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Delta Airlines has improved drastically, both financially and in terms of the product since their current CEO, Ed Bastien who is an accountant, took over. Mean

Delta Airlines has improved drastically, both financially and in terms of the product since their current CEO, Ed Bastien who is an accountant, took over. Meanwhile, Boeing sold deadly products under leadership by their engineer CEO. I see the "bean counter bad" narrative a lot here, but I don't think it's that black and white.

CamperBob2 4y ago
The decisionmaking behind those deadly products happened long before the CEO in question came on board.
rocqua 4y ago
Reportedly at Boeing the culture at the executive level remains 'bean-counter focussed'. Does the opposite hold for Delta Airlines? It seems to me like the disposition of the CEO matters a lot more than their formal background. If an engineer rose through the ranks by siding with the MBA/accountants/bean-counting-culture in a company, he is likely to run it in the (presumably correctly maligned) bean-counting ways. Whereas an accountant who understands the bean-counters but has seen the pitfalls of that kind of management could easily decide not to manage like a bean-counter.
- fnordpiglet 4y ago
  I think it’s also a canard that the CEO is in charge. They’re responsible, but often the CFO or COO are in charge, or some rule class culture of middle management. My understanding from engineers at Boeing it has not had engineers in charge for a long time and it’s entirely run by accountants and business development.
- robszumski 4y ago
  One cool fact is that prior to running Red Hat, Jim Whitehurst was COO of Delta Airlines. He could absolutely talk the talk on open source software. I always thought that was cool.
dralley 4y ago
"When people say I changed the culture of Boeing, that was the intent, so that it’s run like a business rather than a great engineering firm. It is a great engineering firm, but people invest in a company because they want to make money." - Harry Stonecipher, Boeing executive and CEO until 2005 https://www.chicagotribune.com/chi-0402290256feb29-story.html https://www.chicagotribune.com/chi-0402290256feb29-story.htm...
AceyMan 4y ago
iirc, Ed is a career DAL employee who bootstrapped to the CEO position, so while he's not an ops guy, per se, he still "gets" Delta and what makes it the company it is. That's a trait I suspect you'll find makes in every successful chief executive, irrespective of the industry.
fnordpiglet 4y ago
Any sufficiently broad generalization is always wrong.
antihero 4y ago
> Boeing sold deadly products under leadership by their engineer CEO. I remember hearing I think in a documentary that the merger with McDonall-Douglas made it have a more business-y culture that lead the the terrible failures.
- wahern 4y ago
  McDonnell-Douglas is often blamed for changing the Boeing culture, but it was the Boeing CEO Philip Condit who led the deal, and more importantly helped engineer the cultural takeover by strategically placing McDonnell-Douglas executives in key positions. Condit was at one point a lead engineer at Boeing, but was deliberately chosen by the Boeing board (at least the majority faction) precisely because they knew what he wanted to do with the company. The person who pushed back the hardest against the McDonnell-Douglas merger was the Boeing CFO Boyd Givan. He was quickly ousted not long after the deal was finalized, accused of being too financially conservative compared to McDonnell-Douglas' M.O.: https://archive.seattletimes.com/archive/?date=19980715&slug=2761320 https://archive.seattletimes.com/archive/?date=19980715&slug... The blame ultimately rests with the Boeing board. There was a minority faction on the board that fought tooth-and-nail. They couldn't stop it, but IIRC their concession (to prevent the minority from creating a ruckus in public) was being able to keep Givan as CFO after the merger. But Condit ensured that that didn't last long by undermining Givan at every turn, which was probably the plan of the majority board faction all along. Based on this and a few other anecdotes, and if we're making wild speculations, I'd say that whether a CFO makes a good CEO depends on the type of CFO. There's the traditional CFO--the "bean counter"--whose job is to manage the money and keep a low profile so the rest of the company can do their thing. Then there are the new generations of CFO, which started coming up the ranks in the 1970s and 1980s (see, e.g., McDonnell-Douglas), who see creative accounting (aka financial engineering) as a legitimate way to boost stockholder value and an end in itself, independent of a company's core competency. If a company has good bones, a traditional CFO can make a great steward at the very least. For the new type of CFO, they often couldn't care less about a company's core competency, and are more speculator than bean counter, at least in the traditional meanings of those terms.
Retric 4y ago
Find accountants are actually much better at C* positions than MBA’s. It seems like there should be a lot of overlap, but I think accountants have a better grasp of the underlying business reality. Or at lest the idea that you can’t get something for nothing so saving money on X likely costs you elsewhere.
dv_dt 4y ago
The Boeing engineer CEO who replaced the accountant CEO (one of the first in Boeing history) under which most of the preliminary design of the deadly product was performed.
mattcantstop 4y ago
A company named Apple seems to be doing well with the logistics guy at the helm as well.
- wwweston 4y ago
  They're making money, that's for certain. They're not making new product categories and markets like they used to, though, just iterations on things they were already doing well enough (and sometimes those iterations take away more than give). Their established capital and position in the market are their strength more than any other particular vision or talent on display. That's enough to keep them strong for a long time on logistics. Not sure what happens if they face a well-funded vision challenger.
mandevil 4y ago
The most important bad decisions in the Boeing case were made in 2011-13, when they promised that the 737 Max would not require a new type certificate for someone with a 737 cert already, and that it would use the new, larger, and more efficient engines. At that point in time, the CEO of Boeing was James McNerney, who had a Harvard MBA, worked at P&G and McKinsey, then spent 20 years at GE (running their airplane engine business). When he lost the race to succeed Jack Welsh he went to 3M and then was picked to run Boeing. At the time that these key bad decisions were made for the 737 Max, Dennis Muilenberg- the engineer you cite- was running the Boeing Integrated Defense side of the house and had no authority on the 737 Max. He does bear some responsibility for the Max- he was CEO when it first flew, got certified, was delivered to customers, and the first crash that was not investigated with appropriate speed- but the most important bad decision was made when a MBA was running the company. International airliners and semiconductors are two areas where I've become convinced that engineering CEO's are required, because they both involve making 10 billion or more dollar investments that won't even enter the market for more than 5 years. So you need someone with a very good feel for technological possibility, one who understands that you can't bafflegab mother nature the way that Harvard's MBA school teaches you to. It's possible I'm over-indexing on Boeing and Intel: Airbus' big recent fiasco- though since it didn't kill anyone it's not nearly as big as the 737 Max- the A380, was largely a commercial failure not an engineering one (by some estimates the A380 never even turned a profit on fly-away costs, totally ignoring development costs). So maybe having Harvard MBA's and market people would have saved them. On the other hand, when those key decisions were made (2000 was when the A3XX was approved) Airbus had a convoluted two CEO-two Chairman structure designed (to this American's jaded eye) to prevent any personal responsibility from leaching back to the bosses, so I can't tell you who was in charge when the wrong decisions were made for that program.
mox1 4y ago
The airline industry is more or less an oligopoly and perhaps even a commodity service, so growing market share kinda means not sucking. The basic experience of an airplane (getting from point A to point B quickly) hasn't changed much. I can see how a MBA / spreadsheet type at the top can add a lot of value here. Rackspace on the other hand is in the middle of a pretty cut-throat market segment, with lots of competitors and a large need to keep up with them feature wise. You absolutely need a visionary / this is what our market will look like in 3 years person running the show here. Rackspace could have filled a need between Digital Ocean and AWS, but I don't think they ever saw it that way....
throwaway5752 4y ago
Regarding Boeing, every person, and particularly every engineer, should read https://www.amazon.com/Flying-Blind-Tragedy-Fall-Boeing/dp/0385546491 https://www.amazon.com/Flying-Blind-Tragedy-Fall-Boeing/dp/0...
callalex 4y ago
How much of that can be attributed to Bastien being better at begging for bailouts and subsidies, as opposed to actually improving the company?

CamperBob2 4y ago

The decisionmaking behind those deadly products happened long before the CEO in question came on board.

rocqua 4y ago

Reportedly at Boeing the culture at the executive level remains 'bean-counter focussed'. Does the opposite hold for Delta Airlines? It seems to me like the disposition of the CEO matters a lot more than their formal background. If an engineer rose through the ranks by siding with the MBA/accountants/bean-counting-culture in a company, he is likely to run it in the (presumably correctly maligned) bean-counting ways. Whereas an accountant who understands the bean-counters but has seen the pitfalls of that kind of management could easily decide not to manage like a bean-counter.

fnordpiglet 4y ago
I think it’s also a canard that the CEO is in charge. They’re responsible, but often the CFO or COO are in charge, or some rule class culture of middle management. My understanding from engineers at Boeing it has not had engineers in charge for a long time and it’s entirely run by accountants and business development.
robszumski 4y ago
One cool fact is that prior to running Red Hat, Jim Whitehurst was COO of Delta Airlines. He could absolutely talk the talk on open source software. I always thought that was cool.

dralley 4y ago

"When people say I changed the culture of Boeing, that was the intent, so that it’s run like a business rather than a great engineering firm. It is a great engineering firm, but people invest in a company because they want to make money." - Harry Stonecipher, Boeing executive and CEO until 2005 https://www.chicagotribune.com/chi-0402290256feb29-story.html https://www.chicagotribune.com/chi-0402290256feb29-story.htm...

AceyMan 4y ago

iirc, Ed is a career DAL employee who bootstrapped to the CEO position, so while he's not an ops guy, per se, he still "gets" Delta and what makes it the company it is. That's a trait I suspect you'll find makes in every successful chief executive, irrespective of the industry.

fnordpiglet 4y ago

Any sufficiently broad generalization is always wrong.

antihero 4y ago

> Boeing sold deadly products under leadership by their engineer CEO. I remember hearing I think in a documentary that the merger with McDonall-Douglas made it have a more business-y culture that lead the the terrible failures.

wahern 4y ago
McDonnell-Douglas is often blamed for changing the Boeing culture, but it was the Boeing CEO Philip Condit who led the deal, and more importantly helped engineer the cultural takeover by strategically placing McDonnell-Douglas executives in key positions. Condit was at one point a lead engineer at Boeing, but was deliberately chosen by the Boeing board (at least the majority faction) precisely because they knew what he wanted to do with the company. The person who pushed back the hardest against the McDonnell-Douglas merger was the Boeing CFO Boyd Givan. He was quickly ousted not long after the deal was finalized, accused of being too financially conservative compared to McDonnell-Douglas' M.O.: https://archive.seattletimes.com/archive/?date=19980715&slug=2761320 https://archive.seattletimes.com/archive/?date=19980715&slug... The blame ultimately rests with the Boeing board. There was a minority faction on the board that fought tooth-and-nail. They couldn't stop it, but IIRC their concession (to prevent the minority from creating a ruckus in public) was being able to keep Givan as CFO after the merger. But Condit ensured that that didn't last long by undermining Givan at every turn, which was probably the plan of the majority board faction all along. Based on this and a few other anecdotes, and if we're making wild speculations, I'd say that whether a CFO makes a good CEO depends on the type of CFO. There's the traditional CFO--the "bean counter"--whose job is to manage the money and keep a low profile so the rest of the company can do their thing. Then there are the new generations of CFO, which started coming up the ranks in the 1970s and 1980s (see, e.g., McDonnell-Douglas), who see creative accounting (aka financial engineering) as a legitimate way to boost stockholder value and an end in itself, independent of a company's core competency. If a company has good bones, a traditional CFO can make a great steward at the very least. For the new type of CFO, they often couldn't care less about a company's core competency, and are more speculator than bean counter, at least in the traditional meanings of those terms.

Retric 4y ago

Find accountants are actually much better at C* positions than MBA’s. It seems like there should be a lot of overlap, but I think accountants have a better grasp of the underlying business reality. Or at lest the idea that you can’t get something for nothing so saving money on X likely costs you elsewhere.

dv_dt 4y ago

The Boeing engineer CEO who replaced the accountant CEO (one of the first in Boeing history) under which most of the preliminary design of the deadly product was performed.

mattcantstop 4y ago

A company named Apple seems to be doing well with the logistics guy at the helm as well.

wwweston 4y ago
They're making money, that's for certain. They're not making new product categories and markets like they used to, though, just iterations on things they were already doing well enough (and sometimes those iterations take away more than give). Their established capital and position in the market are their strength more than any other particular vision or talent on display. That's enough to keep them strong for a long time on logistics. Not sure what happens if they face a well-funded vision challenger.

mandevil 4y ago

The most important bad decisions in the Boeing case were made in 2011-13, when they promised that the 737 Max would not require a new type certificate for someone with a 737 cert already, and that it would use the new, larger, and more efficient engines. At that point in time, the CEO of Boeing was James McNerney, who had a Harvard MBA, worked at P&G and McKinsey, then spent 20 years at GE (running their airplane engine business). When he lost the race to succeed Jack Welsh he went to 3M and then was picked to run Boeing. At the time that these key bad decisions were made for the 737 Max, Dennis Muilenberg- the engineer you cite- was running the Boeing Integrated Defense side of the house and had no authority on the 737 Max. He does bear some responsibility for the Max- he was CEO when it first flew, got certified, was delivered to customers, and the first crash that was not investigated with appropriate speed- but the most important bad decision was made when a MBA was running the company. International airliners and semiconductors are two areas where I've become convinced that engineering CEO's are required, because they both involve making 10 billion or more dollar investments that won't even enter the market for more than 5 years. So you need someone with a very good feel for technological possibility, one who understands that you can't bafflegab mother nature the way that Harvard's MBA school teaches you to. It's possible I'm over-indexing on Boeing and Intel: Airbus' big recent fiasco- though since it didn't kill anyone it's not nearly as big as the 737 Max- the A380, was largely a commercial failure not an engineering one (by some estimates the A380 never even turned a profit on fly-away costs, totally ignoring development costs). So maybe having Harvard MBA's and market people would have saved them. On the other hand, when those key decisions were made (2000 was when the A3XX was approved) Airbus had a convoluted two CEO-two Chairman structure designed (to this American's jaded eye) to prevent any personal responsibility from leaching back to the bosses, so I can't tell you who was in charge when the wrong decisions were made for that program.

mox1 4y ago

The airline industry is more or less an oligopoly and perhaps even a commodity service, so growing market share kinda means not sucking. The basic experience of an airplane (getting from point A to point B quickly) hasn't changed much. I can see how a MBA / spreadsheet type at the top can add a lot of value here. Rackspace on the other hand is in the middle of a pretty cut-throat market segment, with lots of competitors and a large need to keep up with them feature wise. You absolutely need a visionary / this is what our market will look like in 3 years person running the show here. Rackspace could have filled a need between Digital Ocean and AWS, but I don't think they ever saw it that way....

throwaway5752 4y ago

Regarding Boeing, every person, and particularly every engineer, should read https://www.amazon.com/Flying-Blind-Tragedy-Fall-Boeing/dp/0385546491 https://www.amazon.com/Flying-Blind-Tragedy-Fall-Boeing/dp/0...

callalex 4y ago

How much of that can be attributed to Bastien being better at begging for bailouts and subsidies, as opposed to actually improving the company?