Hours after a second expert air safety panel sharply criticized Boeing and the U.S. Federal Aviation Administration (FAA) on significant judgement and oversight missteps in the certification process of the Boeing 737 MAX aircraft, Boeing’s board has elected to strip CEO Dennis Muilenburg’s role as company Chairman.  David Calhoun, lead director of the Board will now assume a non-executive Chairman role.  Grounded Boeing 737 MAX's

In the announcement to investors, the Board indicated that: “splitting the Chairman and CEO roles will enable Muilenburg to focus full time on running the company as it works to return the 737 MAX safely to service, ensure full support to Boeing’s customers around the world, and implement changes to sharpen Boeing’s focus on product and services safety.”

Mr. Muilenburg indicated in a statement that he fully supports the decision and that the company’s resources remain focused on returning the 737 MAX safely to operational service.

On Friday, a panel consisting of inter-agency U.S. safety experts along with representatives from nine other foreign regional safety agencies pointed to inadequate FAA oversight of the aircraft along with Boeing missteps to properly assess and communicate critical design changes that were initiated in the 737 MAX’s flight control system. The report by the Joint Authorities Technical Review (JATR) was commissioned by the FAA in March following the Ethiopia Airlines crash to analyze the process regulators conducted in certifying the aircraft, along with its computerized flight control system.

This was the second air safety agency to make similar conclusions. While both review panels have not cited any evidence of a deliberate effort by Boeing to mislead regulators, they have pointed to poor communication and lax oversight.

The global operational fleet of Boeing 737 Max aircraft remain grounded since March following crashes in Indonesia last October and in Ethiopia in March that together killed 346 people.

Considerably noteworthy in the latest findings was a recognition that aircraft designs have become more complex with various systems having to interact with other systems and controls in unforeseen ways. They further raised questions about the increased use of software automation in aircraft and respective pilots’ abilities to step in and take over if autonomous software actions fail. That is a significant finding with far reaching implications not only for the aircraft industry but other industries working on autonomous operating systems that involve high safety concerns.

Former National Transportation Safety Board Chairman Christopher Hart, who headed up the latest joint global agency review, indicated in a press conference:

This is not just an airplane problem, but an airplane-slash-pilot problem. FAA and regulators around the world need to better recognize this new reality of super-complex automation and pilots not necessarily understanding how to operate it.

Further noted: “As automation becomes more and more complex, pilots are less likely to fully understand it and more likely to have problems and more likely to encounter scenarios in real operations that they haven’t seen even in a simulator.”

Boeing issued a statement indicating that the company is committed to working with the FAA in reviewing the recommendations and findings and in improving the process and approach used to validate and certify aircraft going forward.


Implications of the Latest Executive Move

Going forward, one would surmise that Boeing is scrambling to continue to have a laser focus on returning the 737 MAX to operational service while at the same time, addressing observed deficiencies in aircraft design development, certification and pilot training process needs.

The latest reports indicate the company still working on an updated software design for the aircraft’s MCAS flight control system with anticipation that the FAA will re-certify the aircraft by the end of the year. Other global based regulators as well as the FAA remain non-committal to a specific return to service timetable.

Coupled with that is a herculean logistics effort to prepare both grounded and manufactured aircraft all of which are parked in storage, for needed software fixes and operational service preparation. Once the MAX is returned to service, the focus quickly shifts toward re-ramping the production schedule back up to needed 2020 monthly volumes.

To make matters even more challenging, the FAA and global regulators have become increasing concerned with premature fatigue indications of what is termed the ‘pickle-fork’ on the NG version of 737 aircraft family, the aircraft that are picking up the slack of grounded MAX versions. This component is the part used to attach the aircraft’s fuselage to its wing structures, and needless to state a critical part structure. Emergency inspections were ordered for all operational aircraft and one report we reviewed indicated that 25 percent of inspected aircraft shows signs of premature pickle fork cracking.

The decision for Boeing’s CEO to solely focus on existing design engineering and operational challenges is obviously well timed and sends an important reinforcing message to Boeing’s employees and indeed the entire 737 supply network for added checks and balances.

These are serious times for this company with significant implications for customer, regulator and airline customer perceptions.  The stakes are significant in corporate wide, supplier as well as individual career context.


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