Case 1-9 j
Case 1: j
FAILUREjBYjDESIGN:jBOEINGjANDjTHEj737jMAXjTEACHING
jNOTE
Thisjcasejillustratesjthejfollowingjthemesjandjconceptsjdiscussedjinjthejchaptersjlisted:
Theme/Concept Chapter
ConflictjofjInterest 5
OrganizationaljEthics 6
BusinessjGovernmentjRelations;jGovernmentjRegulation 7
ProductjSafety 14
CasejSynopsis
OnjMonday,jOctoberj29,j2018,jLionjAirjFlightj610jcrashedjintojthejJavajSeajinjIndonesiajshortlyjaf
terjtakeoff,jkillingjallj189jpeoplejonjboard.j ThejaircraftjwasjajnearlyjnewjBoeingj737jMAX,jdeliver
edjtojLionjAir,jajlow-
costjregionaljcarrierjandjonejofjBoeing’sjmajorjcustomers,jjustjfourjmonthsjearlier.j ThejMAXjwasj
Boeing’sjnewestjaircraftjandjthejcenterpiecejofjthejcompany’sjstrategyjforjthejshortjtojmid-
rangejcommercialjmarket.j CEOjDennisjMuilenburgjfacedjanjurgentjanjurgentjtask:jtojdeterminejw
hatjhadjgonejwrongjandjwhyjwithjBoeing’sjnewestjandjso-
farjsuccessfuljnewjmodel.jThejcasejpresentsjthejhistoryjofjBoeingjandjitsjexternaljcompetitivejenvir
onment;jthejevolutionjofjitsjstrategy,jgovernance,jandjethicsjpractices;jandjitsjrelationshipjwithjU.S
.jregulatorsjduringjthejdesignjandjcertificationjofjthej737jMAX.j Whatjorganizationaljandjenvironm
entaljfactorsjhadjcontributedjtojBoeing’sjdevelopmentjofjanjapparentlyjunsafejaircraft?j Whatjcoul
djBoeing,jgovernmentjregulators,jandjitsjairlinejcustomers
1
©jMcGrawjHilljLLC.jAlljrightsjreserved.jNojreproductionjorjdistributionjwithoutjthejpriorjwrittenjconsentjofjMcGrawjHilljLLC.
,andjotherjstakeholdersjdojtojpreventjunsafejaircraftjfromjbeingjmanufacturedjandjsoldjinjthejfuture?
TEACHINGjTIP:jWHEREjTOjUSEjTHEjCASEjINjTHEjCOURSE
Thisjcasejisjintegrative,jinjthatjitjdrawsjonjmanyjthemesjinjthejtext.j Instructorsjmayjusejitjatjthejendj
ofjthejcoursejasjajfinal,jintegrativejassignment,jorjwithjthejstudyjofjChaptersj5jandj6j(EthicaljReason
ingjandjOrganizationaljEthics)jorjChapterj7j(BusinessjGovernmentjRelations).
TEACHINGjTIP:jVIDEO
InstructorsjmayjwishjtojintroducejthejclassjdiscussionjwithjajshortjvideojofjthejLionjAirjflight.jThejf
irstj4jminutesjofjthisj9-
minutejsegmentjdepictsjthejfataljflightjofjLionjAirj610,jinjwhichjajjournalistjridesjinjajsimulatorjwit
hjanjexperiencedj737jpilotjwhojrecreatesjthejflightjfromjthejperspectivejofjthejcockpit.j (Thejremain
derjofjthejclipjdepictsjthejEthiopianjAirlinesjcrashjandjisjnotjrelevantjtojthejcase.)j Viewersjmayjfindj
thejvideojclipjdisturbing,jevenjterrifying.
www.youtube.com/watch?v=OxPsxmU_ocI
TEACHINGjTIP:jSTARTINGjAjCASEjDISCUSSION
Onejwasjtojstartjajclassjdiscussionjofjthisjcasejisjtojaskjstudentsjtojhuddlejinjgroupsjofj2jtoj4.jGivejth
emj5jminutesjtojwritejonejorjtwojsentencesjbeginningjwith:j―OnejreasonjthatjBoeingjproducedjanj
unsafejaircraftjwas…‖j Theyjshouldjthenjhavejajrepresentativejwritejtheirjsentence(s)jonjthejboardjo
rjsharejonjajcommonjelectronicjplatform.jThejinstructorjmayjthenjcategorizejthejanswersjandjusejth
emjasjajjumpingjoffjpointjforjtakingjupjvariousjissuesjraisedjbyjthejdiscussionjquestions.
Samplejanswers:j OnejreasonjthatjBoeingjproducedjanjunsafejaircraftjwas…
ThejculturejofjBoeingjhadjshiftedjfromjajfocusjonjengineeringjexcellencejtojajfocusjonjshareholderjr
eturns.j Thejcompany’sjcapabilitiesjforjaircraftjdesignjhadjdeteriorated.
ThejFAAjdelegatedjmostjofjthejworkjofjcertifyingjthej737jMAXjtojBoeingjitself,jsojthejregulatorsjw
erejunablejtojexercisejeffectivejoversight.
BoeingjwasjunderjtremendousjpressurejbecausejofjcompetitionjfromjAirbus,jsojtheyjdecidedjtojupd
atejthej737jratherjthanjdesignjanjall-
newjplane.j Thisjcreatedjanjunsolvablejengineeringjproblem,jbecausejthejbiggerjmorejfuel-
efficientjenginesjtheyjwantedjtojusejdidjnotjfitjunderjthejwingsjofj737.
2
©jMcGrawjHilljLLC.jAlljrightsjreserved.jNojreproductionjorjdistributionjwithoutjthejpriorjwrittenjconsentjofjMcGrawjHilljLLC.
,Boeing’sjtopjexecutivesjandjdirectorsjemphasizedjshareholderjreturnsjoverjengineeringjexcellence
.j Costjandjefficiencyjwerejmorejimportantjtojthemjthanjthejqualityjofjthejaircraft.
Boeingjhadjspentjsojmuchjmoneyjonjstockjbuybacksjandjshareholderjdividendsjthatjtheyjdidjnotjha
vejenoughjleftjoverjtojinvestjproperlyjinjR&Djandjaircraftjengineering.
Boeingjhadjajcodejofjethicsjbutjdidjnotjseemjtojenforcejit.j Itjignoredjworrisomejsurveyjresultsjandjd
idjnotjlistenjtojseriesjwarningsjfromjseniorjmanagers.
ManufacturingjofjthejMAXjwasjrushed,jpossiblyjleadingjtojdefectsjinjaircraftjdeliveredjtojcustomer
s.
ThejFAAjbasicallyjallowedjBoeingjtojcertifyjthejsafetyjofjitsjownjplane.
Boeing’sjstrategyjwasjtojacquirejotherjmanufacturersj(e.g.,jMcDonnelljDouglas)jandjkeepjupdatin
gjtheirjoldjmodels,jratherjthanjtojdesignjnewjaircraft.j Overjthejyears,jtheyjlostjmuchjofjtheirjenginee
ringjknow-how.
InstructorjTip:j ―C‖jstudentsjmayjanswerjthisjquestionjbyjdescribingjcharacteristicsjofjthejunsafejpl
anejorjitsjdesignjflaws.j Forjexample,j―OnejreasonjBoeingjproducedjanjunsafejaircraftjwasjrelyingj
onjjustjonejsensor.‖j ―A‖jstudentsjwilljunderstandjthejdistinctionjbetweenjthejproblemjitselfj(anjuns
afejdesign)jandjthejcausejofjthejproblemj(e.g.,jorganizationaljculture,jregulatoryjfailures,jexternaljc
ompetition).j ThejinstructorjmayjneedjtojpointjoutjthatjthejquestionjasksjforjthejreasonjBoeingjprod
ucedjanjunsafejplane,jnotjthejreasonjthejplanejwasjunsafe.j(Questionj1,jbelow,jaddressesjthejreason(
s)jthejplanejwasjunsafe.)
DiscussionjQuestionsjandjAnswers
1. WhatjwerejthejimmediatejtechnicaljcausesjofjthejcrashjofjLionjAirjFlightj610?
Basedjonjinformationjinjthejcase,jstudentsjwilljconclude:jAjfaultyjanglejofjattackjsensorjfedjerro
neousjdatajintojthejplane’sjcomputers,jtriggeringjthejmaneuveringjcharacteristicsjaugmentationjsys
tem,jorjMCAS.j Thejplane’sjcomputerjreliedjonjonlyjonejsensorjatjajtimej(ajsinglejpointjofjfailure),j
andjthejaircraftjdidjnotjhavejanjactivejcockpitjalertjforjdisagreementjbetweenjthejtwojsensors.j Once
jMCASjwasjactivated,jitjrepeatedlyjforcedjthejnosejofjthejplanejdown,jdestabilizingjthejaircraft.j Th
ejLionjAirjpilotsjhadjnotjbeenjtrainedjonjajsimulator,jwerejunawarejofjMCASjandjitsjcapabilities,ja
ndjtheirjflightjmanualjdidjnotjincludejrelevantjinformation.j Eventually,jthejpilotsjlostjcontroljofjthej
aircraftjandjitjcrashedjnosejdownjintojthejsea,jkillingjalljonjboard.
2. DescribejthejculturejofjthejBoeingjorganization.j Howjdidjthejcompany’sjculturejaffectjt
hejdevelopmentjandjproductionjofjthej737jMAX?
3
©jMcGrawjHilljLLC.jAlljrightsjreserved.jNojreproductionjorjdistributionjwithoutjthejpriorjwrittenjconsentjofjMcGrawjHilljLLC.
, Thejtextbookjdefinesjcorporatejculturejasj―ajblendjofjideas,jcustoms,jtraditionaljpractices,jcompa
nyjrules,jandjsharedjmeaningsjthatjhelpjdefinejnormaljbehaviorjforjeveryonejwhojworksjatjajcomp
any‖j(Chapterj6).jThejtextbookjpointsjoutjthatjweakjethicaljculturesjcanjfosterjunethicaljbehavior.j
Tojhelpjstudentsjunpackjthisjquestion,jthejinstructorjmayjwishjtojelaboratejbyjpointingjoutjthatjcor
poratejorjorganizationaljculturejisjoftenjunderstoodjasjhavingjthreejlayers:jbasicjassumptions,jvalu
esjandjnorms,jandjartifactsj(Schein,j2004;jChatman,j2014).
Basicjassumptionsjarejdeeplyjheldjvaluesjaboutjthejorganization’sjpurposejandjreasonjforjexistence
.j Normsjarejunwrittenjexpectationsjforjappropriatejbehaviorjthatjreflectjthesejvalues.jArtifactsjarejv
isiblejorganizationaljpracticesjthatjcommunicatejvalues,jsuchjasjrituals,jstories,jandjlanguage.
Onejwayjtojorganizejthisjdiscussionjisjtojpromptjstudentsjtojfilljinjajboardjgrid,jshowingjhowjthesejt
hreejlayersjofjBoeing’sjculturejchangedjfollowingjthejcompany’sjacquisitionjofjMcDonnelljDougl
asj(1997).
Boeing’sjOrganizationaljCulturejBeforejandjAfterjthejAcquisitionjofjMcDonnelljDouglas
Level Past Present
BasicjAssumptions BoeingjisjajtrendsetterjinjaircraftjtechnolBoeingjisjanjaircraftjmanufacturer.
ogy.j Thejpurposejofjthejcompanyjisjtojde j Thejcompany’sjpurposejisjtojcrea
signjbetterjplanesjthatjflyjhigher,jfaster,jf
tejthejbestjvaluejforjitsjcustomersja
arther. ndjthejhighestjpossiblejreturnsjforj
itsjinvestors.
Shareholderjvaluejisjprioritized.
ValuesjandjNorms Corejvaluesjarejquality,jinnovation,jand Corejvaluesjarejefficiency,jprofitabi
jsafety.j Engineeringjexcellencejis lity,jandjlowjcost.jShareholderjvalue
valued.jInvestmentjinjresearchjandjdevel jisjprioritized.
opmentjisjprioritized.
Artifacts StoriesjaboutjWilliamjBoeing’sjattentio Commonjslogansjwerej―We’rejinj
njtojquality,jinnovation,jandjsafetyjwerej business‖jandj―We’rejmanagingj
partjofjthejcompany forjvalue.‖
folklore.j Thejcompanyjwasjdescribedja
sjanj―associationjofjengineers.‖
Summary:j Overjtime,jBoeingjculturejhadjshiftedjfromjajfocusjonjquality,jinnovation,jandjsafetyjt
ojajfocusjonjefficiency,jprofitability,jandjshareholderjvalue.j Thisjaffectedjthejdevelopmentjofjthej
737jMAX,jasjitjledjtojdecisionsjtojre-tooljanjoldjmodelj(thej737)jratherjdevelopjthanjajnew,jclean-
sheetjmodel,jtojkeepjcostsjdownjandjspeedjupjdeliveryjtojkeyjcustomers.j(ThejdecisionsjmadejbyjB
oeingjduringjthejdevelopmentjofjthejMAXjarejfurtherjexploredjinjthejresponsejtojQuestionj4,jbelo
w.)
3. DescribejthejethicsjpoliciesjandjpracticesjofjBoeing.j Whatjethicaljsafeguardsjwerejinjp
lacejtojpromotejsafety?j Evaluatejthejeffectivenessjofjthesejsafeguardsjduringjthejdevel
opmentjandjproductionjofjthej737jMAX.
4
©jMcGrawjHilljLLC.jAlljrightsjreserved.jNojreproductionjorjdistributionjwithoutjthejpriorjwrittenjconsentjofjMcGrawjHilljLLC.
Case 1: j
FAILUREjBYjDESIGN:jBOEINGjANDjTHEj737jMAXjTEACHING
jNOTE
Thisjcasejillustratesjthejfollowingjthemesjandjconceptsjdiscussedjinjthejchaptersjlisted:
Theme/Concept Chapter
ConflictjofjInterest 5
OrganizationaljEthics 6
BusinessjGovernmentjRelations;jGovernmentjRegulation 7
ProductjSafety 14
CasejSynopsis
OnjMonday,jOctoberj29,j2018,jLionjAirjFlightj610jcrashedjintojthejJavajSeajinjIndonesiajshortlyjaf
terjtakeoff,jkillingjallj189jpeoplejonjboard.j ThejaircraftjwasjajnearlyjnewjBoeingj737jMAX,jdeliver
edjtojLionjAir,jajlow-
costjregionaljcarrierjandjonejofjBoeing’sjmajorjcustomers,jjustjfourjmonthsjearlier.j ThejMAXjwasj
Boeing’sjnewestjaircraftjandjthejcenterpiecejofjthejcompany’sjstrategyjforjthejshortjtojmid-
rangejcommercialjmarket.j CEOjDennisjMuilenburgjfacedjanjurgentjanjurgentjtask:jtojdeterminejw
hatjhadjgonejwrongjandjwhyjwithjBoeing’sjnewestjandjso-
farjsuccessfuljnewjmodel.jThejcasejpresentsjthejhistoryjofjBoeingjandjitsjexternaljcompetitivejenvir
onment;jthejevolutionjofjitsjstrategy,jgovernance,jandjethicsjpractices;jandjitsjrelationshipjwithjU.S
.jregulatorsjduringjthejdesignjandjcertificationjofjthej737jMAX.j Whatjorganizationaljandjenvironm
entaljfactorsjhadjcontributedjtojBoeing’sjdevelopmentjofjanjapparentlyjunsafejaircraft?j Whatjcoul
djBoeing,jgovernmentjregulators,jandjitsjairlinejcustomers
1
©jMcGrawjHilljLLC.jAlljrightsjreserved.jNojreproductionjorjdistributionjwithoutjthejpriorjwrittenjconsentjofjMcGrawjHilljLLC.
,andjotherjstakeholdersjdojtojpreventjunsafejaircraftjfromjbeingjmanufacturedjandjsoldjinjthejfuture?
TEACHINGjTIP:jWHEREjTOjUSEjTHEjCASEjINjTHEjCOURSE
Thisjcasejisjintegrative,jinjthatjitjdrawsjonjmanyjthemesjinjthejtext.j Instructorsjmayjusejitjatjthejendj
ofjthejcoursejasjajfinal,jintegrativejassignment,jorjwithjthejstudyjofjChaptersj5jandj6j(EthicaljReason
ingjandjOrganizationaljEthics)jorjChapterj7j(BusinessjGovernmentjRelations).
TEACHINGjTIP:jVIDEO
InstructorsjmayjwishjtojintroducejthejclassjdiscussionjwithjajshortjvideojofjthejLionjAirjflight.jThejf
irstj4jminutesjofjthisj9-
minutejsegmentjdepictsjthejfataljflightjofjLionjAirj610,jinjwhichjajjournalistjridesjinjajsimulatorjwit
hjanjexperiencedj737jpilotjwhojrecreatesjthejflightjfromjthejperspectivejofjthejcockpit.j (Thejremain
derjofjthejclipjdepictsjthejEthiopianjAirlinesjcrashjandjisjnotjrelevantjtojthejcase.)j Viewersjmayjfindj
thejvideojclipjdisturbing,jevenjterrifying.
www.youtube.com/watch?v=OxPsxmU_ocI
TEACHINGjTIP:jSTARTINGjAjCASEjDISCUSSION
Onejwasjtojstartjajclassjdiscussionjofjthisjcasejisjtojaskjstudentsjtojhuddlejinjgroupsjofj2jtoj4.jGivejth
emj5jminutesjtojwritejonejorjtwojsentencesjbeginningjwith:j―OnejreasonjthatjBoeingjproducedjanj
unsafejaircraftjwas…‖j Theyjshouldjthenjhavejajrepresentativejwritejtheirjsentence(s)jonjthejboardjo
rjsharejonjajcommonjelectronicjplatform.jThejinstructorjmayjthenjcategorizejthejanswersjandjusejth
emjasjajjumpingjoffjpointjforjtakingjupjvariousjissuesjraisedjbyjthejdiscussionjquestions.
Samplejanswers:j OnejreasonjthatjBoeingjproducedjanjunsafejaircraftjwas…
ThejculturejofjBoeingjhadjshiftedjfromjajfocusjonjengineeringjexcellencejtojajfocusjonjshareholderjr
eturns.j Thejcompany’sjcapabilitiesjforjaircraftjdesignjhadjdeteriorated.
ThejFAAjdelegatedjmostjofjthejworkjofjcertifyingjthej737jMAXjtojBoeingjitself,jsojthejregulatorsjw
erejunablejtojexercisejeffectivejoversight.
BoeingjwasjunderjtremendousjpressurejbecausejofjcompetitionjfromjAirbus,jsojtheyjdecidedjtojupd
atejthej737jratherjthanjdesignjanjall-
newjplane.j Thisjcreatedjanjunsolvablejengineeringjproblem,jbecausejthejbiggerjmorejfuel-
efficientjenginesjtheyjwantedjtojusejdidjnotjfitjunderjthejwingsjofj737.
2
©jMcGrawjHilljLLC.jAlljrightsjreserved.jNojreproductionjorjdistributionjwithoutjthejpriorjwrittenjconsentjofjMcGrawjHilljLLC.
,Boeing’sjtopjexecutivesjandjdirectorsjemphasizedjshareholderjreturnsjoverjengineeringjexcellence
.j Costjandjefficiencyjwerejmorejimportantjtojthemjthanjthejqualityjofjthejaircraft.
Boeingjhadjspentjsojmuchjmoneyjonjstockjbuybacksjandjshareholderjdividendsjthatjtheyjdidjnotjha
vejenoughjleftjoverjtojinvestjproperlyjinjR&Djandjaircraftjengineering.
Boeingjhadjajcodejofjethicsjbutjdidjnotjseemjtojenforcejit.j Itjignoredjworrisomejsurveyjresultsjandjd
idjnotjlistenjtojseriesjwarningsjfromjseniorjmanagers.
ManufacturingjofjthejMAXjwasjrushed,jpossiblyjleadingjtojdefectsjinjaircraftjdeliveredjtojcustomer
s.
ThejFAAjbasicallyjallowedjBoeingjtojcertifyjthejsafetyjofjitsjownjplane.
Boeing’sjstrategyjwasjtojacquirejotherjmanufacturersj(e.g.,jMcDonnelljDouglas)jandjkeepjupdatin
gjtheirjoldjmodels,jratherjthanjtojdesignjnewjaircraft.j Overjthejyears,jtheyjlostjmuchjofjtheirjenginee
ringjknow-how.
InstructorjTip:j ―C‖jstudentsjmayjanswerjthisjquestionjbyjdescribingjcharacteristicsjofjthejunsafejpl
anejorjitsjdesignjflaws.j Forjexample,j―OnejreasonjBoeingjproducedjanjunsafejaircraftjwasjrelyingj
onjjustjonejsensor.‖j ―A‖jstudentsjwilljunderstandjthejdistinctionjbetweenjthejproblemjitselfj(anjuns
afejdesign)jandjthejcausejofjthejproblemj(e.g.,jorganizationaljculture,jregulatoryjfailures,jexternaljc
ompetition).j ThejinstructorjmayjneedjtojpointjoutjthatjthejquestionjasksjforjthejreasonjBoeingjprod
ucedjanjunsafejplane,jnotjthejreasonjthejplanejwasjunsafe.j(Questionj1,jbelow,jaddressesjthejreason(
s)jthejplanejwasjunsafe.)
DiscussionjQuestionsjandjAnswers
1. WhatjwerejthejimmediatejtechnicaljcausesjofjthejcrashjofjLionjAirjFlightj610?
Basedjonjinformationjinjthejcase,jstudentsjwilljconclude:jAjfaultyjanglejofjattackjsensorjfedjerro
neousjdatajintojthejplane’sjcomputers,jtriggeringjthejmaneuveringjcharacteristicsjaugmentationjsys
tem,jorjMCAS.j Thejplane’sjcomputerjreliedjonjonlyjonejsensorjatjajtimej(ajsinglejpointjofjfailure),j
andjthejaircraftjdidjnotjhavejanjactivejcockpitjalertjforjdisagreementjbetweenjthejtwojsensors.j Once
jMCASjwasjactivated,jitjrepeatedlyjforcedjthejnosejofjthejplanejdown,jdestabilizingjthejaircraft.j Th
ejLionjAirjpilotsjhadjnotjbeenjtrainedjonjajsimulator,jwerejunawarejofjMCASjandjitsjcapabilities,ja
ndjtheirjflightjmanualjdidjnotjincludejrelevantjinformation.j Eventually,jthejpilotsjlostjcontroljofjthej
aircraftjandjitjcrashedjnosejdownjintojthejsea,jkillingjalljonjboard.
2. DescribejthejculturejofjthejBoeingjorganization.j Howjdidjthejcompany’sjculturejaffectjt
hejdevelopmentjandjproductionjofjthej737jMAX?
3
©jMcGrawjHilljLLC.jAlljrightsjreserved.jNojreproductionjorjdistributionjwithoutjthejpriorjwrittenjconsentjofjMcGrawjHilljLLC.
, Thejtextbookjdefinesjcorporatejculturejasj―ajblendjofjideas,jcustoms,jtraditionaljpractices,jcompa
nyjrules,jandjsharedjmeaningsjthatjhelpjdefinejnormaljbehaviorjforjeveryonejwhojworksjatjajcomp
any‖j(Chapterj6).jThejtextbookjpointsjoutjthatjweakjethicaljculturesjcanjfosterjunethicaljbehavior.j
Tojhelpjstudentsjunpackjthisjquestion,jthejinstructorjmayjwishjtojelaboratejbyjpointingjoutjthatjcor
poratejorjorganizationaljculturejisjoftenjunderstoodjasjhavingjthreejlayers:jbasicjassumptions,jvalu
esjandjnorms,jandjartifactsj(Schein,j2004;jChatman,j2014).
Basicjassumptionsjarejdeeplyjheldjvaluesjaboutjthejorganization’sjpurposejandjreasonjforjexistence
.j Normsjarejunwrittenjexpectationsjforjappropriatejbehaviorjthatjreflectjthesejvalues.jArtifactsjarejv
isiblejorganizationaljpracticesjthatjcommunicatejvalues,jsuchjasjrituals,jstories,jandjlanguage.
Onejwayjtojorganizejthisjdiscussionjisjtojpromptjstudentsjtojfilljinjajboardjgrid,jshowingjhowjthesejt
hreejlayersjofjBoeing’sjculturejchangedjfollowingjthejcompany’sjacquisitionjofjMcDonnelljDougl
asj(1997).
Boeing’sjOrganizationaljCulturejBeforejandjAfterjthejAcquisitionjofjMcDonnelljDouglas
Level Past Present
BasicjAssumptions BoeingjisjajtrendsetterjinjaircraftjtechnolBoeingjisjanjaircraftjmanufacturer.
ogy.j Thejpurposejofjthejcompanyjisjtojde j Thejcompany’sjpurposejisjtojcrea
signjbetterjplanesjthatjflyjhigher,jfaster,jf
tejthejbestjvaluejforjitsjcustomersja
arther. ndjthejhighestjpossiblejreturnsjforj
itsjinvestors.
Shareholderjvaluejisjprioritized.
ValuesjandjNorms Corejvaluesjarejquality,jinnovation,jand Corejvaluesjarejefficiency,jprofitabi
jsafety.j Engineeringjexcellencejis lity,jandjlowjcost.jShareholderjvalue
valued.jInvestmentjinjresearchjandjdevel jisjprioritized.
opmentjisjprioritized.
Artifacts StoriesjaboutjWilliamjBoeing’sjattentio Commonjslogansjwerej―We’rejinj
njtojquality,jinnovation,jandjsafetyjwerej business‖jandj―We’rejmanagingj
partjofjthejcompany forjvalue.‖
folklore.j Thejcompanyjwasjdescribedja
sjanj―associationjofjengineers.‖
Summary:j Overjtime,jBoeingjculturejhadjshiftedjfromjajfocusjonjquality,jinnovation,jandjsafetyjt
ojajfocusjonjefficiency,jprofitability,jandjshareholderjvalue.j Thisjaffectedjthejdevelopmentjofjthej
737jMAX,jasjitjledjtojdecisionsjtojre-tooljanjoldjmodelj(thej737)jratherjdevelopjthanjajnew,jclean-
sheetjmodel,jtojkeepjcostsjdownjandjspeedjupjdeliveryjtojkeyjcustomers.j(ThejdecisionsjmadejbyjB
oeingjduringjthejdevelopmentjofjthejMAXjarejfurtherjexploredjinjthejresponsejtojQuestionj4,jbelo
w.)
3. DescribejthejethicsjpoliciesjandjpracticesjofjBoeing.j Whatjethicaljsafeguardsjwerejinjp
lacejtojpromotejsafety?j Evaluatejthejeffectivenessjofjthesejsafeguardsjduringjthejdevel
opmentjandjproductionjofjthej737jMAX.
4
©jMcGrawjHilljLLC.jAlljrightsjreserved.jNojreproductionjorjdistributionjwithoutjthejpriorjwrittenjconsentjofjMcGrawjHilljLLC.
