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"the lengths to which they went to ensure all prior institutional knowledge regarding how to properly build a plane was systematically destroyed." why do this

• Tagbert 3y ago
  Perhaps because the senior people were at a higher pay grade? If you bump off the expensive employees, your overhead goes down. Better numbers next quarter so you get a bonus.
  • alistairSH 3y ago
    It's in the article. Not just senior = higher pay. Senior = more likely to stick to existing (known good) safety/QC processes. Boeing didn't want QC at all - they wanted the guys assembling the planes to do their own QC (which is likely illegal per FAA regulations). Toss in a side of union busting. And a dessert serving of outsourcing to the lowest bidder, regardless of that bidders history in the space.
  • labster 3y ago
    Senior people also cost more because their health care costs more. Of course discriminating against older people is illegal, so they cut down on senior staff which just happens to have the same cost reduction. Funny that.
• hwbunny 3y ago
  That's the million dollar question. Why talented people are forced out? Like managers/other key members have a mission and if you somehow not fit in their "world view", you get hell.
• kwhitefoot 3y ago
  It's a side effect of reducing the power of those awkward people who want to spend money on well designed aeroplanes.
• Cheer2171 3y ago
  The intention wasn't to destroy institutional knowledge. The intention was to cut costs in the short term, largely through outsourcing and turnover. Why pay a senior engineer a huge salary when you could replace them with a consultant in their twenties? They just didn't think or care about the consequences.
  • margalabargala 3y ago
    They adopted a philosophy of management that explicitly assigned no value to institutional knowledge, and thus eliminated anyone who had it as they were not considered worth their salary. From the article: > Boeing had come under the spell of a seductive new theory of “knowledge” that essentially reduced the whole concept to a combination of intellectual property, trade secrets, and data, discarding “thought” and “understanding” and “complex reasoning” possessed by a skilled and experienced workforce as essentially not worth the increased health care costs.
    • swader999 3y ago
      This is true, they also cut costs by 'finding' less defects in QA, deferring them to production deployment several quarters out.
      • bumby 3y ago
        This is the irony of good QA. 1) Company starts to notice a lot of quality problems. 2) Company institutes a good QA program. 3) Company notices less quality problems. 4) Company cuts QA program because there seems to be less need for it. Wash. Rinse. Repeat. (The same can be said for safety when dealing with low probability events).
        • FrustratedMonky 3y ago
          Yes. It is raining. I use an Umbrella. Still raining, but I am no longer getting wet. I must not need the umbrella. Close the Umbrella Get wet again.
• djbusby 3y ago
  Those old engineers cost too much! And we already know how to build planes. So, we can ditch them, my quarterly KPIs look good and with the money freed up from pushing them out it can land in my bonus check!
  • pseingatl 3y ago
    Or 20 billion in stock buy-backs, juicing the price.
• margalabargala 3y ago
  Stock price gains. Fire all the longest-tenured, highest-salaried employees. Now you have a company that appears to look similar but with millions of dollars fewer per year in headcount expenses. Boeing's stock price went up 10x in the time frame covered by the article. The people responsible for gutting the company have cashed out.
  • Rinzler89 3y ago
    >Boeing's stock price went up 10x in the time frame covered by the article. The people responsible for gutting the company have cashed out. Why does the stock market reward idiot shit like this? I've seen the same whit a a large US semiconductor company. In the 2008 crunch, the fired the most tenured employees and offshored the work abroad. Granted, the company didn't fail, their stock went up and now it's 5-7x that amount.
    • HumblyTossed 3y ago
      Because the market is barely better than a ponzi scheme. There's ___just___ enough laws around it to keep people somewhat okay with it.
      • JackFr 3y ago
        That’s nonsense. Markets are the best way we’ve come up with to allocate capital. Committees and commissars do not do a better job.
        • Eisenstein 3y ago
          > Markets are the best way we’ve come up with to allocate capital. Properly regulated, competitive markets. Aerospace regulation is based on a lot of trust, which Boeing seems to have exploited, causing this problem. The market is not competitive; there are only two players and the output of only one of them cannot meet demand. > Committees and commissars do not do a better job. Dichotomies are good for making punctual arguments online, but you do yourself a huge disservice by using them to frame the options in your own mind. Do you honestly think that the options are 1. Antisocial free market allowed to do whatever it wants for capital gain, or 2. Despotic communism? You are smarter than that.
• forgotmyinfo 3y ago
  Y'all're gonna hate this, but financialization and the relentless pursuit of profits. Every time this stuff happens, people ask why, and it's because of greed. When you focus on making money above all else, this is what happens. It's not a mystery.
  • trilobyte 3y ago
    This is where regulation steps in. A regulatory body should make the cost of certain failure scenarios so painful that companies are incentivized to make better choices. We probably don't need regulations about the color choices of t-shirts, but safety & testing for mass-transit vehicles might be warranted.
    • jandrese 3y ago
      That's the future guy's problem. So long as it is possible to cash out before the consequences happen that sort of regulation won't move the needle much. Making it illegal to be a bad CEO is one of those things that sounds intriguing on paper, but would be a nightmare to implement in real life. Prosecutor: "You inflated investor returns by sabotaging the future survival of the company and made shoddy products that killed people." Former CEO: "So what?" The worst part is that this is a real problem. So many formerly strong companies have been brought down by this behavior that it is becoming notable when it doesn't happen. We are allowing these guys to destroy the American economy slowly just because it makes them and their close buddies ridiculous money. And of course the government is largely captured by these same people, so Washington isn't going to help. Just so frustrating.
      • rybosworld 3y ago
        This phenomenon also explains some others that may or may not be surprising: 1. Founder led companies have higher returns. And it's by A LOT. Hard to quantify exactly but, I've seen quoted numbers as high as 20% outperformance for founder led companies. 2. The biggest corporations never remain the biggest. Where is the Dutch East India company today? More recent examples: IBM was overtaken by Nippon Telephone, was overtaken by Exxon Mobil, was overtaken by GE, was overtaken by Microsoft etc. 3. It's not very common that a company stays in the S&P 500 for more than 30 years. The average lifespan is 21 years. The common thread is that as soon as the sociopath MBA's take over, they Boeing the whole business.
• autokad 3y ago
  a lot of people say things like 'stock price', but that's missing the point. the lesson is in the nuance. its many factors, effecting all aspects of our lives now honestly. - young people's disregard for the knowledge of people older than them. This can be an essay in itself, but there's the idea that the reasons why people are doing things the way they are is because they are stupid, something like: "you are young and you knows how to do everything right if only these dumb old people would get out of my way." I had a friend do a start up to make bourbon in 3 months. He thought all those alcohol producers that take 5-30 years making them were doing it wrong. I am like, definitely give it a go but understand that "I am sure they thought about this'. - management focuses on nonsensical metrics. In recent history, you have to be data driven, focus on metrics, ignore everything else, its the new religion. An example is how technical support teams focus on having 0 tickets open, so support engineers just close tickets even if the customer isn't helped. but hey, that red line is pointing down and to the left right? win! And as with boeing, they made their metrics look really good, look, no more defects! all you have to do is stop reporting them. - companies willing to outsource critical components of their business. I never understood this one, I don't care how 'cheap' it is, you don't outsource critical parts of your business. at best, they don't have the same stakes as you do on the matter, at worst they steal your IP and/or become your competitors.
  • tomthehero 3y ago
    Don't blame this on young people, it's probably mostly post-40 dudes who run the board of these large companies
    • autokad 3y ago
      young dudes of the time, that are now hitting their 40s. Dont get me wrong, the new young are doubling down on that world view.
  • samatman 3y ago
    > I had a friend do a start up to make bourbon in 3 months. He thought all those alcohol producers that take 5-30 years making them were doing it wrong. I am like, definitely give it a go but understand that "I am sure they thought about this'. I realize this is focusing on the example, but no, established bourbon distillers aren't going to stop barrel aging. It's part of the brand, it's part of what people pay for, and they have no reason to. Your friend might have been overconfident, I don't know, but macerating oak chips at high temperature, getting the process right, adding flavorants: if he succeeds in making a high-quality product, great! Am I skeptical? Yes. But again, the established distillers didn't consider and reject the idea of making liquor this way because it's a bad idea, they wouldn't do it because that's not bourbon. If he's successful, they still won't do it, because it's not bourbon. He can sell to people who don't care, though. If it's good, I'd get a bottle.
• tanseydavid 3y ago
  >> why do this intentionally? Myopia + greed is a hell of a drug.
• vpribish 3y ago
  they did not. this article and many people are sensationalizing it to get attention and push whatever their angle is. it was short-sighted, stupid, greedy, and wrong, but not intentionally suicidal (let alone homicidal!).
• pyrale 3y ago
  Some people in organizations can't take no for an answer. They want to see their orders followed, and if they see you as a roadblock, you will be marginalized, sometimes with harm. That's not always bad, sometimes employees drag their feet when they shouldn't. But in some situations (for instance, one arm of the company gaining the upper hand), the people in power are so convinced that their own perspective and goals are right, that they think they don't need to listen or understand the big picture. Ad to this that sometimes an exec has sociopathic tendencies, and you have an explosive cocktail of harassment and destruction of valuable knowledge. The more resilient the company, the more entrenched this behaviour can get, and the more irreversible it will become.
• FrustratedMonky 3y ago
  "intentionally" is too strong a word here. More -> intentionally cut cost by eliminating experienced people. Not -> intentionally getting rid of knowledge. even the worst managers wouldn't admit to wanting to loose knowledge.
• bsder 3y ago
  Are any of the executives who did this in jail? No? Well, carry on, then. None of the executives responsible for this have paid any price. None of the investors or board members who allowed this paid any price. And the worst part: it's not clear you can fix it, now. Even if you completely busted out every executive and wiped out the investors, there is no path forward since those executives pushed out all the engineering knowledge.
• zero_shift 3y ago
  It's a lot easier to make your outsourcing strategy stick, if you no longer have an alternative.
• Brian_K_White 3y ago
  Most of the article is spent describing exactly why.
• tremon 3y ago
  Because the value of expertise does not readily show on balance sheets. Boeing had been systematically eroding expertise for 25 years before its planes started to fall out of the sky.