The Long-Forgotten Flight That Sent Boeing Off Course | Hacker News Reader

The Long-Forgotten Flight That Sent Boeing Off Course

theatlantic.com

88 pointspseudolus26 comments

Despite all the press around the specifics of MCAS and the 737 MAX, the broken relationship between Boeing and the FAA, and the poor state of Boeing pilot training in many developing countries, this article reads as the single most damning piece about Boeing. The implication is that there isn’t a simple policy or process fix to get Boeing back on track, but that the company culture and leadership model is fundamentally broken and has been for the last 20 years. That is a slow and painful thing to recover from, and not many companies have done it successfully (though Microsoft and IBM come to mind as ones who made it through to the other side).

And planes have such long design cycles that it can take quite some time for the negative effects of such a change to become visible, and once they do, it takes a long time to turn things around.

> and the poor state of Boeing pilot training in many developing countries,

IHTPO that the 737 Max's that crashed were the newest planes operated by companies with advanced training.

It's no question that random airlines flying clapped-out planes in remote corners of the earth can be quite scary* (some of the smaller operators in the OECD countries too) but that isn't really a factor in the two crashes that grounded the aircraft.

* On two occasions in my life I have been frightened enough not to get on a scheduled flight (I didn't hear that either crashed). These were entirely been due to the physical state of the aircraft.

I would not characterize Lion Air as well trained. https://www.cnbc.com/amp/2019/10/25/lion-air-737-max-crash-i...

Look at IBM’s 10 year chart. There’s a reason BA is the only stock I’ve ever shorted.

20 years, that's half the career of people. Those established before the downturn are either gone or about to (if not quit by disappointment already, or worse, assimilated), the rest knew only this or mostly this. Assuming Boeing only career. Externals may know different, but they are not Boeing. Seems like Boeing is irrevocably lost, ruined.

Yeah I would not say IBM has made it out, and MS is not stable either (can both their employees and revenue make it to a new equilibrium?)

The fact is virtually all the large companies are in Byzantium mode. Get ready for hundreds of years of rent seeking without political action. Startups cannot solve this in there own, haha, certainly when they all want to get acquired!!

You might be one of the only people that believes Microsoft’s stability is questionable

It always amazes me that culture fit is always applied to the lowly grunt but not the top exec.

Here we have Boeing, a company built by engineers with the engineering ethos, and MBA types were given the helm of the company. Why didn't the culture fit apply to new leadership?

That's a double standard I haven't considered before. If it has been shown to work on a lower level to the point where companies implement culture fitting, then why isn't being implemented on all levels?

One example in the other direction seems to be Eric Schmidt being hired at Google.

Because in most US companies the workers don't have a say in who the leaders are.

The financialization of Boeing was a "success".

Boeing's stock rose. Executives made their money and cashed out. Somebody else was left holding the bag.

This is the behavior the current market rules incentivize.

> This is the behavior the current market rules incentivize.

What changed in the "market rules" between then and now? How do you make a causation from that diff plausible?

Another alternative: A once great company fell apart due the usual factors: greed, incompetency, entropy, failed succession plans, great people being unusual, ethically minded technical founders being replaced by MBAs - who then turn out creating larger profits in the shorter term, etc.

It's highly unusual for great companies to remain great companies over a long period of time.

Edit: I mean, I agree that it seems like the behavior of large companies has changed quite a lot; from say 1980 to 2010. But how much of that is cultural, and how much is legislation? What has driven this change? (Are we talking about the same thing, using different terminology?)

Between then and now there has been a lot of legislative and legal change empowering corporations and disempowering individuals. (Most notably Citizens United, but that 2010 decision postdates the Boeing takeover.)

I think the main factor here, though, is that executive behavior evolved to exploit existing weaknesses in the regulatory environment in order to maximize their personal benefit at the expense of company health. You can call that a "culture change" if you like.

Some (including me) argue we should respond to such changes by patching the vulnerabilities in the market environment. Others disagree and advocate letting the market sort itself out; I maintain that this means continuing to incentivize bad behavior.

> I think the main factor here, though, is that executive behavior evolved to exploit existing weaknesses in the regulatory environment in order to maximize their personal benefit at the expense of company health. You can call that a "culture change" if you like.

What that else would you call it, though?

It seems to me that the root cause is that the legislators haven't kept up with the increasingly sophisticated behavior of the companies.

> Some (including me) argue we should respond to such changes by patching the vulnerabilities in the market environment. Others disagree and advocate letting the market sort itself out; I maintain that this means continuing to incentivize bad behavior.

FWIW I think I'm on the same side as you here. What I worry about is that all of this patching creates more complexity, which can then in turn be exploited by the (often smarter) people working for these companies. (Seems similar to the infosec problem in software.)

The stock exchanges also changed quite a lot from 1980 to 2010. That's what brought new rules to the companies.

A great question is why did the stock exchanges changed? I can't find any single answer, but I think operations optimization and the consequent low transaction costs played a large part.

Sure, yeah, the democratization of stock exchange "betting" via the internet may have been a factor.

Assuming the conclusions of the article are correct, Boeing is yet another company driven to disaster by the desire to put someone in charge who isn't an expert on the product the company sells.

Let's discuss. When does it makes sense to put a non-product-person in charge? Why, beyond the old stock price pump-n-dump? Any counterexamples where it worked for a while and then the wheels came off?

I've quite enjoyed the Atlantic's coverage of Boeing and the 737MAX issues.

And by enjoyed I mean "been fascinated by". It's never a nice thing to read.

> "When people say I changed the culture of Boeing, that was the intent, so that it’s run like a business rather than a great engineering firm."

Wow, why would anyone think this is an okay viewpoint to have? Because capitalism? When I'm flying I don't care that the aircraft I'm in was made I by a company that was run like a business. I want to be in an aircraft that is safe. And the only thing that can make them safe is great engineering.

Clearly this comment was directed at investors and not customers. A business's goal is to please investors. If that happens to be what's best for customers, it's just a side-effect. An engineer on the other hand cares about the actual product they are working on. And it order for that to be successful, customers have to be satisfied.

This case is a good illustration to an earlier discussion in HN on how and why company values and culture actually matter.

> That, in turn, contributed to the company’s extraordinary decision to move its headquarters to Chicago, where it strangely remains—in the historical capital of printing, Pullman cars, and meatpacking—to this day.

Yes, yery "strange" for an airplane manufacture to remain headquartered the same place as the HQ and/or major hub of its largest customer airlines.

Boeing expected to get a lot more defense work. Having headquarters in a major urban location gave it an additional 2 senators and a couple more reps in the house that could then champion those sales.

While final 737 assembly was done in Renton, the fuselages were made in Wichita. Which was also the site of a booming business in remanufacturing Boeing aircraft for both the civilian and military market. Making it out like there’s no good reason to have a more central HQ doesn’t ring true.

Finally, it’s not like Boeing didn’t have issues before the merger. They had to take a billion (with a ‘B’) charge on engineering issues with the 737NG tail section. A lot of heads rolled for that. I left before DCAC/MRM finished but I’d find it hard to believe that didn’t go over budget by a similar amount.

I'm sort of surprised they haven't spun off the defence and space divisions as separate companies yet.

When you measure everything by the value of the dollar it is no surprise that ephemera such as quality and pride evaporate.

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