The Boeing brand is taking a beating in the aftermath of two fatal 737 MAX crashes in less than five months. The aerospace giant is confronting a withering backlash from regulators, politicians and investors, as well as airline executives and consumers.
Some of that backlash was inevitable, given both the magnitude of the tragedies — 346 lives lost — and the troubling details that have emerged since the crashes. Among other things, Boeing stands accused of rushing the certification process of the MAX, charging extra for certain safety options and trying to delay the FAA grounding of the aircraft with a personal call by CEO Dennis Muilenburg to President Trump.
But experts say Boeing has made a bad story far worse by a crisis-management strategy that seemed to emphasize legal positioning and blame-shifting rather than the lives of the victims and the concerns of future passengers.
That attitude was on display within hours of the Oct. 29 crash of Lion Air, when Boeing’s initial response was “to point the finger at the pilots and to deny even the possibility that there was anything wrong with the airplane,” said Scott Hamilton, a Seattle-area industry analyst and publisher of Leeham News and Analysis. “That was incredibly bad form, and they got a lot of blow back from that.”
Certainly, Boeing’ s strategy is at least in part a reflection of the legal and regulatory realities of modern aviation. In the aftermath of a fatal crash, “everything you say is going to be used in a lawsuit somewhere,” said Richard Aboulafia, a veteran aviation analyst with the Teal Group.
“On top of that, everything you say that mitigates the blame associated with a technology or a product is going to be seen as a potential slight against a customer,” he said.
Boeing’s public statements are also sharply constrained by rules governing crash investigations, which can lead to penalties for comments or actions by manufacturers that might be seen as prejudicial to the investigation. Hamilton notes that when Boeing executives traveled to Japan to apologize for the 787 Dreamliner battery fires in 2013, the company nearly lost its consulting role in the National Transportation Safety Board investigation of those incidents.
Yet even with such challenges, many of Boeing’s image wounds are self-inflicted, aviation observers and industry officials argue.
By many accounts, Boeing’s public-relations operation has been bureaucratic and slow during the crisis, often taking hours or days to issue statements or respond to reporters. Indeed, some industry insiders say the company has behaved as if it were unprepared for the intensity of the media response to both the crashes and to the company’s own clumsy response.
“When we first started talking to them right after Ethiopia [they] just couldn’t get their heads around what was coming on the PR side — they were MIA,” said an executive at an airline that is a Boeing customer and who spoke on condition of anonymity to avoid damaging their relationship.
The result, experts say, is a company that has seemed overwhelmed by a social-media-driven news cycle that is measured not in days or even hours but in minutes.
Boeing “has been a step behind the news cycle on the crisis from the beginning,” said Lawrence Parnell, a former public-relations executive who now runs the Strategic Public Relations graduate program at George Washington University. “They are reacting to developments as they occur, and not necessarily having any kind of a leadership role in the unfolding of the crisis.”
Boeing is hardly the first company to fall behind the curve in a crisis. Parnell notes that most firms’ response to trouble is slow and often defensive. Indeed, according to communication theorist William Benoit, “denial” and “evading responsibility” are the two stages nearly all organizations in crisis go through on their way to developing a more effective response.
But experts say that, even taking into account the complexities of modern commercial aviation, Boeing has struggled to move beyond the defensive and evasive stage as quickly as it might have.
One possible factor, experts say, is a corporate culture dominated not only by lawyers but by engineers and deal makers. The engineers build the planes, and the deal makers sell them.
And, importantly, because Boeing has always been a “business to business” company — it sells commercial jets not to consumers, but to airlines and or leasing companies — Boeing never had to develop a large in-house expertise in responding to fast-moving consumer sentiment.
In the past, Boeing has been successful in coping with crises — including fatal crashes — with a mix of hardball legal strategy, solid engineering and personal lobbying to keep its big customers happy and its government regulators at bay.
A case in point was the 2013 crisis over overheating batteries in the new 787 Dreamliner, which led to a three-month grounding. Led by Mike Sinnett, then vice president of engineering, Boeing identified the problem, developed a solution, and rolled it out across the fleet with impressive speed. That engineer-led response averted what was shaping up to be a multibillion-dollar disaster for the company, and has become the gold standard of crisis management in commercial aviation.
The MAX crisis, by contrast, presented Boeing with a more complex problem potentially combining flawed technology and human error, compounded by hundreds of deaths.
But the challenge was intensified, experts say, because the barriers between Boeing’s business-to-business model and the consumer marketplace have been shattered by social media and digital tools that not only spread news at the speed of light but also allow consumers to respond to that news almost as quickly.
For example, the booking app Kayak has added a feature that will let consumers filter out any MAX flights once the plane is no longer grounded.
Boeing’s “business just got a lot more complicated and it’s got a lot more layers to it,” said the airline executive. “The customer isn’t just the airline operator. It’s everybody who is touching that airplane — and that includes the customers sitting on it.”
In such a fast-paced, consumer-driven business environment, Boeing’s hypercautious, attorney-vetted response has struggled. Boeing, said Parnell, is “moving at a pace that is consistent with baby boomer leadership, in a crisis that is moving at millennial speed.”
There are signs that Boeing understands its predicament. The company is getting help from New York-based crisis consultant Sard Verbinnen, according to The New York Times. It has also softened its language somewhat.
Although Muilenburg was virtually silent for a week after the March 10 Ethiopian Airlines crash, when he did issue a statement March 18, the language was clearly intended to counter the company’s previous coolness. “Our hearts are heavy, and we continue to extend our deepest sympathies to the loved ones of the passengers and crew on board,” the statement read.
And at a news conference Wednesday at Boeing’s airline-customer facility in Renton, the company had Sinnett, the force behind the successful Dreamliner response, detail the company’s progress in developing a fix for the suspect flight-control system known as the Maneuvering Characteristics Augmentation System, or MCAS.
But even then, reporters covering the presentation were not allowed to quote Boeing officials by name during a question-and-answer session after the presentation.
The long-term consequences of the crashes and Boeing’s response will depend on the effectiveness of Boeing’s software fix — how well it works, and how quickly and smoothly it can be deployed.
But it may also depend on the lessons Boeing itself takes from the episode — and whether a company run by engineers and attorneys can learn to navigate a business in which consumers may suddenly care as much about the type of aircraft they’re flying as they do about the price of the ticket.
“They’re going to ask,” the airline executive said. “They’re probably going to ask for a long time, ‘Am I on a MAX?'”
Most Read Business Stories
- Downtown Seattle's troubles go beyond the pandemic
- Zillow pauses homebuying as tech-powered flipping hits snag
- Microsoft leaders warned Bill Gates over ‘inappropriate’ emails
- Former Boeing pilot indicted on fraud charges related to 737 MAX crashes that killed 346
- Oregon company's iron battery breakthrough could eat lithium's lunch