The rot runs so much deeper than whichever scapegoats they want to pin it on. The story of Boeing is the story of modern American managerial culture. Excess all around. Excessive executive compensation. Excessive financialization. Excessive outsourcing. Excessive offshoring. Excessive returns to uneconomic activity. Excessive credentialism. Excessive lobbying.
Jack Welch is dead but if they wanted to try someone he’d be a great person to start with.
It's interesting you would mention Jack Welch because he said:
> Shareholder value is the dumbest idea in the world.
There is myth about how corporate directors have a legal duty to maximize "shareholder value" and short term corporate profits at the cost of everything else. This is false. No such thing exists in corporate law. While Burwell v. Hobby Lobby is a deplorable decision, there is a rather remarkable sentence in there:
> modern corporate law does not require for-profit corporations to pursue profit at the expense of everything else, and many do not do so.
> Shareholder primacy was famously established in the decision of Dodge v. Ford Motor Co. in 1919. In Dodge v. Ford Motor Co.'s court opinion, it stated that "there should be no confusion" that "a business corporation is organized and carried on primarily for the profit of the stockholders." Because of this opinion, a precedent was set that managers had to maximize shareholder profit.
Dodge v Ford Motor Co was a Michigan Supreme Court decision while I quoted SCOTUS. The very article you linked strongly suggests it's not a general law:
I really enjoyed your comment because I have found myself speaking that untruth out loud when I lament the state of corporate ethics.
But, isn't it the case that activist investors aren't really using legal means to ensure that same result; they are using other means anyway? And, the net result is the same?
Yeah this isn’t just Boeing, it’s the senators who don’t want Boeing jobs to be risked in any serious consequences is my interpretation of how this seems to work
Jack Welch is a great case study in corporate psychopathy, but I feel like the Boeing chapter would address different aspects in the future MBA’s reading list. This is something more along the lines of the Postal Service scandal in the UK.
Real world incidents, and their incident report, that ahould be mandatory reading for every engineering and management student:
- Chernobyl: great lessons on how to engineer complex systems, the importance of safety culture, the role humans and management olay and how all of this can lead to disaster
- AF 447: lessons on training and HMI design and human factors
- B737 MAX: to be read after Chernobyl, lessons on safety again, mandatory essay to be writen about the parallels between Chernobyl and the B737 MAX
- Bonus reading for the above two points: Fukushima
- B737 MAX 9 and door plugs (once the final repoets are done): lessons on the importance of failure culture and strong quality processes
- Bad Blood, Money Men: Everybody needs a primer in corporate governance, ethics and the red flags that come with it; add the final reporting on the UK postal scandal and FTX
If you can't meet DEI without compromising on merit, your country must have serious fundamental problems at every stage of your education system.
And even that's if you need a significant fraction of your nation's elites — given observed problems such as "failing to install bolts correctly" and "management deliberately ignoring raised safety concerns" and "there's no automatic cut off timer for something which will damage the aircraft if left on for more than 5 minutes" don't even need elites, if you really believe what you wrote, you need to campaign for much better fundamental education starting decades ago. Boeing doesn't hire a significant fraction of the USA, so this must, if you were right, be basically endemic across your nation.
Your response neglects simple facts.
You are missing that certain vocations are not as popular to women as they are to men.
I doubt this is inherently an issue with the education systems.
I think what corporate America has been focusing on heavily recently was DEI, which is fine, but it seems that has caused management to lose focus on other matters impacting quality.
I've seen this first hand where a high ranking VP announced his highest priority is diverse hiring, again this is fine, but it's a choice in priority setting that sends a clear message if tradeoffs need to be made down the chain.
I am not against DEI or blaming diverse hires for issues.
I think management in corporations sometimes does poorly identifying metrics that measure what success means to a company.
Is it a 50/50 mix of women and men or to uphold the highest quality standard.
Boeing does not exist in isolation. There are many other companies in the labor market.
What I am referring to is a well understood dynamic. It's unclear to me what your counter point is here.
Jack Welch is dead but if they wanted to try someone he’d be a great person to start with.