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Making Changes vs Solving Problems

Last week, we looked at the issues facing Boeing as a case study in how to drill down to the root cause of a problem and then formulate a plan for fixing it.  Indeed, for decades, the names Boeing and quality were synonymous. The company was a titan of industry, designing and building aircraft that pushed the boundaries of human exploration. However, a series of catastrophic failures in recent years has cast a long shadow over this once-impeccable reputation.

So what steps are needed for Boeing – or any company experiencing a major quality breakdown and crisis of confidence — to not only overcome a persistent quality control issue but also emerge stronger and more resilient. Using Boeing as a case in point, let’s outline a strategic approach that can be applied to any organization facing a major challenge.

Step 1: Acknowledgement and Acceptance

The first, and perhaps most crucial, step is a candid and comprehensive acknowledgment of the problem. This involves a deep-dive into the issue, identifying its root causes, and accepting full responsibility. For Boeing, this meant acknowledging the systemic failures that led to the 737 MAX crashes, including issues with maintenance, design, and flight control software and a corporate culture that prioritized production over safety. This step is not about assigning blame but about creating a foundation for trust. It requires transparency, humility, and a genuine commitment to change.

Step 2: Crisis Management

The immediate aftermath of a crisis demands swift and decisive action. This involves containing the damage, communicating openly with stakeholders, and prioritizing safety. For Boeing, this meant grounding the 737 MAX fleet, cooperating fully with investigations, and providing support to the victims’ families.  While crisis management is essential, it’s important to remember that it is a temporary measure. The focus should quickly shift to long-term solutions.

Step 3: Cultural Transformation

A crisis often reveals deep-rooted cultural issues. For Boeing, it became clear that a culture of safety had been compromised by pressures to meet production targets and financial goals. To rectify this, a fundamental cultural overhaul is necessary. This involved:  

• Redefining core values: Safety, integrity, and customer focus needed to be at the heart of the new culture.
• Leadership development: Cultivating leaders who embodied the new values was critical.
• Employee empowerment: Creating an environment where employees felt safe to raise concerns was essential.
• Ethical conduct: Establishing clear ethical guidelines and enforcing them rigorously.

Step 4: Independent Investigation

To restore credibility, an independent and thorough investigation is imperative. This should involve external experts who can provide an unbiased assessment of the situation. Boeing commissioned such an investigation into the 737 MAX crashes, which led to significant recommendations.

Step 5: Process Reengineering

A crisis often exposes flaws in existing processes. For Boeing, it was clear that the certification process for new aircraft needed to be more rigorous. This involved:

• Streamlining processes: Eliminating unnecessary bureaucracy and improving efficiency.  Boeing announced sweeping changes to its leadership.  Its chief executive, Dave Calhoun, who took the job in January 2020 vowing to improve the company’s safety culture, will step down at the end of 2024.  The head of Boeing’s commercial airplane unit, Stan Deal, is leaving immediately.  And Board Chairman, Larry Kellner, has stepped down from that position and will not seek re-election to the Board.

• Quality control: Implementing robust quality control measures at every stage of production.  To that end, Boeing announced several additional steps to improve quality, including adding inspections at its factory in Renton, Wash., where Max planes are assembled.

It has also said it will no longer accept Max bodies from Spirit AeroSystems, a key supplier based in Wichita, Kan., that still need work. It previously tolerated flaws that could be fixed later in the interest of adhering to a tight production schedule.

• Risk assessment: Developing a comprehensive system for identifying and mitigating risks.  For instance, since the Jan. 5 door debacle, employees have asked for more training and Boeing was working on meeting those needs, including adding training on the factory floor this month.

Step 6: Technology and Innovation

In today’s world, technology can be a powerful tool for problem-solving. For Boeing, this meant investing in advanced manufacturing techniques, data analytics, and simulation to improve product safety and reliability.

Step 7: Stakeholder Engagement

At Boeing, rebuilding trust will require open and honest communication with all stakeholders, including customers, employees, investors, and regulators going forward. This will involve:

• Transparency: Sharing information openly and honestly.
• Listening: Actively seeking feedback from stakeholders.
• Partnership: Collaborating with stakeholders to find solutions.

Step 8: Continuous Improvement

Crisis recovery is not a one-time event. It is an ongoing process of learning and improvement. For Boeing, this involves:

• Performance metrics: Establishing key performance indicators to measure progress.
• Employee feedback: Creating channels for employees to share ideas and concerns.  That is very much a return to Boeing’s roots as embraced by the company’s founder.
• Customer satisfaction: Monitoring customer satisfaction and addressing issues promptly.

Lessons from Other Industries

Boeing is not alone in facing a business crisis so serious that it induced a crisis of confidence that seriously hurt the brand and could have potentially destroyed it.  Companies like Tylenol, Dennys, Jack in the Box, Union Carbide, NASA, and, most recently, Delta have experienced similar challenges that were caused by either external or internal forces.

Let’s examine one of these parallels more closely.  Of the six organizations listed, the one whose crisis was most like Boeing’s was that of NASA.  On January 28, 1986, NASA launched the Space Shuttle Challenger.  Millions of people around the world – including many schoolchildren — watched as the shuttle took off carrying a crew that included schoolteacher Christa McAuliffe, America’s first private citizen scheduled to go into space.  Tragically, 75 seconds into the flight tragedy struck. Eleven miles above the earth fire leaked from one of the booster seals and Challenger erupted into flames.  All lives onboard were lost. 

After an investigation, it was determined that the fault lay in NASA knowingly launching the shuttle despite the especially cold weather.  Engineers did not know how that degree of cold would affect the shuttle’s functionality.  They discussed it and chose to launch anyway.  NASA experienced its first major crisis in 19 years.  The previous one had been the explosion on the launch pad of the Apollo Program on January 27, 1967.

How well did NASA follow the steps for managing and fixing the problem?  Initially not well, but in time the organization improved.

Step 1: Acknowledgement and Acceptance

NASA’s initial handling of information to the media created suspicion and distrust.  Lawrence Mulloy, manager of the NASA booster rocket program, was believed to have lied about having prior knowledge that the weather was too cold for a safe launch.  The Presidential Commission’s report implied that Mulloy was less than truthful, further eroding NASA’s credibility in the eyes of the American public.  In fact, a month after the Challenger exploded, the Los Angeles Times’ survey about Americans confidence in the space program found that, although most Americans remained supportive of the space program, they had lost trust in NASA.  Most of those surveyed cited NASA’s decision to launch as the primary reason for the loss of confidence.  After an inability to acknowledge and accept responsibility, all crisis management efforts were turned over to the White House.

Step 2: Crisis Management

President Ronald Reagan chose inspiring words during his tribute to the gallant Challenger crew.  Indeed, in his address to the nation, President Reagan said, “It’s all part of the process of exploration and discovery. The future doesn’t belong to the fainthearted; it belongs to the brave.”  Reagan likened their dedication to that of the great explorer Sir Francis Drake, who died aboard a ship off the coast of Panama. The President also encouraged parents to sit down and talk to their children about the disaster. Reagan told parents to explain that these men and women had a hunger to explore the universe for the betterment of mankind. They were given a challenge and they met it with joy. Although sad, they died serving us, serving their country.   He added that the shuttle flights would continue and more volunteers, civilians and even more schoolteachers would travel into space.  Framing the astronauts as pioneers and heroes by the president and media saved public confidence in the space program. The program survived the public distrust in the organization itself.

Step 3: Cultural Transformation

This crisis revealed deep-rooted cultural issues within NASA.  A fundamental cultural overhaul was needed.  They needed to: 

• Redefine their core values: Safety and integrity needed to be at the heart of the new culture.
• Leadership development: Cultivating leaders who embodied the new values was critical.
• Ethical conduct:  They needed to establish clear ethical guidelines and enforce them rigorously.

It took years for NASA to regain its credibility.  A decade after the disaster many media outlets looked back at the tragedy. Most agree that it is now viewed as a turning point for NASA.

Step 4: Independent Investigation

To restore credibility, an independent and thorough investigation was imperative.  The Presidential Commission report revealed all of NASA’s mistakes and made them public knowledge. NASA had no choice but to rebuild their organization after its mistakes were published in the Presidential Commission report. 

Step 5: Process Reengineering

For NASA to gain forgiveness from the public they had to rectify the problems with the shuttle program and their own decision-making process. Their addressing of every issue in the commission’s report showed their acknowledgement that the system was broke.

NASA ordered safety changes from stem to stern on the space shuttle fleet. The O-ring seals were redesigned. Engineers fashioned a rudimentary escape system that would allow the crew to bail out if the plane was heading for an impact over the ocean. The safety team of managers was expanded to include independent safety experts, private contractors, and mission managers to supervise the countdowns.

Step 6: Technology and Innovation

For the space program itself, most agree the Challenger tragedy brought positive changes, including an improved safety record and restoration of public confidence.

Step 7: Stakeholder Engagement

Since then, NASA has rebuilt trust by providing open and honest communication with all stakeholders, including the media, public, vendors, and regulators.  They increased:

• Transparency: Sharing information openly and honestly.
• Listening: Actively seeking feedback from stakeholders.
• Partnership: Collaborating with stakeholders to find solutions.

Step 8: Continuous Improvement

Last but not least, NASA – which had always had a culture of exploration — also embraced a process of learning and improvement.  This has involved:

• Performance metrics: Establishing key performance indicators to measure progress.
• Inhouse and vendor feedback: Creating channels for employees and vendors to share ideas and concerns. 

Neither Boeing nor NASA were the first or will be the last organizations to experience major problems that did have an easy fix.  Most recently, Delta Airlines experienced a major IT outage caused by issues with Crowdstrike and Microsoft software. While the root cause was different, the steps taken to recover have been similar to those outlined above.

Overcoming a major crisis is undoubtedly a daunting task. However, it is also an opportunity for renewal and growth. By following the eight steps, companies can not only survive a crisis but emerge stronger and more resilient. It is a journey that requires courage, determination, and a long-term perspective.  The road to recovery is not easy, but it is possible. With the right approach, even the most complex problems can be solved.

Quote of the Week
“We cannot solve our problems with the same thinking we used when we created them.” Albert Einstein

© 2024, Keren Peters-Atkinson. All rights reserved.