Boeing: Basic Dumb Think
In 2001 Boeing, with a push from Wall Street investors – who had manipulated stock and buy-outs of many of Boeing’s competitors, folding them into the larger aviation company -- changed from being an aviation pioneering and engineering company to being a supplier of services to aviation and space exploration and supporting the Pentagon’s needs. In lock step with their newly redefined corporate role, the board of directors decided to be nearer to the center of America and moved all the corporate offices away from Washington State to Chicago. It took them another few years to realize that wasn’t working and they simply moved to where the money hand-outs were being made, Washington DC.
As the then-Boeing CEO Harry Stonecipher explained, “When people say I changed the culture of Boeing, that was the intent, so it’s run like a business rather than a great engineering firm.” That intent met with great profit forecasts from Wall Street and a huge increase in executives’ salaries. However, two decades later Boeing is neither a great business nor a great engineering firm. No one was at home watching the day-to-day hands-on operation and if they were, they were being told, very long distance, how to cut costs so that Wall Street money people could make more money. After all Boeing was only a business, wasn’t it?
Imagine you were a restaurant owner. Let’s say your restaurant is at the cutting edge of capability and innovation. Would you, as the owner try to guide your staff from thousands of miles away? Did Henry Ford leave his offices in Highland Park only to move to Wall Street? Where do the most innovative engineering CEOs in electronics have their offices? Is INTEL’s Patrick P. Gelsinger’s office in Manhattan? Nope, like many others in that trade, his office is where the day-to-day oversight need to be, deep in Silicone Valley.
Manufacturing is not a business first and foremost. The lesson at Boeing is that if you run your engineering and manufacturing well, then the business will thrive. If you cut corners, putting business practices ahead of manufacturing and engineering needs, your product quality will decline, you will lose business, you will be open for take-overs and lose customers. Airbus is now over 50% of all aircraft sold to airlines in America. Where’s Guillaume Faury, the head of Airbus, located? Atop the factory in Toulouse, France. And he has no plans to move anytime soon.
If Boeing wants to recover its reputation and impetus, it needs to move back to the office atop the plant in Everett, keep an eye on actual manufacture, and go back to basics. Arlington Virginia, as plush as it may be for executives, is a poison pill Boeing cannot survive.













