Inside Out Culture

What went wrong at Boeing? A deeper look at whistleblowing and safety culture

• Inside Out Culture • Season 1 • Episode 8

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Boeing’s purpose is ‘To protect, connect and explore our world and beyond.’ Yet in 2018 and 2019 the 737-MAX airliner was grounded around the world after two crashes killed almost 350 people in Ethiopia and Indonesia. Whilst in 2023, two incidents have left passengers injured and a Boeing whistleblower committed suicide. All of which has led to the resignation of CEO Dave Calhoun.

Boeing’s culture has some way to go before shareholders and passengers alike can regain confidence in their safety record.

On this episode of the Inside Out Culture podcast we look at the role that culture had to play in events so far, and what safety culture change is going to be required if Boeing is to recover? We also talk about psychological safety and look at the role of whistleblowers and how they can help to surface issues that may otherwise remain unseen by senior managers.

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Colin:

Welcome to the Inside Out Culture Podcast, where we look at insides of working culture and provide ideas, insights and actions for you to take on the outside. I'm Colin Ellis and I'm Cath.

Cath:

Bishop, and in each episode we'll examine a different question or a different organization, and we'll use case studies, research and our own insights and experiences to help you change the way things get done in your world.

Colin:

We hope you enjoyed today's episode. Please like, subscribe and, of course, let us know what you think.

Colin:

Hello everybody welcome to another episode of the Inside Out Culture Podcast. I'm Colin Ellis.

Cath:

And I'm Cath Bishop, and today we're going to be looking at the case of Boeing and thinking about what's gone wrong in their culture, with a view to look under the surface of what it means to have a real safety culture and to think about the role of whistleblowing within that. But before we start delving into those real details around the culture that enables some of the crises that have happened at Boeing, give us a bit of a scene, cesar Collin, about Boeing and recent challenges that they've faced.

Colin:

I always think, with things like transportation, it's not something that we want to overly think about, Cath, particularly airline security, where we're just getting onto planes, we don't want to think about it. But, of course, as soon as something happens on an airline, it's immediate cause for concern, and this was a case in 2018. And then 2019, when two Boeing relatively new planes, the 737 MAX, went down in Indonesia and Ethiopia with a loss of almost 350 lives. Now, at the time, the Boeing executive didn't really know what was wrong and so they didn't really respond in the way that we would expect, and it was really down to countries to actually ground the 737 MAX plane. So there wasn't really a response from Boeing other than the usual, you know, going through the motions in terms of making sure that things were investigated properly. But country actual country started to, I suppose, become fearful of what could happen for other planes and they started to ground them, and then the FAA grounded all 737 MAX planes. So this investigation was ongoing. In response, boeing fired the top executive of its commercial airlines division. That was Kevin McAllister. They also eventually fired Dennis Muhlenberg, who was the chief executive, and they installed Dave Calhoun as the CEO. He was a bit of a Boeing veteran. He'd been there a number of years and we'll come back to Dave Calhoun shortly Now.

Colin:

When the investigation into the accident was finally completed in 2020, it found just like a litany of areas. I read the report just so many things. It would take 30 minutes just to describe all of the things that they found. But essentially not only were the mechanical things, there were specific things within the culture of Boeing itself which then contributed to kind of an undermining of its production and its quality processes. And then it all seemed to go quiet for a couple of years. You know Boeing was recovering nicely from COVID and the crisis they hit the airline industry. And then in January 2024, the plane was back in the news when a door fell off an Alaskan plane just after it had taken off from Portland. No one was injured, thankfully, because it just happened just as it had taken off and they managed to land the plane.

Colin:

And then on March 12th of this year, a Boeing whistleblower, a guy called John Barnett, really courageous guy who had shone a light on Boeing's not only its culture and its safety practices, and he was determined. He was one of these people who was determined to change the culture at Boeing. Unfortunately, he was found dead in his truck by a suspected suicide and at the time he told the BBC I went and read his interview with the BBC that, under pressure, workers had been deliberately fitting substandard parts to aircrafts on the production line. He even said that parts that had to be removed from scrap bins and fitted to planes because the pressure to keep production up was so high. And he said I raised all of these issues to managers, he said, but nothing was ever done.

Colin:

And in a, I suppose a tragically ironic twist, on the same day that he was found dead, a LATAM Airlines flight from Sydney to Auckland went into a steep dive when someone accidentally flicked a switch. Just a flick to switch, and this is LATAM Airlines flight 800, causing the plane to dive sharply and 50 people were injured. And just as we're recording this, you know we traded messages yesterday that we plan to record this podcast and just yesterday, which was March 25th, dave Calhoun, the CEO, resigned over questions over its safety record. Now coming back to Boeing's purpose. Boeing's purpose is to protect record. Now coming back to Boeing's purpose. Boeing's purpose is to protect, connect and explore our world belong and beyond. And I think all of that is now in question, based on its recent safety history.

Cath:

So it's quite a complex set of events, but there is a real. There are several themes running through these and there are quite a lot of decisions taken by leaders consistently over a period of time that have meant the underlying issues have not been addressed. Now there have been some very clear pressures on them that I think have enabled them to take that eye off safety culture. The thing about safety culture it's actually pretty simple. It has to be the top priority and if you at any point start to compromise that, then you are starting off a series of events that could end up exactly as they have for Boeing. But I think there are sort of three things that have really challenged them that they've managed poorly and, if you like, responded in a way driven by short-term gains. That is, that they have basically put safety. They compared it to getting their stock price right. They've looked at commercial imperatives to be more competitive.

Cath:

So we've got to change some things in order to be more competitive. They've had this greater competition from Airbus that's been pushing them along. That has meant they've gone right. How could we improve things short term? Let's start chipping away at actually some of the fundamentals around the safety culture.

Cath:

So they started to sort of see safety culture as something that could be changed in order to get your commercial gains, and that is a fundamental shift in your priorities.

Cath:

That means you're then really laying yourselves open to this sort of crisis down the line not immediately and of course, stock prices you get much more immediate returns, so you're driven to go. Well, if we do this, it'll help us in the short term, but fundamentally you've now you're no longer running a safety first culture and I think sort of the other pieces that the oversight system they had with the Federal Aviation Administration meant that they started cutting corners on some of the training so that they'd have a cheaper way of training, and when things were sort of shown that oh, actually this isn't responding very well, there are kind of issues now because we've got a bigger engine on board, they took shortcuts to fix it. That meant as soon as you get any kind of emergency situation now, yet you just don't have the contingencies and the backup to deal with it. So we see commercial pressures, we see the sort of competition in the marketplace and we see your oversight structures.

Colin:

Those are where you would get accountability and some checks and balances, all eating away at a safety first culture yeah, and I and I said to add to that cath, because I think you mentioned these these kind of commercial pressures for me it it really all ties back to the focus on business results. And you know Boeing, when I read about Boeing, their safety culture used to be absolutely exemplary, absolutely exemplary. And then they merged with McDonnell Douglas in the 90s and McDonnell Douglas at that time had this real, you know, kind of focus on profit, profit, profit and you kind of want both. And I still think and I'd be interested if you see this as well I still think there's a real focus on many organizations on making money. Now, don't get me wrong, I understand why that would be, but it's making money over building culture.

Colin:

I've read a really interesting statistic that Boeing actually spent more paying dividends than they actually did on research and development of their own planes, which is a way to win future business. You spend money on research and development only to ensure safety, not only employee safety, but customer safety. But actually this is how you get a competitive advantage over people like Airbus and really the airplane market now is Boeing or Airbus. And so, yeah, I mean I'm interested for you. Is this something that you see in your work. I definitely see it in mine. I work with one organization who spent more on photocopy paper. Remember, photocopiers are almost dead now because we've got the technology, we don't have to do it. They spent more on photocopy paper than they did on their culture. Is that something that you see?

Cath:

So we're back to that topic of metrics and incentives and human behavior, and I see that all the time. So you're right, they actually tied. When they combined with McDonnell Douglas, they actually started actually tying the director's rewards to the stock price and at one level you could say, okay, that's going to drive performance. But as soon as you do that, you need to go. What else could it drive? So a good thing might be a healthy interest in improving performance, but what else could it drive that we don't take safety culture so seriously, for example. So you need to, at that point, have something that's going to stop the downside of that incentive playing out. You've got to stop that somehow, or you've got to create another metric that balances that one.

Cath:

I mean, the sports world in a way offers us one of a kind of really easy analogy where you say it's all about the medal, and as soon as you say only the medal counts, then okay, well, that becomes a route into which we might start contemplating taking drugs or bullying athletes or cheating in some way way.

Cath:

Yeah, so we have to have that equal and opposite standard that says no, that doesn't count as winning a medal when you dope is not a medal, you'll be disqualified. That's not what we stand for and you see, sort of sport trying to actually get better at articulating that all the time and as we start to see some of the hidden costs. You know, it's a bit more obvious if athletes are doping, but some of the bullying, some of the abuse that has gone on in sports like gymnastics and many others, it's a bit more hidden and so actually we need higher standards of, you know, the ethics, behaviours that coaches and athletes and others exhibit in that sport. Yeah, that needs to be part of what we measure alongside the medal. So it's often that how piece Are we actually measuring? You know how we go about upholding a safety culture, or are we actually just measuring the stock price? You've got to sort of scaffold your metrics along the way to make sure that we're really understanding the behaviors that we're driving.

Colin:

And both are possible. Yes, you can have a really profitable organization. You really can. Some of the big tech companies are hugely profitable, but they also spend money on building a safe culture. We know a cast of sports teams that consistently win, but they do it in the right way.

Colin:

I was reading your book recently, when we talk about this process of winning and we'll definitely come back to this where it's about taking the time to build the foundations of future success, but there isn't this instant gratification and you mentioned that about the share price. But it is proven. It's proven that when you spend money to build a culture, it delivers on not only employee safety, but customer safety, production and, ultimately, financial performance. And there's still this misguided view that cutting spend on culture and cutting corners will actually save the money and increase the profits, when the opposite is true. And so I think at the heart of this is this concept of what's known as psychological safety, and I think we should spend some time just unpacking that and talking about that.

Colin:

This is something that Amy Edmondson has been talking about since the late 1990s, and it's really coming to the fore not before time, to be perfectly honest with you. You know, psychological safety is really about the kind of collective belief of how team members and managers respond or how they put themselves on the line. You know what's the response when they report something or raise a difficult issue, which is very much the case of Bowen, is what is that response? And psychological safety, like much in the team building world, is one of those things that still to this day, is downplayed a little bit. Oh, you know what do you mean safety?

Colin:

Oh, it's a very American thing to say. Or oh, yeah, all these emotions. Why do we need emotions in work? And yet we lose 260 million days a year Sorry, 260 million people every year suffer from mental health issues, according to the World Health Organization, which costs a trillion dollars in lost productivity. And yet I still don't feel that the concept of safety is that well understood For me. Cath, I don't know about you, but it still seems to be all about physical safety and lost time through injuries rather than psychological safety.

Cath:

Yeah, we always like to overemphasize the physical, don't we? Over the psychological, because it's a little bit easier to see, we're a little bit more comfortable. I've worked with construction companies who, very admirably, will start the day of a conference or any meeting with a safety moment, which is great because it's demonstrating safety comes first. But it is a physical safety moment and we check the room and make sure there aren't wires going to trip up or think about making sure we know where the fire exits are, but actually no one checks that people are feeling able to voice a question that they have, and that we've arranged the day so that it's not just the senior people who speak first. And you know, we're much less good at educating ourselves about that, understanding it, thinking about it, and so it's a word that I do hear used a lot, and yet I don't think we really have that depth of understanding. So actually you're right, amy Edmondson, a guru at the Harvard Business Review, is the person to go to to learn more about this. There are loads of videos. Her book, the Fearless Organization, which came out in 2019, encapsulates basically 20 years of her research that started in healthcare I was looking at because she used to research teams and in the process of learning about teams, she started to realize the most critical thing was psychological safety and that actually the medical teams that were exhibiting all the high-performing behaviors you'd expect in a team they seem to be the ones that also were logging most mistakes, and initially she had a crisis moment thinking, oh no, all these ones that are communicating clearly, you know, asking, challenging, they've logged more mistakes than the other ones where there doesn't seem to be any trust behaviors going on, until she, of course, realized that they're covering up the mistakes, whereas the more high performing team that was, you know, trusting and challenging and asking questions, were actually writing down those mistakes so they could be addressed. And so often healthcare is seen as one of the worst areas culturally for doing this, and we have a whole list of healthcare crises across the UK that demonstrate this, this and so she started in healthcare and now has worked in a lot of different organizations.

Cath:

She has a brilliant website, which I also recommend, we'll put it on the action sheet wwwfearlessorganizationcom, and there she talks about some of the behaviors that you can start to look for. So they also her company also offers like a behavioral metric. You can measure this stuff you can start to look and see within your team. Do people speak up and challenge within a meeting, what happens, what's the experience? Do people listen or do they sort of try and cover it up or be very defensive? So it helps you and you can easily find these online these questions around learning behaviours, psychological safety, what are the characteristics, and we need to tune into them. We need to then think a good meeting is not one where we get through the agenda and have some action points. A good meeting is where these behaviours are present and we can see them, and so for leaders to start setting goals around psychological safety, not just outcomes, all the time. So it's a huge area that is really important to kind of look at.

Cath:

There's another brilliant survey that was done, or big research experiment that was done in 2012 now by Google, and they wanted to see what is it that's most critical to a high performing team. It's called Project Aristotle. If you look it up, there are loads of articles and, of course, they looked across all of these techie teams looking at skills, looking at all sorts of different elements. The thing that was characteristic to their highest-performing teams was psychological safety. So we want people to get educated about this. There's so much information now. That should make it easier, but it means we have to shift to more behavioral metrics, to thinking about the experience that people are having, not just pure outcome metrics and numbers.

Colin:

Yeah, what organizations don't want is to appear in the media with staff talking about there's a culture of fear, which is exactly what happened to the Nursing and Midwifery Council this year. It happened at Sellafield Nuclear Power Plant in Cumbria in the UK Last year. This culture of fear happened and one of the things that organizations can do to really, I suppose, start to bring these issues to light is have some form of whistleblowing policy, an opportunity for staff to anonymously raise issues if they don't believe that they're able to do that in their normal line of work. And let's face it, you know, certainly for me as an employee, for 30 years I've worked in these unsafe environments we never used. When I started work in the mid-1980s, we never used to talk about psychological safety.

Colin:

But what I would say is you always knew when it wasn't there. It wasn't called that, but you always knew. When it wasn't there, you were afraid to talk to your boss. You couldn't raise issues. There was a finger-pointing policy. You couldn't raise issues, there was a finger pointing policy. I have this thing called worst organizations use blame throwers. People are just toss blame left, right and center, and so I think having some form of anonymous feedback process or a whistleblowing policy is crucially important because you want to be able to bring these things to light. What you don't want is people full of anxiety, full of stress, people who are potentially being bullied and harassed or worse, who see this kind of behavior and have no mechanism to actually raise it to management in a way that meaningful action will actually take place on it. And so I think you know for me that whistleblowing policy is crucially important to unearth some of these issues.

Cath:

I completely agree Whistleblowers are your friend. They are crucial to the health of your company, and so we really want listeners to think about actually what exists in your company. Often it's seen as an HR policy, as something that maybe we don't even know what it is, let alone understand what happens to anybody who actually becomes a whistleblower or who feeds into an internal hotline, whatever it might be, that your company organizes. So we really want people to sort of start understanding that. Think about what happens to whistleblowers. So we really want people to sort of start understanding that. Think about what happens to whistleblowers. You know what happened to John Barnett, the hostile response that had led him to have post-traumatic stress disorder, anxiety attacks, you know. And then the huge reputational, financial, existential cost now to Boeing of not having a really valid whistleblowing policy. So there are links that good whistleblowing culture, good processes that are taken seriously, are linked to business profits in anything other than the short term. But those who are acting are absolutely crucial and we've seen it.

Cath:

Whether it's Enron, vw, lehman Brothers, financial crisis, there are a lot of situations where whistleblowing is a factor that finally uncovers years and years of problems.

Cath:

We need to not have a goal that says we don't want any reports. So I've seen that as well and it's well-intentioned that a leader says a leadership team are saying so our aim is to have no internal reports, to have no whistleblowers. No, we don't want that as a goal, because otherwise you're incentivizing others to push those reports, to not admit to them, to make them go away in some way, and then we don't find out about the issues that they could be uncovering. So again, sometimes it's that misguided sense you know well-intentioned but poorly executed metrics without thinking what's the behavior we want? We actually want to make sure it is possible and perfectly accessible to whistleblow. We need to show that we respond to every report and this, again, it's not an HR issue, it's a leadership team issue. It's something that every chief executive is ultimately accountable for and there needs to be no retaliation for anyone who takes part. That is an absolute minimum.

Colin:

Yeah, one of the things that Netflix have worked hard on. And Netflix, you know, I've got to listen no culture in the world is perfect. No one has 100% engagement from all of this. I'm always worried when people say, oh, we have 100% engagement. I'm like, oh, do you? There's always somebody somewhere who's unhappy.

Colin:

But Netflix have worked really, really hard on removing barriers to feedback, and this is something that Reed Hastings talked about in his book. No Rules Rules, and I think the phrase is and forgive me if I'm misquoting this he says it's tantamount to being disloyal to the company if you fail to speak up when you disagree or you have feedback that could be helpful. But, of course, in order to be able to do that, there can't be any blame. That feedback has got to be welcomed. There's got to be things that you can do with it.

Colin:

In my book, detox your Culture, which is coming out soon, I talk about the fact that a lot of feedback reaches HR departments and then it doesn't go anywhere. Now, I don't want to betray what we're talking about here and make HR the scapegoat, but CEOs have got to give HR that responsibility to hold people to account, to really dig into what are the root causes and I think sometimes, you know, I spoke to a guy once and he said, oh, whistleblowers, isn't that just dobbing in on your mates? I was like, well, if those mates are bullying, harassing all these kinds of things, yeah, it is, and that's absolutely what we want. It is as Cath said. It's this really important role, but the feedback has got to go somewhere, it's got to be useful, and this is where boards of directors have also got to take an interest in this. One of the biggest issues with Boeing is that you know, there's been kind of 80% of turnover on the Boeing board since 2019. It's been like debt chairs on the Titanic.

Cath:

Right, gosh. You know that's really mad, isn't it Gosh? We are so in sync, colin, because you're referring to the no Rules Rules book by the CEO of Netflix and I have just finished reading Patti McCord's book Powerful building a culture of freedom and responsibility. I've even got it next to me, who was his sort of right hand woman and the head of HR, head of all people, whatever the name was. So, yeah, I've been reading about it as well, because they do some really disruptive things in order to think, actually, what are we incentivising here? They ask that question what are we going? You know, what are our policies? Do we need them? What sort of behaviour are they actually going to create? And go beyond the intentions to think about the impact.

Colin:

Yeah.

Cath:

Right, it's time to get to some practical takeaways from thinking about Boeing safety, culture and whistleblowing. So, as always, we're going to have an action, something for you to do, something for you to get curious about and something for you to uncover. So what's our action?

Colin:

Well, I think what we want people to do is to really know what your whistleblowing policy is. We finished on that there, Cath, but I think it's really important that people educate their teams, educate their colleagues, find out what it's like to be a whistleblower within your organization, what really happens. And then what really happens with the information that you provide information that you provide.

Cath:

Great and get curious. The question to think about is where could safety go wrong I think psychological as well as physical safety in your organization. Where are there some corners that maybe are being cut? Where could safety still go wrong? And that's then going to lead us?

Colin:

on to our uncover. Yeah, I think to uncover is you know where's the culture being compromised to hit business targets or deadlines. You're one of those organizations that's trying to do more with less. You know kind of what are you undermining within the way that you do things in order to hit something and potentially creating the kind of problems that we've seen for Boeing and other companies?

Cath:

Great. So our takeaways are make sure you go. Find out your whistleblowing policy. Read it. Educate others around you. Find out what actually happens in reality. Find someone who's used it, if possible. Get curious about where could safety go wrong in your organization and uncover where corners are being cut in order to hit some short-term business targets.

Colin:

Fantastic, great conversation, as Erica Looking forward to the next episode.

Cath:

Thanks, cheers, colin. Thanks for listening to today's Inside Out Culture.

Colin:

Podcast. Please remember to like, subscribe and, of course, share with others who you think may be interested.

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Cath Bishop

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Colin D Ellis

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