737 Max Crashes Raised Questions About Boeing’s Culture. Soon Its CEO Will Have to Answer Them
Boeing CEO Dennis Muilenburg is scheduled to testify in front of a House committee on October 30, his first congressional appearance since 346 people died in the crashes of two of his company’s recently introduced 737 Max aircraft.
Muilenburg can expect to be grilled about the airworthiness of the troubled 737 Max and the updates being made to its problematic flight software in order to avoid a repeat of the crashes of Lion Air flight 610 in October 2018, and Ethiopian Airlines flight 302 in March 2019.
“At this defining moment, Boeing must take an expanded leadership role with a heightened focus on safety—and reach even higher,” Muilenburg said Monday in a release.
But he will also have to address another troubling issue—and one that is perhaps more difficult to fix: the role that failings in Boeing’s corporate culture played in the crashes.
“The question is who knew what and when?” says aviation expert Chris Tarry. “It still seems that as stones are lifted up there’s more underneath that they (Boeing) need to counter, or they need to address, or they need to provide answers to.”
The damage so far
Boeing has said it would cooperate with Congress and work closely with the different regulatory authorities around the world to safely return the 737 Max to service. The company has estimated that full compliance with the Federal Aviation Administration (FAA) flight-crew-alerting system would cost the company an estimated $10 billion.
This comes on the back of the company posting a $3 billion quarterly loss on July 24—its largest-ever. To date, the 737 Max groundings are estimated to have cost Boeing around $8 billion, mainly due to remunerating airlines for a 72% fall in deliveries during the year.
There are compensation costs as well. On September 25, Reuters reported that Boeing had settled the first raft of compensation claims from the families of those who died in Indonesia’s Lion Air crash, with loved ones receiving “at least $1.2 million” for each victim. Boeing did not admit liability, according to Reuters, though Indonesian investigators have blamed “design and oversight lapses” for playing a key role in the October 2018 crash.
Aside from the technical issues and costs, however, it may be the culture within Boeing itself that needs the most attention. In the aftermath of the fatal 737 Max accidents, Amy C. Edmondson, Novartis Professor of Leadership at Harvard Business School, described Boeing workers as being “pushed to maintain an overly ambitious production schedule and fearful of losing their jobs if they raised concerns.”
Writing in the Harvard Business Review she added that it represented “a textbook case of how the absence of psychological safety—the assurance that one can speak up, offer ideas, point out problems, or deliver bad news without fear of retribution—can lead to disastrous results.”
In a July open letter in the Seattle Times, Stan Sorscher of the Society for Professional Engineering Employees in Aerospace (SPEEA), struck a similar tone, blaming Boeing’s problems on a company-wide shift towards “cost-cutting” and the development of a corporate culture that “is the opposite of a culture built on productivity, innovation, safety or quality.”
Cost and speed over quality?
Boeing CEO Muilenburg will likely face tough congressional questions about those cultural issues at the end of October, though insight into the inner-workings of the plane maker have already trickled out.
On Wednesday, the House Transportation and Infrastructure Committee asked Boeing to make engineer Curtis Ewbank, 33, available for interview following reports that he filed an internal ethics complaint about the 737 Max’s safety—and had warned about the reliability of the flight control software as far back as 2014.
According to the Seattle Times, Ewbank’s complaint describes the plane maker as having a corporate culture based on “expediency of design-to-market and cost-cutting” and being “more concerned with cost and schedule than quality.”
The suggestion from Ewbank is that this urgency led to both cost- and corner-cutting—most notably in the case of a backup system known as synthetic airspeed, which uses data from weather-vane-like “angle of attack” sensors to warn pilots of a potentially dangerous aerodynamic stall.
This system was not fitted on the 737 Max and, according to Ewbank, it may have been able to prevent the fatal Lion Air and Ethiopian Airlines crashes. In both incidents, preliminary accident reports found that the aircraft’s MCAS (Maneuvering Characteristics Augmentation System) flight software pushed the plane’s nose sharply down, partly as a result of receiving erroneous angle of attack sensor readings.
Ewbank—who worked on flight desk systems for the 737 Max from 2010 to 2015—also reportedly describes the aircraft’s design process as being driven “via piecemeal updates” in a company-wide effort to avoid the costs of “triggering expensive certification and (pilot) training,” the Seattle Times reports.
What’s more, he reportedly claims that Boeing hid crucial safety data from the European Union Aviation Safety Agency (EASA) after they flagged evidence of a fault with the 737 Max’s autothrottle system.
The Seattle Times reports that Ewbank then passed his own supporting evidence to a Boeing manager, only to be told to “not tell EASA” and that Boeing “would fix the issue ourselves.”
The engineer also states that his Boeing colleagues are frightened to flag-up safety concerns through “fear for their jobs” and, having blown the whistle on Boeing himself, that he is now fully aware that career repercussions may follow.
Ewbank left the company in 2015 in part because of his concerns over Boeing’s attitude to safety, reports the New York Times, but he returned to the company in November 2018 to work on systems integration testing for the Boeing 777X.
Ewbank isn’t alone in citing Boeing’s cultural shortcomings alongside analysis of the crashes. In May, former engineers Adam Dickson, Rick Ludtke and Mark Rabin all spoke out about the detrimental effects of cost-cutting within Boeing’s key engineering teams.
“They were targeting the highly paid, highly experienced engineers,”
Ludtke told Bloomberg News. “Over time that’s eroded the company’s ability to successfully design and manage programs. They do it strictly by cost, and they do it more so with every airplane.”
Rabin added that this had a particularly pernicious effect on engineers’ conversations during work hours.
“It was pretty intense low morale because of all the layoffs—constant, grinding layoffs, year after year,” Rabin told Bloomberg. “So, you really watched your step and were careful about what you said.”
Boeing stringently denied these claims in the statement to The Hill. “At no time did our performance targets reward or encourage a trade-off against safety,” a representative said.
The powers-that-be in Capitol Hill may take a different view, however.
“All of this information is critical to have as we prepare for our Committee’s October 30th hearing,” Rep. Peter DeFazio (D-Ore.), chairman of the House Transportation and Infrastructure Committee, told Reuters Wednesday following news coverage of Ewing’s complaint.
“These reports certainly add to my concern that production pressures may have impacted safety on the 737 Max, which is exactly why it’s so critical we get to the bottom of this.”
Winning back confidence
In response to the increasing criticism, Boeing last week announced the creation of a new safety group, headed by a 34-year Boeing veteran Beth Pasztor, that will “amplify our focus on safety…and intensify our focus on learning, tools and talent development across the company,” Muilenburg said in a release.
The plane maker is also establishing an aerospace safety committee on its board, led by retired Admiral Edmund Giambastiani Jr., and instituting a requirement for all future board members to have some form of safety-related experience.
This and the more than 500 test flights of an upgraded MCAS software package Boeing has conducted points to the company’s determination to win back the trust of regulators and the flying public.
“This is a defining moment for Boeing,” Muilenburg said in a July statement. “We remain focused on our enduring values of safety, quality, and integrity in all that we do, as we work to safely return the 737 Max to service.”
The question is whether Muilenburg will be able to win back not just the confidence of flyers, but also that of Boeing’s employees.
Boeing did not respond to Fortune‘s requests for comment.
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