Throughout my first career in television news, I was fascinated by how companies handled crisis situations. Most often, a crisis is managed by denial, such as a name change or a new paint design or a totally forgettable new slogan. My interest in crisis scenarios led me into a second career in crisis and reputation management.
When a corporate crisis happens, it’s seldom acknowledged as self-inflicted. Let’s face it, executives rarely like to own-up to mistakes even when a corporate crisis might wreck careers, stock options, reputations, and trust. It happens a lot, but I have never seen an example of this dynamic as clear as the mess caused by Boeing.
In a recent corporate statement that underscores that Boeing is as concerned with sales as with safety of its troubled 737 Max, the company’s Chief Financial Officer Greg Smith revealed— at the 2019 Paris Air Show, no less— the possibility of a name change for the Max. This, for a plane that’s been grounded for months after two fatal and violent crashes. It’s akin to the classic adage, when you put lipstick on a pig, it’s still a pig.
Such a reckless statement by a top Boeing exec opens the door to all kinds of assumptions about the chaos going on inside the company. Perhaps there’s really not an effective safety fix for the plane that’s been grounded for months. Maybe… just maybe… the 737 Max is, unfortunately, a deeply flawed airliner, and Boeing knows it.
After all, another major issue is Boeing’s use of more powerful new engines on the 737 Max… engines so big that they need to be mounted forward of the wings rather than under the wings where they might drag the ground. Some pilots say these engines change flight characteristics of the 737 Max.
Boeing executives have only exacerbated rumors about the Max crisis through their careless statements.
By way of review, Boeing quickly developed a different configuration of its famous 737 line of commercial aircraft to compete with the popular Airbus A320neo. Boeing rushed the Max to market. Yet, the 737 Max apparently has so many odd flight characteristics that the company glossed them over with software and did not adequately inform pilots. The plane’s powerful software, called MCAS, can unexpectedly take control out of the hands of pilots and aim the plane straight at the ground. It has happened twice with deadly results.
Boeing CEO Dennis Muilenburg now says the company made a “mistake” in handling a problematic cockpit warning system before two crashes killed 346 people. And he promises transparency as the aircraft maker works to get the grounded plane back in the air. He also says Boeing’s communication with regulators, customers, and the public “was not consistent.”
These are some of the understatements of the year.
Now, the CFO suggests the company may rename the plane. I wonder if that was prompted by an April 15 Tweet by President Trump to add some “great features” and “REBRAND (sic) the plane with a new name.” Maybe Mr. Trump would volunteer to ride on the first flight of a “REBRANDED” 737?
Let’s not forget that Boeing originally suggested that 737 Max crashes in Indonesia and Ethiopia happened because foreign pilots were not as well-trained as U.S. pilots. Oh boy… that’s not the way to win international customers or loyalty.
Aviation officials from more than 30 countries met in Dallas with the FAA in June to hear updated prospects for clearing the troubled 737 Max. Afterwards, many foreign airlines began canceling orders and asking Boeing for buy-backs of the troubled Max, now considered by many to be risky to fly.
Boeing once had a pristine reputation that reflected excellence, reliability, and safety in the skies. But then along came Airbus, a multinational European aerospace corporation that focused on advanced technology as the catalyst to sales dominance.
In the mid-1980s, there were just a handful of Airbus planes in service by U.S. airlines. Today, it’s about half and half between Boeing and Airbus. Along the way, Boeing has caused other self-inflicted problems, such as hiring military personnel as lobbyists… professionals who are legally restricted from lobbying.
In the dog-eat-dog competition to crowd the skies with airliners, Boeing conveys the image of an outfit more concerned with sales— as evidenced by the words of their executives— while Airbus appears to have quietly established a more solid footing on safety.
Meanwhile, Captain Chesley “Sully” Sullenberger, the retired US Airways pilot known for the “Miracle on the Hudson landing” and an authentic hero, has told a congressional panel that pilots of the grounded Boeing 737 MAX should get new simulator training before the plane returns to service. Sullenberger debunked Boeing’s insistence that pilots only need a couple of hours training on an iPad, saying it’s not enough.
“It is clear that the original version of MCAS (the 737 MAX software) was fatally flawed and should never have been approved,” Sullenberger told the US House Transportation and Infrastructure Committee. (It was an Airbus A320 that Capt. Sullenberger landed in the Hudson River, by the way.)
Regardless of how Boeing “rebrands” or renames its 737 Max, I believe the company needs to remove a couple of top executives, publicly acknowledge the Max is a mistake, and start over to develop a safer airliner from scratch. Yes, it would cost Boeing billions of dollars but it is the price to regain public trust, and the penalty for cutting corners.
A footnote: At the 2019 Paris Air Show, the all-important venue for showcasing aircraft sales, Airbus has won a major 150-plane order from American Airlines and Air Lease Corporation which leases aircraft to Virgin Airways, among other airlines. The orders allow Airbus to develop its new 240-seat XLR airliner, a variant of Airbus’s best-selling A320neo. Meanwhile, British Airways signed a letter of intent for 200 of the Boeing Max for BA’s budget subsidiary airlines, not quite as firm a deal as actual purchase orders snagged by Airbus.