Boeing CEO Warns Culture Shift Will Be "Brutal To Leadership"
By Mia Ping-Chieh Chen - Journalist | Simple Flying
Boeing CEO Kelly Ortberg made it clear at a company-wide meeting last week that the company's management culture needs a major change. Speaking to employees in St. Louis and via webcast to other Boeing locations, Ortberg acknowledged serious issues within the company, including poor communication and a disrespectful management culture.
According to The Seattle Times, Ortberg shared that recent employee survey results, which had an 82% response rate, would likely be "brutal" for leadership. He agreed to use this feedback to develop a clear action plan for resolving Boeing's internal issues.
"We're going to put an action plan on those things, and I think they’re going to be brutal to leadership, quite frankly," Ortberg stated. He emphasized how crucial it is to ensure that all workers, from engineers to manufacturing workers, feel free to voice their concerns without worrying about reprisals.
Ortberg's comments come as Boeing is facing tough financial challenges. In 2024, the company reported nearly $12 billion loss. Production issues with popular aircraft like the Boeing 737 Max and Boeing 787 , as well as delays with defense contracts like the Air Force One replacement, have worsened the situation. Ortberg, who became CEO in August of last year, explained that changing Boeing’s culture is key to turning things around.
Poor communication and management issues
Ortberg also told employees that the company needs a more open culture, and employees are encouraged to speak up and communicate across divisions. He answered tough questions from employees. According to Reuters, Ortberg told the employees that a shift in culture will improve morale for the corporation, which employs over 160,000 people worldwide, and "the results will show in the marketplace."
Photo:?VanderWolf Images | Shutterstock
During the meeting, one worker in Boeing's Global Services division asked about her complaints regarding a manager that had been ignored by human resources. Ortberg emphasized that while Boeing has a system called "Speak Up" for reporting issues, he wants to create a culture where employees feel comfortable talking directly to their managers.
"We're very insular," the CEO said. "We don't communicate across boundaries as well. We don't work with each other as well as we could."
'Broken all the way up the chain'
Ortberg also highlighted the need for stronger leadership across the company. He announced plans to improve leadership training and urged managers to be more engaged with their teams. He added that it's important for leaders to listen to employees and care about their concerns.
According to a corporate source who spoke to The Seattle Times, he discussed his ambitions to enhance leadership development, a sometimes rude management style, and shortcomings in internal communication. However, some people are still skeptical the management culture will change and expressed their concerns on Reddit, stating "it's broken all the way up the chain."
Tariffs could disrupt Boeing's supply chain
In addition to addressing Boeing’s internal culture, Ortberg also discussed the potential impact of tariffs recently imposed by the Trump administration, according to Bloomberg. These tariffs have the potential to significantly increase the cost of essential components sourced from Canada by Boeing, including landing gear.
The company's supply chain may see wider interruptions as a result, Ortberg said, making Boeing's already difficult production efforts even more difficult. He expressed concern that the tariffs could turn into a "continuity of supply issue," potentially driving up costs across the board and delaying production schedules.
"That's really, really expensive for us — if we're building our products and we don’t have the supply chain components," he said.
Ortberg also used the meeting to reaffirm Boeing’s efforts to collaborate with Elon Musk's Department of Government Efficiency in order to expedite the delivery of the new Air Force One aircraft for US President Donald Trump, a high-priority project amid Boeing's broader challenges.