Boeing’s Snowballing Problems

That recent incident with the door falling out of a Boeing passenger jet in flight was attributed to “missing bolts.” According to the NTSB the door had been removed to repair some rivets; after the rivet repair whoever installed the door didn’t reinstall the attaching bolts. Standard procedure should be to attach the attaching hardware to the item (with tape or wire) when the item is removed so that when it’s replaced the attaching hardware is part of the item and is handy and used for reinstallation. (Even if the hardware has to be removed to do the repairs, it is to be re-attached after repairs.) This obviously indicates poor parts and handling policies and procedures which need to be reviewed and/or revised. 

THE MUCH BIGGER BOEING ISSUE is what the press is calling “supply chain problems” having to do with subcontractors and ill-considered overuse of outsourcing of major aspects of the assembly. I was stationed for three years at the Air Force Plant Representative Office (AFPRO) at the McDonnell-Douglas plant at Lambert Field in St. Louis in the mid-70s where, among other things, I was the designated officer for signing the acceptance paperwork for some very expensive aircraft support, test, and training equipment. On a number of occasions I had to tell the execs at McDonnell-Douglas that we were not going to accept certain very specialized spare parts and test equipment for one reason or another. This meant that, although McDonnell-Douglas was getting “progress payments” under their contract, a substantial amount of their huge contract prices would be withheld until the equipment was complete, acceptable and on-time. 

In those days McDonnell-Douglas was run by some very tough and experienced manufacturing and production execs, most of whom learned the aircraft production and assembly business as parts and fabrication expediters during FDR’s accelerated military production ramp up after Pearl Harbor. These guys were not blow-dried, Amani-suit marketing and finance guys. They were hard-charging rumpled-shirt production managers who knew how to make and assemble airworthy aircraft and support equipment to military specifications. They didn’t need an MBA to know that the production line had to move and the resulting aircraft and equipment had to be of top-quality. I could go into a number of incidents which I was personally involved in which demonstrated this old-school management style which, sorry to say, seems to have disappeared from modern manufacturing. And Boeing’s escalating production and support problems demonstrate what happens when that old hard-nosed management style is abandoned in favor of finance and sales as the priority. 

When problems developed on the production line, those earlier era execs knew that you had to spend money to fix them (Boeing has apparently realized some of this after the fact), fix them fast, and keep the line moving and the quality high. I remember one case when McDonnell-Douglas abruptly just up and bought a good sized casting fab plant, installed some of their own managers, re-tooled, and fixed the quality problem with the castings, and then re-sold the plant back to its original owners six weeks later. When I asked the guy who engineered this drastic step (the Director of the “Materials Priorities Group” as it was called) how such a thing could happen, he replied, “The boss wants it done, whatever it takes, and the company we bought has no choice but to go along because of McDonnell Douglas’s strength in the marketplace.” In other words, the suppliers knew that if you got on the wrong side of a company like McDonnell-Douglas your other business would take a dive. When a dispute arose over whether McDonnell Douglas could provide documentation to prove a point they wanted to make, one exec once bragged to me, “Hell, Captain, don’t you realize that we can out-government the government?” And they could.

In the wake of the latest rash of problems, Boeing has announced that a woman named Stephanie Pope has been promoted to be Boeing’s new Chief Operating Officer.

Before her promotion Ms. Pope was chief financial officer of Boeing Commercial Airplanes. According to on-line bios, Ms. Pope was an Eisenhower Fellow in Brussels and Ireland in 2008 and has a bachelor's degree in accounting from Southwest Missouri State University and a Master of Business Administration from Lindenwood University in St. Charles, Missouri.

With the departure of Boeing’s Board Chair, a Mr. Larry Kellner, a man named Steve Mollenkopf will act as “independent board chair” until a more formal vote at Boeing’s next shareholders meeting. Until 2020 when Boeing hired him, Mr. Mollenkopf was CEO of Qualcomm, a SoCal electronics manufacturing company. He has bachelor's and master's degrees in electrical engineering. 

Before stepping down Mr. Kellner was CEO of Continental Airlines for a while before taking over at Boeing. Before that Kellner was Chief Financial Officer at American Savings Bank.

These are not the resumes of people who should be running an aircraft manufacturing and assembly company like Boeing. The fact that the company chooses such people for their top jobs indicates that Boeing’s already snowballing problems are likely to accelerate.