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Boeing CEO's Bad Month Reflects 737 Max Crisis

Bill Koenig
By Bill Koenig Senior Editor, SME Media


Dennis Muilenburg, the chief executive officer of Boeing Co., is concluding a bad month.

He lost his chairman’s title. One of the company’s outside directors is now non-executive chairman.

The CEO presided over another challenged earnings report, with the grounding of the 737 Max being a major factor. Regulators ordered the aircraft to remain on the ground after two crashes that killed 346 people.

Finally, he ended his month by going before Congress. He testified at a Senate panel on Oct. 29. He is scheduled to go before a House committee today.  

One of the highlights of the Senate panel hearing was family of 737 Max crash victims holding up photos of those who were killed. Muilenburg was then grilled by senators, including Republicans such as Ted Cruz and Democrat Amy Kobuchar, who is also a candidate for president

Senators asked what Boeing knew about a stall-prevention system linked to the two crashes and about delays in turning over to regulators internal company messages concerning system software. . (For a detailed account of the questioning, CLICK HERE for a story by Reuters and CLICK HERE for an account by The New York Times.)

At times, not only was the CEO under fire, the Boeing culture was under scrutiny. Muilenburg sought to defend both.

Corporate Culture

“Recently, there’s been much criticism of Boeing and our culture,” he said in his opening remarks to the committee. “We understand and deserve this scrutiny. But I know the people of Boeing…We know our work demands the utmost excellence.”

He also acknowledged that the effort to implement a software fix for the 737 Max “has taken longer than expected.”

The 737 Max qualifies as a crisis. The aircraft is one of the company’s most important. The grounding of the plane is adversely affecting Boeing customers. The image of Both Muilenburg and the company have taken major hits. Trust takes a long time to build but can dissipate quickly.

Muilenburg, 55, is an example of the Boeing executive lifer. He joined the company as a summer intern.

That’s why the 737 Max crisis is a test for both a man and a corporate culture. Muilenburg’s bad month has implications beyond one executive. In some ways, it’s the story of how well one of the top manufacturers in the U.S. can respond to one of its gravest challenges.

“We can and must do better,” the CEO said. “We’ve been challenged and changed by these accidents. We’ve made mistakes. And we got things wrong. We’re improving and we’re learning and we’re continuing to learn.”

The question is can executive and company learn and improve fast enough.


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