Boeing: Poor Crisis Management or broader Weak Leadership?

After a second brand new Boeing 737 Max8 fell from the sky last week, tragically killing all aboard, the company’s CEO, Dennis A. Muilenburg phoned his pal Donald Trump and begged him to interfere to keep his best selling plane flying. True to form, the US president agreed, undoubtably stating that the airplane was the greatest ever.

When highly respected former astronaut, Canadian Minister of Transportation Marc Garneau announced that Canada would be joining others in the international community in banning the 737 Max8 from Canadian air space until the flight safety problem was solved, the FAA, America’s regulator, had to relent and grounded the troubled aircraft.

Boeing has been widely criticized in business circles this week for the weak crisis management. Dennis A. Muilenburg obviously missed reading the famous Johnson & Johnson Tylenol case when he did his management training. When consumer safety is at stake, sales volumes must take a back seat to protecting your customers.

This is at least the second recent incident of Boeing failing badly in the court of public opinion. In 2016 and 17, early in his tenure as CEO, Muilenburg launched a failed bid to keep Canada‘s Bombardier from selling 150 of it’s new C-Series passenger jets to Delta Airlines. Again he lobbied the president. The US slapped a 300% duty on Canada’s new aircraft, a move that would have effectively killed the relatively small company’s advanced plane. The most ridiculous aspect of this aggressive legal tactic was claiming that they were disadvantaged in Delta’s decision to purchase the C-Series jet despite the fact that Boeing did not even make a similar sized airplane.

Airlines were furious at this interference into their ability to competitively purchase what they needed for their fleets and so were the governments of Canada and the UK, which canceled plans to purchase billions of dollars of Boeing military aircraft, stating that the company was an unreliable partner.

The World Trade Organization (WTO) ruled the US Administration and Boeing’s tariff to be illegal and the punitive tax was struck down. Worse yet for Boeing shareholders, the crisis lead to a joint venture between Bombardier and large European rival Airbus, that saw the opening of the new C-Series assembly plant in Alabama.

A successful business leader aggressively pursues growth. Yet blind ambition in the pursuit of profit can be just as dangerous as corporate complacency. If customer safety and ethical business dealings are being ignored in the pursuit of a deal, the leader’s basic instincts must be questioned.