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Posts Tagged ‘Boeing 737 Max’

 

These days, while boarding a flight, one’s nerves are all of a twitter, wondering which model of aeroplane will be ferrying one. If it happens to be a Boeing 737 Max, the soul sickens in horror. One imagines the plane crashing within a short time of having taken off. One starts reviewing one’s insurance covers. One worries about the welfare of the family. One thinks of the kind of closure the near and dear ones may never get if one’s mortal remains are never traced.

This is not to say that one necessarily fears death. Like taxes, it is inevitable. But what one shudders to think of is the kind of trauma one may undergo a few minutes prior to the actual event, after which, nothing else would really matter!

Thus, while boarding a plane these days, a lay passenger perhaps has two prayers on her lips. The first one is that the plane lands at its destination safely. The second one is that the captain will not be flying it while working from home. Whatever the advances in technology, a human being is still valued as a safer bet!

All this is thanks to the Boeing 737 Max issue which has been making headlines since 2018. Just to jiggle our memory cells a wee bit, here are the facts as yours truly understands them.

Some Facts of the 737 Max Case

In October 2018, Indonesia’s Lion Air flight plummeted to the ground shortly after taking off, killing all 189 people on board. Subsequently, in March 2019, a crash happened in an eerily similar manner in Ethiopia, killing all 157 persons aboard.

Boeing claims to work on such ‘enduring values’ as integrity and safety.  The company defines integrity as taking ‘the high road by practicing the highest ethical standards.’ Likewise, safety is captured thus: ‘We value human life and well-being above all else and take action accordingly,’ the company suggests, and that ‘by committing to safety first, we advance our goals for quality, cost, and schedule.’

But to match the launch of A320neo by Airbus, said to be 15% more fuel efficient, Boeing moved fast and launched the 737 MAX nine months after Airbus’s announcement. Regulatory approvals were apparently rushed through, by simply declaring the 737 MAX to be merely a ‘derivative’ model of the company’s cash cow – 737. Technical changes of a material kind were apparently made, but the need for pilot training was never highlighted. The Flight Crew Operating Manual was not modified to reflect the changes. If this had been done, perhaps the pilots might have been in a better position to know what to do should the plane begin to behave unpredictably after take-off due to bad sensor data.

According to a Reuter’s report, a Joint Authorities Technical Review done in 2019 had harshly criticized the US Federal Aviation Administration’s review of a safety system on Boeing‘s 737 Max jet that was later tied to two crashes that killed 346 persons.

An 18-month probe into the sordid affair subsequently led a US congressional committee to put the blame on ‘repeated and serious failures by Boeing and air safety regulators.’ The committee spoke of ‘a culture of concealment’, whereby the company withheld key information from regulators. Undue influence unleashed upon the FFA seniors marred oversight.

The plane remained grounded worldwide from March 2019 to November 2020. In November 2020, the plane was once again certified by the USA authorities as being fit to fly once necessary modifications had been made. Regulators in the EU are expected to do so now.

In January 2021, Boeing agreed to shell out a compensation package of $ 2.5 billion to settle a Justice Department investigation and admit that employees misled regulators about the safety of its 737 Max aircraft. The US government and the company said that the settlement includes money for the crash victims’ families, airline customers and a fine.

This obviously does not bring back the dead. Nevertheless, it is a matter of some satisfaction that Boeing finally revealed a streak of consciousness in their dealings with diverse stakeholders.

The New Story of Business

Western experts had originally recommended Command and Control as a means to generate wealth and had gone on to imply that stark materialism is the way to seek peace and happiness. However, the Eastern approach is based on an inward blossoming, an inner growth and development. This approach holds an inner glow of success to be superior to sensual gratification of an external nature.

By proactively adopting a Conscious Capitalism approach, several businesses have already recognized the truth that they have a greater purpose, much beyond delivering value to their own stakeholders.

Conscious businesses have trusting, authentic, innovative and caring cultures that make working there a source of both personal growth and professional fulfillment. They endeavour to create financial, intellectual, social, cultural, emotional, spiritual, physical and ecological wealth for all their stakeholders.

There are many labels for an approach of this kind. Compassionate Capitalism, Humane Capitalism and Inclusive Capitalism are some. Socially Responsible Investing and Impact Investing are others. Nilima Bhat and Raj Sisodia label this as Shakti Leadership, highlighting the need for balancing masculine and feminine aspects in decision making. R Edward Freeman refers to it as Stakeholder Capitalism. According to him, profit and purpose, humanity and economics, business and ethics can go ‘and-in-hand’!

Is Boeing now taking a Conscious Capitalism route?

One has no information in the public domain as to the internal changes made by Boeing so an incident of this kind does not recur. But based on what one already knows, the following conclusions may be safely drawn:

  1. In order to beat the competition, Boeing 737 Max was declared to be a ‘derivative’ of its predecessor and not a new model.
  2. Regulatory approvals were rushed through.
  3. Software changes were not effectively conveyed to pilots; Flight Crew Operating Manuals were not upgraded.
  4. It took a rap on its knuckles by a Congressional Committee, and then by the Justice Department, for Boeing to admit to misleading regulators and declaring the compensation package.

In this case, we may all draw our own conclusions.

Corporate’s tendency to cosy up to regulators and the governments of the day is understandable. But when it amounts to disregarding their self-proclaimed values of safety and integrity, thereby endangering human lives, they would appear to believe in the model of inhumane and unconscious capitalism.

Those who happen to advocate the cause of Conscious Capitalism and Ethics in Business fondly hope that this case eventually proves to be a ‘Corporate Soul Awakening Moment’ of sorts for the 105 year old outfit.

 

(Notes:

  • Written with no malice towards anyone!
  • A version of this post would appear in a yet-to-be released book which connects Bhagavad Gita to Management) 

 

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When leadership deficit leads to a compromise on values  

It is understandable that our business leaders keep biting their nails trying to beat the competition. But when they chase business goals by compromising on their core values, they eventually get caught in a regulatory web and start losing customers. Their brand image takes a serious hit.

Consider the following instances:

The 1986 Space Shuttle Challenger disaster 

For a space exploration agency of the stature of NASA, revenues and profit were not the motives, but it appears that deviations were indeed made from standard safety protocols because the top leadership put a higher premium on expediency. The now infamous O-ring pressure seals, supplied by a Utah-based contractor, served as the cause of the crash.

The O-rings had been tested to perform in 40-degree Fahrenheit or above weather conditions. On that fateful morning in Florida in 1986, it was only 18 degrees. NASA knew it was an issue, but hours before the launch pressed the contractor to “green light” the launch. Robert Ebeling, heading a team the concerned contractor’s employees experienced with the O-rings debated whether they could knowingly approve that the O-rings would not fail.

In the end, the team wanted NASA to wait until the afternoon when temperatures would be closer to 53 degrees Fahrenheit. Due to the pressure exerted by NASA—in addition to the wilting of the contractor’s senior managers—the company reversed its original decision and ended up giving the go-ahead for launch.

Alas, Challenger broke apart 73 seconds into its flight, killing all seven members on board.

The Samsung Galaxy Note 7 fiasco

During 2016, Apple was set to launch the iPhone 7. Samsung leaders rushed into bringing Galaxy Note 7 into the market before Apple. Here also, market forces determined the behaviour of the company’s management. In a rush to beat the competition, a design flaw in the battery was overlooked. Safety standards were apparently compromised.

Within weeks of the launch, the phones started catching fire. A recall ensued with over 2.5 million phones sent back to Samsung. The company lost billions of dollars in the recall, let alone billions more in lost revenues.

The Boeing 737 Max Issue

In October 2018, Indonesia’s Lion Air flight plummeted to the ground shortly after taking off, killing all 189 people on board. Subsequently, in March 2019, a crash happened in an eerily similar manner in Ethiopia, killing all 157 persons aboard.

Boeing claims to work on such ‘enduring values’ as integrity and safety.  The company defines integrity as taking “the high road by practicing the highest ethical standards.” Likewise, safety is captured thus: “We value human life and well-being above all else and take action accordingly,” the company suggests, and that “by committing to safety first, we advance our goals for quality, cost, and schedule.”

But to match the launch of A320neo by Airbus, said to be 15% more fuel efficient, Boeing moved fast and launched the 737 MAX nine months after Airbus’s announcement. Regulatory approvals were apparently rushed through, by simply declaring the 737 MAX to be merely a ‘derivative’ model of the company’s cash cow – 737. Technical changes of a material kind were apparently made, but the need for pilot training was never highlighted. The Flight Crew Operating Manual was not modified to reflect the changes. If this had been done, perhaps the pilots might have been in a better position to know what to do should the plane begin to behave unpredictably after takeoff due to the bad sensor data.

The common thread running through all these instances is the leadership deficit these organizations faced at the time. When values become mere words on a company’s website, disaster just lurks around the corner. As technology advances, the human angle can only be ignored at the risk of a great cost to the organization as also to the society at large.

Of revenue-hungry businesses and governments

World over, history has repeatedly taught us that when it comes to the Rajasic world of commerce, truth is a casualty. Cigarette and liquor manufacturers contribute to the exchequer and also keep their own stakeholders happy. Pharmaceutical companies keep peddling drugs which may have serious side effects on hapless patients. After holding up cholesterol as the main villain for cardiac problems for a very long time, suddenly we find that medical research comes up with results which are contrary to the original stand.

A recent example is that of the mad rush to bring in 5-G which rides on a much stronger dose of radiation. Nowhere does one see a reasonable debate on the impending costs of environmental degradation owing to a high dose of radiation.

The risk of data privacy

As businesses and governments go in for higher levels of digitisation, lay citizens who avail of products and services end up living in more transparent fish bowls. Individuals cease to matter. Somewhere in a data repository, they become mere numbers, coded by a binary system and mercilessly crunched into big data; data which is eagerly lapped up by the corporate world.

One who loves undergoing a Virtual Reality experiment is shocked to find that he and even his family members are denied an insurance policy because the body reactions detected during the said experiment indicate that he is likely to be suffering from dementia, a disease which runs in families. One who books a bnb apartment has to not only substantiate his true identity as a living person, but also establish that his past legal record is as pure as fresh driven snow. Personal interactions with a customer have ceased to matter in most digital transactions.

Hapless customers and citizens are no longer kings and queens; they are jacks of all trades who master none, let alone themselves or their own thought processes.

Political parties have already perfected the art of using Artificial Intelligence and Data Analytics to shape public opinion en masse. There are no bad politicos and good politicos. Scratch the surface and one would find that underneath they are all the same. In many countries, democracy is touted as a virtue, but just beneath its soft velvety cover can be discerned the cloven hoof of dictatorial tendencies.

Caveat emptor (or, buyer beware) is the only way forward!

Some lessons from Bhagavad Gita

Smart CEOs can perhaps look up to this ancient scripture to find some ways out of a quagmire of this kind. We explore this theme in the next part.

 

(Inputs from an IT expert and an aviation expert are gratefully acknowledged)

(Related Post: https://ashokbhatia.wordpress.com/2019/09/07/the-challenges-of-industrial-revolution-4-0-part-1-of-3)

 

 

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