As the dismal story of the Boeing 737 Max fiasco drags on, it’s worth taking a look at how the disaster happened. Boeing, after all, has been around since 1916—to put that in context, the Wright brothers made their famous flight in 1903—and has produced such astounding successes as the B-52, the 707, and the 747. How then, did the company that produced such great aircraft manage to stumble into the 737 Max morass?
Matt Stoller tells the sad tale in his blog post, The Coming Boeing Bailout?, which has lessons for the software industry as well. Stoller’s post is really excellent and I urge you to read it. Until the Clinton administration, Boeing—at least the civil aviation division—was an engineer-run organization. Management all had aviation backgrounds but more importantly, all the engineering decisions were made by the engineers. As quoted in Stoller’s post, Fortune described Boeing as “…less a business than an association of engineers devoted to building amazing flying machines.”
That changed when, under pressure from Clinton’s Deputy Secretary of Defense, Boeing merged with McDonnell Douglas and the suits from McDonnell Douglas took over running the combined company. These people, by and large, did not have aviation backgrounds and what they did was in the military sector with its infamously corrupting, political, and inefficient design, procurement, and contracting practices. They immediately started making decisions of the sort you’d expect from people who are mostly bean counters. For example, they started off-shoring critical work for political reasons. The engineers, of course, complained and predicted disaster but were ignored. Ignoring the prediction didn’t prevent the disasters, though. The first was the 787 Dreamliner that came in (way) over budget and had such problems as batteries that caught fire.
Then in 2005, Boeing hired James McNerney, their first CEO without a civil aviation background. This was like Apple hiring Pepsi Cola president John Sculley to be CEO and the results were the same. One of McNerney’s first decisions was to launch the 737 Max project. There’s no point in recounting the results because they have been well told elsewhere but the TL;DR is that hundreds of people are dead, Boeing has lost billions of dollars and, more importantly, their reputation is in tatters.
When reading Stoller’s post, I couldn’t help but compare the old Boeing to Bell Labs. In both organizations the engineers made the engineering decisions and the suits were pretty much ignored when they tried to butt in. That’s how it should be. The C-level executives set the goals for the company; schmooze the customers and Wall Street; and run the finances, accounting, and all the silly stuff like HR but the engineers make the engineering decisions. When that discipline breaks down you get a 737 Max.
