired, they left.”

“The retirees I talk to are very saddened and upset at what’s happened to Boeing’s reputation,” Grunberg said. “I believe that beyond the technical issues ... the root of the recent problems is Boeing’s culture, and until that’s addressed, problems will persist.”

In an unpublished opinion piece Grunberg wrote in late October, around the time of Boeing CEO Dennis Muilenburg’s testimony to Congress, Grunberg said it is wrong to believe you can preserve safety when the organization is driving toward reducing costs and speeding up delivery.

“You can’t seal off safety and quality from the ethos, goals, and norms that are institutionalized by a new culture. They will eventually affect safety and quality,” he says.

Grunberg's analysis is similar to that of former Boeing engineer and SPEEA representative Stan Sorscher, who also points to the change in Boeing's culture after the McDonnell Douglas merger.

Here is Grunberg’s opinion piece:

In 2004, Harry Stonecipher, former CEO of McDonnell Douglas and the CEO of Boeing unambiguously spelled out how the merger with McDonnell Douglas had transformed the company: “When I say I changed the culture of Boeing, that was the intent, so it’s run like a business rather than a great engineering firm. It is a great engineering firm, but people invest in a company because they want to make money.”

Making money would mean prioritizing profit margins and shareholder value and minimizing costs and risks. Financial goals would dominate decision making.

There is nothing remarkable about a CEO of a major U.S. corporation making such metrics the primary focus of the business, but building planes is not like most other businesses. Short-sighted or poor decisions can lead to spectacular financial losses and the death of hundreds.

The post-merger mindset did boost Boeing’s share price. But decisions taken in both the development of the 787 and the 737 MAX expose serious flaws and dangers in the post-merger mindset.

In the case of the 787, the decision to massively increase outsourcing, including crucial engineering work, resulted in a three-year delay, a demoralized engineering workforce who felt their accumulated expertise was no longer valued, a five-month grounding, and billions in costly overruns.

With the 737 Max it was decisions to rush a derivative model to customers despite concerns about the safety of the new MCAS system and to avoid triggering expensive additional pilot training.

This time the cost is not only in untold billions but in the loss of 346 lives. In both cases, a few brave employees warned of potential pitfalls with these strategies. For the 787, about the dangers of relying so heavily on less experienced suppliers and the risk of losing control of such a complex and sprawling supply chain. Boeing told KUOW: “Safety is our top priority, always has been and always will be. We maintain a relentless focus on safety and are taking the steps necessary to prevent future tragedies.”

In the case of the Max, recently released internal documents reveal, that engineers were pressured to limit safety analysis and testing so as to meet schedule and keep costs down, that an engineer warned about relying on a single A of A sensor as far back as 2015, and that a test pilot privately noted to a colleague that MCAS is “running rampant in the sim on me” and “trimming like crazy” and that he “lied to the regulators (unknowingly). “

During a multiyear study of the Boeing workforce with colleagues (1996 to 2014), employees told us of the many safeguards built unto the process-the redundancies, the repeated testing, the inspections, and their commitment to building a safe product.

But it has become clear that safety cannot be sealed off from the goals and values that dominate the culture at Boeing.

When top executives prioritize profit margins, minimizing costs, and speed of delivery, these seep into and gradually pervade the whole organization. Incentives change and what gets rewarded and encouraged and what gets punished and ignored also changes.

Warnings are buried or ignored. Employees become reluctant to speak up and rock the boat. Such a mindset is disastrous when applied to high risk, complex processes like building airplanes.

Twice in a decade, Boeing has had to learn lessons from self-inflicted wounds. In reaction to the massive outsourcing on the 787, it has chosen to bring crucial engineering work back in house on the 777X.

And in response to a potentially devastating loss of confidence in the safety of it planes among the flying public and its customers, Boeing is strengthening its safety system by creating a new safety organization, promising to investigate cases of undue pressure on employees, and giving engineers a direct line of reporting to the CEO via the chief engineer.

But as time passes and competitive and investor pressures confront executives there is the danger of slipping back to what has become “normal” and institutionalized.

To again become a great engineering company, Boeing has to return to its roots—prioritizing the quality and safety of its planes rather than the chase for short term financial targets. That is the surest way to regain its reputation for safety and to be financially successful for the longer term.