The burden of the 787
by Knute Berger
Good thing we'll have some of these to sell. Credit: Boeing Company
This week, there’s yet another delay in the delivery date of Boeing’s new 787 Dreamliner, a nightmare of a project that is already three years late and an emblem of the troubles besetting New Boeing. Awkwardly for such a forward-thinking enterprise, the company had previously said that it will never do that again even before the first plane is out the door.
We say New Boeing because people in Seattle have a history with the company, and have lived with and through its changes. The old-school Boeing we remember, now referred to semi-officially as “Legacy Boeing,” is kind of like Classic Coke: a brand loved in part for what it is not. Your daddy’s Boeing is not New Boeing, the aircraft company whose internal cultural struggles are exemplified by a plane that can’t quite get off the ground. It was a plane that was supposed to embody the embrace of globalization, but perhaps found that too heavy a load to bear.
The old Boeing — big, paternalistic, risk-taking, engineer-driven — did not die without help. It was the victim of a kind of self-administered corporate death panel, a series of executive decisions driven by changes in the corporate world and the global market place. That struggle is documented in a fascinating new study, Turbulence: Boeing and the State of American Workers and Managers (Yale University Press, 2010) by Edward S. Greenberg, Leon Grunberg, Sarah Moore, and Patricia B. Sikora. It’s the result of an academic study of a cohort of workers at Boeing’s Commercial Airplane Division from 1997 through 2006. Using employee interviews and surveys, the authors have compiled a qualitative and quantitative view of what Boeing workers have been through, and how they’ve coped with change.
The authors are quick to point out that Boeing went through change that has been typical of American industries competing in a new world. Indeed, Boeing seems like the perfect case study. Like many other corporations, it adopted change designed to radically alter its internal culture.
There was a wave of Toyotaization — a determination to eliminate waste and maximize efficiency. There was the Total Quality Management boomlet; there was the merger with (some say takeover by) McDonnell-Douglas. There was the shift from Boeing as a “family” to the new concept of “team.” There was a determined effort to change the way planes were conceived and built, shifting from hand-crafting to computers, from customization (reportedly 1,000-plus versions of a 747 bulkhead) to the 787’s uniform “snap together” mode, from relying on in-house talent to outsourcing.
There were also efforts to make the company less lazy, sexist, racist, and corrupt. Former Boeing CEO T. Wilson was once asked how many people worked at Boeing and replied, “About half of them.” The bureaucracy of old Boeing, its good ‘ol boy culture, and its bribery scandals are often lost in the haze of nostalgia for what was good: the right stuff attitude, the commitment to quality and craftsmanship, the sense that Boeing took care of its people with great pensions, healthcare, and loyalty.
And, along with everyone else, Boeing had to adapt to competition, strikes, layoffs and downturns, and rapid technology shifts.
But something was lost in transformation. The succession of new management fads made employees cynical and created new competitive cliques. The shift from being a Boeing family made many feel uncared for, and even blamed. Some workers bristled at having to take mandatory ethics classes when it was Boeing’s top brass who were implicated in scandals. Already somewhat used to job insecurity from cyclical layoffs, employees now had to contend with an attitude that was focused not on nurturing or mentoring workers, but a new landscape of balkanized teams that, according to one, operated on a “shoot the wounded” basis. Instead of Boeing pride, workers were exhorted to put shareholders first. It was a conscious decision to back-seat the engineering culture.
As Boeing CEO Harry Stonecipher, who had headed McDonnell-Douglas, said at a Seattle Rotary meeting in 1998, employees at Boeing had to “quit behaving like a family and become more like a team. If you don’t perform, you don’t stay on the team.” That, according to the authors of Turbulence, caused some to believe an unbreakable bond had been broken.
The team ideal, we know, is not perfect by any means. Look down the street at the Seattle Mariners, whose decline some have pegged to the decision by management (notably former Nintendo exec Howard Lincoln) to put franchise profitability above winning. Running a team meritocracy, however, is no guarantee of success. There are intangible assets like customer loyalty, identity, and getting the most out of your players. Throughout the decade under view in Turbulence, much of the wear and tear on Boeing employees, beyond simply working harder in a more competitive environment, was the erosion of morale that comes from a culture of constant (and sometimes contradictory) change by management initiative. Survey results showed that workers who stayed at Boeing were more often depressed than those who left.
Another is that the New Boeing team is still waiting for the tangible signs of success. Boeing has been a company that had laid big bets (the 707, 747) putting all the company’s chips on the line. So too with the 787. If the struggles to get it right mirror Boeing’s own internal struggles to position its aircraft manufacturing for the new century, the problems with the 787 also carry the burden of bringing back pride to the people who have sacrificed so much to make it happen. If the bet pays off, Boeing will boost its employees sense of purpose. If it becomes aviation’s Edsel, the long slog of cultural revolution may prove to be even more demoralizing.
Legacy Boeing isn’t quite dead. The company still has much of it in its DNA, but also it literally lives on in the thousands of ex-Boeing employees who live here. They came out in force one night last December at Town Hall for a celebration of the launch of the Jet Age. Boeing vets, including Joe Sutter, a 707 engineer and “father” of the 747, were on a panel with others including test pilot Brien Wygle, Peter Morton, an engineer from Boeing’s “College of Jet Knowledge,” and Paula Clark, a former Pan Am stewardess. All came together to talk about the early days of the 707 and its prototypes and how it came to be.
Host of the event was Sam Howe Verhovek, author of a history of the era, The Jet Age. The audience was mostly retirement age, male, with short white hair. When I described it to my wife she said, “Sounds like a reunion of the cast of Apollo 13,” which caught the flavor. It was peppered with Boeing heros of the pre-787 era, and was an informative celebration of the high-rolling, barrel-rolling company of yore. But it was also clear that Legacy Boeing was history, its vets more likely to be leading tours at the Museum of Flight than advising on the 787. Somewhere in the first decade of the 21st century, Boeing broke with its past. We’re waiting to see if it also broke its future.
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