New Leader Sets Boeing’s Focus

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James McNerney took over as CEO of Boeing a little more than a year ago. But you haven’t heard much about him for the last year. That might lead you to think he’s not been busy.

But he’s been doing what any good deciple of Jack Welch would do when taking over a company — “deep dives”, taking a long hard look way down in the organization to see what he inheritted. I’m sure it was an eye-opener.

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Jim McNerney

Boeing has taken a lot of hits for a long time, not just in the recent ethics scandals. In Seattle, Boeing has been ridiculed as the epitomy of bloated big business. One nickname from the late 20th century was “the lazy B”. Around here, you can pick out the Boeing employees just like the Microsoft ones. They are stereotypical nerds all, differing largely only by the generation.

The tens of thousands of proud Boeing plane builders are local fixtures, and their relationship with company management has been rocky since the beginning. Not aided by a argumentative union (see my post on that here), the ebb and flow of the company’s fortunes take the larger local economy with it. This effect has been lessened, but by no means removed, by the additional of software and biotech to the local scene.

Boeing’s relationship wtih Seattle hit a big low, when the former CEO Phil Condit made the rather absurd move to take it’s headquarters to Chicago. This choice was ridiculous because the company had essentially no business operations nearby (and was shuttering those it did have).

In an amazing show of hubris, Condit held a public contest to see which city would give the most largesse to Boeing for moving their headquarters there. In an over-hyped press event, the company selected Chicago while on board a Boeing jet headed for… may I have the envelope, please… Chicago! It was a ridiculous spectacle, it moved less than 0.1% of the employees there, and (rumor has it) was only done because Condit and his wife wanted better restaurants and night life. The reasoning was to put them in the middle of their customers, within a short flight to them all. But, in point of fact, their largest growth market for the company is the Pacific Rim, and Seattle is far closer to those customers. Yet another reason why Condit is long gone.

All of this makes McNerney’s challenge even more important especially to those around here. He needs to restore a sense of sanity in a company that seems to lost its way much like Enron, Worldcom, and the other famous debacles of the end of the last Century.

His biggest challenge is to focus on something… anything

His biggest challenge may well be finding a a way to get this behemoth, famous for everything from commercial aircraft, huge government contracts, and questionable ethics, to focus on something… anything. The company appears to be involved in all manner of large military and aerospace projects and master of none. As I have said repeatedly, focus on some vision, any vision, is important. McNerney seems to agree.

With recent wins in the big plane arena, whether because Airbus is stepping on its own tail or not, McNerney has a great chance to celebrate some successes, and move toward the future. Their new “Dreamliner”, the 787, looks to be a hit — just what the company needs right now. If they can actually ship the thing (friends inside tell me this will be no small accomplishment) they stand to regain their crown as the world’s planemaker.

This gives Jim McNerney one great leg upon which to rebuild the company, and I wish him the best of luck. Not only because my own selfish interests wish well for Seattle, or because Boeing is the strongest exporter fighting in our national balance of trade war. Mostly I wish them well because the whole country needs to see a large company that clearly lost its way in the last century regain it in this new one.