An engineering company should have engineers as managers from the bottom level all the way up to the CEO. Or at the very least, somebody who cares about product over profit.
Take a look at Apple’s functional organizational structure for an example of an engineering company done right.
If I were a betting person, my guess is they have created a culture of “schedule first”. Other orgs managed by engineers have been chastised for this in the past (looking at you, NASA). The problem is the risk/reward is asymmetrical managing these projects. Even though the severity can be extremely high, the probabilities of an error of this magnitude tend to be very small. This creates an incentive for ambitious souls to be aggressive and continually role the dice to meet schedule. As a former manager once told me when I was in a safety role, “you don’t want to get a reputation for slowing things down.”
To oversimplify things, say there’s a 1% chance any project can end in disaster. You can literally create an entire career ignoring that risk and still look like a star. Probability is on the individuals side. Meanwhile, the manager pushing to do things the right way to minimize that risk almost certainly will bear a higher cost/schedule burden. But in aggregate, that probability will catch up to the organization.
What makes me think this? There’s ample reporting Boeing didn’t follow their own procedures because they didn’t want to delay. Hazard analysis documentation wasn’t reflective of the design because the paperwork wasn’t getting updated. Their didn’t follow their own procedures regarding redundancy in design of items identified in the HA. I suspect they knew this was wrong which is why they obfuscated details in the investigation.
Culture matters, irrespective of academic degrees.
>With ethics now front and center, Condit was forced out and replaced with Stonecipher, who promptly affirmed: “When people say I changed the culture of Boeing, that was the intent, so that it’s run like a business rather than a great engineering firm.”
But I think it's worth noting to the (mostly software oriented) HN crowd - aerospace projects have massive manufacturing cycle times. Some things literally take years to manufacture for the proof-of-concept stage, let alone production. You can't NOT be incredibly schedule-oriented in this environment. This can cause some perverse incentives for management (which must be mitigated), but there are always going to be somewhat risky last-minute changes that could seem ill-advised in hindsight if you want to deliver something.
I generally agree strongly (e.g. car vs air safety). Though this group is highly cognizant of KNOWN risks. It's the UNKNOWN risks (usually found at those interfaces I mentioned above) that get overlooked. Unknown risks definitely will be more problematic in a compressed-schedule environment.
Required, not optional if the customer pays enough.
I dont understand much of redundancy of sensors, yet '3' would allow to ignore the 'bogus' reading.
The main new feature in a plane solving a problem that they knew was potentially dangerous which is why they had to install the auto-nose-down system in the first place.
How expensive could a couple of extra sensors even be compared to a whole plane?
Not knowing the angle of attack is miles better than not knowing that you don't know the angle of attack.
This would be fine if we're talking about carpeting on the flight deck, but the AOC sensor is a critical feature.
Here’s an interesting article about how engineers lost influence in Boeing: https://perell.com/essay/boeing-737-max/
Many here have misunderstood you,conflating the the stereotypical MBA type ( who is a essentially a con man) with an MBA degree. A 'mindset' of engineering BTW has to to be explained to the non-engineering personalities. Besides the obvious inclination for technical things, the next best trait is perhaps that of integrity. You really cannot put together a working great product unless there is there is a commitment at several levels, all of which could be loosely lumped under the personality trait of integrity.
Maybe they preferred that over letting some pleb engineer into the executive aristocracy.
My point is more that you don’t want people focused on business and profits instead of people who have deep knowledge in the area and passion for the product.
Accountants and business majors are better at managing insurance companies, banks, etc, because they understand the space. Engineers are better at managing engineering companies for the same reason.
gasp, there's that evil "business" word again
Having a production engineer as an exec is probably the best way to run a successful team if you project involve multiple field of knowledge (as Apple probably does).
Tim Cooks understand tradeoffs, and this understanding should be expected of any top exec. Is it often the case?
But isn't focusing on business and profits also focusing on safety of your products since you want to make sure your planes don't crash and passengers come to their destination alive and unharmed.
(2) profit = selling price - production\development cost - expected downsides of accidents(penalties, tarnished image).
"Expected downsides of accidents" can be reduced by reducing risk, but also in some other creative ways (blackmailing, lobying, promoting the right candidate, marketing, rebranding, migrating to different markets, insurance, coverups. And lets not forget deals with friends: If I can win 5billion, I can allow my self to split it 100 ways and still end up with a nice big yacht).
In practical terms, it doesn't appear to work out that way.
You can argue all you want about who shoulders more responsibility, but Muilenberg was an executive throughout the entire program, and more importantly, was the CEO who oversaw the decision for the certification of the MAX prior to first flight, which was the critically faulty decision.
Though of course he would have had the knowledge to understand something didn’t smell quite right after. Whether he had the sole authority to order a delay or redesign in the intervening time is questionable. It may have been that he couldn’t wrangle enough support from the board to do something dramatic.
The book even had a solution. These quick-thinking managers avoid responsibility (blame ability) like vampires avoid the sunlight. The corporate could implement a system to track responsibility, so it would follow smart assess in other departments and even other companies, but it of course would never do this because such a system would expose shenanigans of senior management. In theory, a regulator could develop such a responsibility tracking system and enforce it in public companies and federal contractors. That system needs to account for the fact that senior managers are experts in diffusing responsibility.
This being a partial byproduct of the mass centralization (aka conglomeration) of most every big industry that started in the 80s, accelerating in the 90s, when globalization became a hot thing. And [insert massive finance company's hackery here].
Tons of these conglomerates have strong legacy gov connections and are often the only shop in town for critical industries and are treated like special semi-national bodies. This puts plenty of natural pressure on regulatory bodies.
Boeing is not the only one. This is a phenomenon wide across the western world. Plenty of this exists in Europe too.
In every sector, there's more regulation, much fewer & larger players. If the rot at Boeing is a symptom of this, we're in for a bad time: every firm across the entire economy is now larger and has fewer competitors than previously.
Like most things in economics the best route is looking for the least-bad option. We will find out over time if the state-capitalism balancing act really is the best, assuming there are any realistic alternatives and/or the scales/ratios of state vs capitalism are meaningfully measurable.
This experiment is only decades old in the modern technological era and one could argue it has only really peaked in the last two decades, with ever more industries getting merged to this day (which Corona will accelerate no doubt, just like 9/11 did with the US defense industry).
The state/nationalism part of this means these potentially poorly run companies could stay propped up for decades, despite the industry's potential in other forms.
I recently spent time reading about some chartered airline companies from the 70/80s and their stories is probably the best example of this sort of slow march towards industry conglomeration, with plenty of state involvement and protection. It probably provides a good timeline to base this stuff on and at a minimum plenty of analogies.
One example (see History): https://en.wikipedia.org/wiki/TUI_Airways
I don't have an actual refutation here (and certainly don't want to start some kind of Apple flame war) but something about this doesn't seem quite right.
Like their products or not, Apple has been extraordinarily successful both in terms of sales and critical reception of their products compared to most companies.
They have flops too (Siri, HomePod, others), but are mostly successful. The recent buzz about the M1 chip is a perfect example of their industry-leading engineering.
Or the airpods with non-replaceable batteries so you have to get new airpods for $49+ a piece every couple years?
They aren't perfect and IMO haven't been in a long time. That said, the build quality is good, and I chose to get a macbook as my work computer as a software developer and don't regret it, but I wish people would stop putting apple on a pedestal as the example of perfection.
The company I work for had 1-2 percent of devices in repair every week.
Not sure if this is just a strange coincidence, but I know of at least one other company in our town with the same scope of the described problem.
I know this isn't a popular sentiment with some people, but from experience, I am done with Apple after 28 years of experience. My first was a beautiful Macintosh Classic I still have. Together with a SE 30. Somehow I miss my pre 2018 Macbook Pro.
This site includes a few different sources, and shows more or less the same reliability:
Now the butterfly keyboard issues have hurt MBP customer sat levels, but not enough to fall to Lenova/IBM levels.
Because they are.
Edit: Overarching point is that Apple has a focus on aesthetics that is far less important in aerospace engineering, and has no experience on ensuring human safety.
But it’s better than almost everyone else, including Boeing because it does one thing very well. It doesn’t ship products unless they meet a high bar. It never puts schedule first over product quality.
Example: original iPad was canceled by Steve Jobs because he didn’t think it was good enough. Instead he had the team enter the Apple phone competition, where it best out the iPod team with its design for the iPhone. Five years later they got to apply all their improvements to make and release a much better iPad.
Apple canceled their AirPower charging mat rather than release something that didn’t meet their standards, even after pre-announcing it.
When I ran an product development organization, I made it clear that QA wasn’t responsible for our schedules. Sure they needed to test well and quickly to ensure that Product Management had the necessary info to make good release decisions. But their job was journalistic, to fairly and honestly report all issues. It was up to the engineers to find ways to meet quality goals in our schedules.
Boeing had test pilots misleading regulators to hide known issues. That’s the exact opposite of a test Organisation should be run.
I thought about their butterfly keyboards and didn't want to think further.
Awareness of these factors can go from simply recognising them (lip service), to defining business performance by them (living and embracing them).
If someone doesn't pick these things growing up, a course in grad school isn't going to change their motivations.
Greed can be found in any person regardless of his profession.
Apple has to be one of the worst examples - both about not being run be MBAs and quality engineering.
Sun Microsystems had this. Didn't work too well for them.
It's not at all as simple as this.
If you read into most of the arguments for remote-friendly workplaces, step one is cultural changes.
So should our government.
Personally, I work as a chem/materials engineer if I were to move into a management position I'd have to give up doing technical work and step into a more administrative role and that is something that does not really appeal to me.
I think similar thing for politics, there doesn't tend to be many scientist or engineers running for government because that sort of thing isn't very appealing to people like me.
Boeing's choice to pursue the Max vs. a new airframe was entirely motivated by perceived cost benefits and resulted in a flawed and delayed product. Had the decision makers had an aerospace background they may have made different decisions.
I was just so used to the top three or four tiers of corporate management having literally no idea what their company's engineering department actually does day to day. Hearing a CEO knowledgeable about their main product line was a bit of a shock.
But it shouldn't be a shock! It should be the norm.
I work for a small IT-only company. If I start using "technical" terms like "IP address" with our CEO, his eyes glaze over...
I suspect there is a cause and effect relationship here, a CEO with an M&A background will always see the company this way. A CEO with a product background may make the companies customer's/product/team more valuable to an acquirer.
The M&A culture of the 80s was pretty toxic, businesses that financed their own expansion/revamp in lean times were looted for their bank accounts during deep recessions. The "survivors" now run with only a few months in the bank, making the whole economy more dependent on financial liquidity. We'll probably never know whether financially lean enterprises were more capital efficient or just riskier.
The incentives just align better.
The implementation sure was. As directed by company management + execs.
I'd like to see in jail those who make decisions, and earn salaries and bonuses accordingly to the responsibility they have.
Earning tons of money and having no responsibility when things go south makes total no sense to me.
Because they can get away with it, the political, cultural and legal environment they operate under allows it.
I also agree it makes no sense, either personally or from the standpoint of society at large.
> > wonder why executives earn so much money when there is no responsibility on them when things go wrong
It's not a logics based world we live in, but rather bipedal animals doing what they want and can :-/
The word you are looking for is "oligarchy".
Legal responsibility? Other than that, I've seen executives held responsible just as much as non-executives in my career, from firings to demotions to "transfers". It's not a magical suit of protection +3.
> I'd like to see in jail those who make decisions
Then no one would want to make decisions, other than psychopaths. No thanks. It's unrealistic to think everyone can know the consequences of every decision they make.
That's lazy. We hold individuals accountable for the choices they make. If you get behind the wheel of a car while drunk and get caught, you get in trouble. If you kill someone due to negligence or intentionally, you get in trouble.
These execs knowingly cut corners and then conspired to cover their asses when things went wrong. This is not an edge-case where something went horrifically wrong that no one saw coming. Warnings were raised and processes in place to protect consumers were ignored. They should be jailed.
I kind of think that just getting fired for being partially responsible for the deaths of 100s of people is definitely getting off easy. They got people killed and caused billions in losses for other companies. Someone that steals a car goes to jail for up to 10 years. Which person had a bigger negative impact on society?
"Then no one would want to make decisions, other than psychopaths. No thanks. It's unrealistic to think everyone can know the consequences of every decision they make."
They build aircraft that fly at 30k feet stuffed full of people. Without actual legal consequences beyond docking paychecks, it is a recipe for disaster. How exactly are we supposed to stop the literal gambling with peoples lives because of the potential for a large upside and with the only downside being that they won't make lots of money (so, they just end up even and don't actually lose anything). Las Vegas would go bust in a week with rules like that.
Now who pressured the pilots to act that way, who knows?
The employees, including execs, still have liability. Assuming prosecutors have the motivation and guts to charge them.
Are you going to cheap out and hire a lesser candidate to save a few million?
That it’s not an exact science and frequently fails doesn’t mean you shouldn’t do your best to get your best candidate.
Are they for real?? Exactly whose decision was it to present the plane as another 737 to avoid a full recertification? Some junior guy decided the strategy instead of senior management?
There are already enough laws to put top executives in jails, it's just that the laws aren't used.
Looking at historical trends at https://www.macrotrends.net/stocks/charts/BA/boeing/ebitda it
looks like it's something like 25% of an eyeballed "average year" for Boeing.
I suspect you're right that this is a little low given what was going on here.
In essence, doing the right way would have been cheaper.
Because it's saying "criminal monetary amount" but I'm not sure this refers to all compensations. Maybe it's only compensations in the US?
A lot of talks with customers were confidential and probably did not involve only monetary compensation
My question, are there still dumbstruck individuals to the point of not noticing?
- Responsible for 2 plane crashes that killed 346 people
- Engaged in a government cover-up and was charged with criminal fraud conspiracy
- Fired CEO left with $81 million exit package
- No one went to jail
*Fined $2.5 billion - 2% of annual revenue
White-collar enforcement is at an all time low: https://www.bloomberg.com/news/articles/2020-08-10/trump-ove...
This seems like a clear fact, and yet many will call you a conspiracy theorist for pointing out the obvious. It's probably a symptom of the tribalist aspect of red vs blue. People need to be de-programmed of the team sports to finally realize that their "side" is beholden to corporations and not the people. Only then will we see real action to criminalize white collar behavior.
Low regulations AND low government involvement.
So lots of people can build widgets. Companies that do a bad job find they have no customers.
New companies pop up, do a better job and things get cheaper and or better.
High regulations means that new companies need massive capital to enter the market. So much so that no one bothers.
When only 1 company builds a widget. Well odds are it’s going to be low quality and expensive.
Now this all has to balanced that you don’t massive unsafe planes flying around by companies that have no reputation to preserve.
Whoops, we took out the Golden Gate Bridge, again. We will go out of business and company mark 3 will try again
Huge natural barriers to competition.
The Boeing situation is a little different, of course, since it really did kill a bunch of people.
No one can prove a specific Boeing executive's actions caused people to die. There would have to be an email from the executive stating
"I think we should cut costs here and here and I acknowledge this may cause x% of passengers to die".
And they're not going to put something like this in an email either:
"Meet with the guy that used to work for us who now works at the FAA and get him to waive or lower so and so standards so this plane can fly and we'll owe him".
Lessen the punishment of street criminals.
None of this SF bull-crap where we basically don't punish the bike thieves, shoplifters and porch pirates but still find people hundreds of dollars for doing donuts in empty parking lots or not obtaining a permit before building a deck on their own house.
I'm fine with not doing squat to deter victimless crime but we can't allow the punishments for crime with a victim to be so low that it's more lucrative than a real job even after being caught many times.
I see your point and it's hard to imagine that a person stealing say, some food, because they're starving may do time in prison and yet the author of a multimillion shenanigan goes scot-free, yes that's not fair at all, but lowering the punishment for street crime will make us average people even more miserable. The only rational thing to do is start punishing white crime seriously so it is a huge deterrent. Currently white criminals who get convicted stay in prisons whose conditions are better than the situation of a lot of struggling full time working Americans. I find that appalling
The only solution to this is electing more people from diverse backgrounds (inc. class, race, gender, etc), but unfortunately money is extremely effective at winning democratic elections, and those who have it aren't from a diverse background.
It also has something to do with plausible deniability and inability to prove intent with white collar crimes.
How would you be able to prove someone intentionally mis-valued assets? Cut costs specifically to bolster one's own income and not benefit the other shareholders? Hired someone in exchange for a favor or possible future favor? Fired someone for stepping out of line?
Plausible deniability is also the reason for "productive" in person lunch meetings and golf outings. Not that there aren't other positive aspects of in person conversations, but lack of a permanent record is one of its aspects, and can easily be used to cause harm.
Meanwhile the country is literally controlled by the companies in question.
At least one of the states has a statutory value of a life, but I'm afraid I can't find it now (don't Google it, you will be fed into the intake funnel for wrongful death lawyers), but I think it is around $7M.
That said, $500M is for a victims' fund, about $1.4M/death, the rest appears to be a deterrent to deceiving regulators
What should be shamed is a tax code that differentiates dividends and buybacks.
In a vacuum, sure, it's not a bad thing to return profits to shareholders, but that's only like 1/10th of the story here.
Silicon Valley isn't immune to the same virus.
I am not saying this to be snarky, but is it not the generally held belief that VC stands for Vulture Capital?
I realize not everybody shares this belief, but I think a lot of people do - maybe even most.
For what it's worth, I've been reading HN for over a decade, and am a co-founder of a now almost decade old startup and have never seen this phrase
But maybe I'm just one of today's lucky 10,000
All while ~350 people died. I find it a disgusting comment.
Ultimately they'd get a government bailout of some sort if push came to shove.
It would have to close all offices/manufacturing sites and fire all employees.
Suppliers and customers would have to be compensated, which would also probably result in lots of lawsuits.
It would mean bankruptcy for most companies out there.
Suspending is more or less equivalent to just shutting it down.
But yeah, a 2.5 billion fine is not much more than a slap on the wrist for a company with a revenue of 76 billion (2019).
So not much different than when a person is imprisoned. Good luck not getting fired and having debts rack up.
Such an existential threat seems like a very good way of scaring corporations into compliance (well, among other things).
Employees out of a job , suppliers losing contracts, customers never getting what they might have already paid for, creditors losing the debt, share holders lose all their investment.
Especially with a huge corporation like Boeing with 160k employees and billions flowing in and out, the effect would be huge.
Like I said, I agree there needs to be some way to punish, but just shutting it down would punish a lot of parties that aren't not responsible.
> Employees out of a job , suppliers losing contracts, customers never getting what they might have already paid for, creditors losing the debt, share holders lose all their investment.
This is what bankruptcy proceedings are for. A similar procedure can be made up for a "corporate death penalty".
>Especially with a huge corporation like Boeing with 160k employees and billions flowing in and out, the effect would be huge.
If the government was doing its job, corporations of this size should not even be allowed to exist for precisely the reasons you mention. But since anything goes in corporate America, here we are.
> Like I said, I agree there needs to be some way to punish, but just shutting it down would punish a lot of parties that aren't not responsible.
I would argue that people being indirectly hurt would be a good motivator (or reminder) for people being more picky who they do business with. If you don't learn your lesson the first time, then being burned multiple times will (hopefully) get the message across.
If we create limited liability entities that can be criminally charged, they should be treated analogously to a person, or their corporate officers or owners should stand in the company's stead. Right now, corporations have an unprecedented ability to simply pay a large fine for a murder conviction. That is not an option for an individual convicted of murder.
Perhaps forcing a new exectutive staff and/or board in some way, but don't see a literal state takeover ending well.
Oversight and managment/operations need to be separate. This mess happened partly because Boeing was given too much leeway in performing their own oversight.
Because...it's an abstraction that is not physically embodied and can't be imprisoned.
> a person can be removed from society and their ability to act freely can be removed, why can't you simply suspend their corporate charter for a period of time?
Suspending a corporate charter isn't equivalent to jail, it's equivalent to a reversible death penalty; the corporate charter is the source of legal existence of the corporation. Without a charter the corporation doesn't exist, can't be subject of legal action, can't own property, etc.
I'm not really convinced that that makes any sense as a punishment (or even that temporary impairment that would be more analogous to imprisonment would.)
People can be remediated by that kind of punishment, maybe, but abstractions like corporations probably cannot. Better to either dissolve them or exclude the bad individual actors from them and let them continue.
I do believe if we had any social imagination at all we could think of many many ways to materially punish bad actors. Like forcing a negative dividend, punishing/fining executives or board members personally, etc. People who own and control corporations need to have some skin in the game. Fines that are expended (or worse, appealed in court and subsequently never paid) are, evidently, too far removed.
The bigger and more important you are, the more people are affected by both you breaking the law and you being punished with imprisonment for doing so. A corporation is only different in scale.
I have seen a couple cases of someone punished for a white collar crime sent to jail, effectively a vacation, while his family suffers terribly.
They punished the wrong person and I feel it's a travesty.
Jail is not the right punishment for nonviolent offenses.
A "company" is a bunch of decisionmakers (execs). Start jailing them for this crap, and watch the rest of them fall in line. Losing your freedom for 15 years is a great motivator for good behavior.