From what I understand, a big part of what’s happening with Boeing, is that Boeing is run by Business person who want to maximize return of stock-owner rather than by people wanting to make a good product. The gained flexibility/nicer budget from massive sub-contracting led to “loss of knowledge”, and cutting-down quality control steps which “never catch anything” led to issue being missed-out.
Do you think that MBA program will take this reality into account ? or would they keep focusing on maximizing short-term profit even if it jeopardize the company’s future ?
This is a good time to remember that as a species, we optimize towards a balance between least effort and highest reward probability and not “objective best”.
You’ve got the wrong idea about what the shareholders prioritize. They got sued by the shareholders for lying about being committed to safety and instead maximizing short term profits.
https://www.reuters.com/legal/boeing-is-sued-by-shareholders-following-max-9-blowout-2024-01-31/
Shareholders seek to maximize profits. If that includes a lawsuit to squeeze out even more investments, then why not?
They never bothered to check if Boeing did what they had to do security wise. Only once it threatened their profits they sprang into action.
Exactly how are you supposed to check that a company you own shares in does what it’s supposed to? You’re not allowed into the factory. You’re not allowed to see any reports other than what they already publish.
You have to take the word of the management.
This wasn’t a bug, it’s a feature of capitalism.
I’m a recent MBA grad and I can attest that stuff like this was an important part of the curriculum re: sustainable growth. Cutting corners, focusing on short term profits is always a dead end. When leaders get lazy and don’t drive a culture that is aligned with the company’s mission, values, and obligations, decay is inevitable. The Boeing board of directors is as complicit in all of this as their executives are.
I don’t necessarily believe you have to have deep expertise in a given field to govern a business in said field. Often it’s even an advantage to come in with a fresh set of eyes. But you need to at least RESPECT that field and its experts and be forthright about taking responsibility when you take action intended to eliminate waste. If the only metric you are using is revenue, or operating profit, or whatever, you are creating an organization that is incentivized to maximize those at the expense of other, core-business-critical factors. If you’re making something inconsequential, by all means take those risks and race to the bottom. But when people’s lives are at stake, you need to have reverence for what your business actually does.
You can’t educate your way out of the logic of capitalism. These folks are optimizing return on investment, not human utility. The system is working as intended, why would they change it?
