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What Happened to Boeing?

Behind the aeronautics giant Boeing’s recent high-profile crises and scandals is a shift in its organizational culture toward greater looseness and decentralization in pursuit of profit. To get back on course, the company needs to realign all its operations with the unique demands of the aviation industry.

PALO ALTO – Boeing’s mounting crises are beginning to resemble an aviation thriller cooked up in Hollywood. In addition to a piece of fuselage falling off midair during a recent commercial passenger flight, there was the nail-biting discovery of mis-drilled holes in undelivered planes, and revelations that an inspector had found an “excessive amount of defects” in a supplier’s operations.

If those problems weren’t bad enough, in late February the Federal Aviation Administration delivered a scathing review of Boeing’s corporate culture and called on the company to implement more than 50 safety-related changes. Boeing was given 90 days to devise a plan to overcome its deep-seated quality-control issues.

Boeing has acknowledged responsibility, committed to slow down its breakneck manufacturing pace, and promised to do better. Its CEO, Dave Calhoun, has met with US senators; Boeing factories have held day-long “stand down” events to halt production and focus on quality control; and the company’s latest earnings call was all about safety, quality, and trust. But to deal with all its issues, Boeing needs to change its organizational culture.