The continuing crisis that led to this week’s high-level housecleaning at Boeing is yet another example of a corporate board choosing a chief executive officer who knows more about cost-cutting than he does about a company’s core business.of Boeing CEO Dave Calhoun was applauded by the company’s shareholders and others, the underlying question remains: What did directors expect? Mr. Calhoun is a money guy, an accountant by education and training, not an engineer or aviation design expert.
While there is plenty of blame being meted out – the head of Boeing’s commercial airplanes unit is out, and its board chair, Larry Kellner, will not stand for re-election – all directors should get a heaping helping. When the executive leadership a board chooses is focused more on the numbers than on how a company’s products work – or don’t work – bad things can happen. In Boeing’s case, those bad things are matters of life and death.
Mr. Chapek’s fatal flaw: He didn’t understand the creative culture that is the core business behind Disney’s entertainment products. Remarkably, Mr. Calhoun was brought in by Boeing’s board to be the company’s saviour at a time when its products were failing and trust in the Boeing brand was thinning.
Exacerbating the problem was the fact that Boeing had fallen into the soft but deadly trap of a duopoly. With only one global competitor, Airbus, the board clearly supported a strategy of cutting costs without fear of jeopardizing sales – until, of course, their planes started falling apart.