Boeing’s response thus far to the tragedies of Ethiopian Airlines Flight 407 and Lion Air Flight 610 is a case study of what not to do in a crisis.
Boeing has allowed others to tell the story about what might be happening with its planes and is losing significant credibility. The company appears to be shirking, rather than acknowledging, its role in this devastating situation.
Boeing repeatedly insisted in press releases and in an email to employees from CEO Dennis A. Muilenburg, that its planes were perfectly safe. The problem is that a rapidly growing crowd of people didn’t believe they are.
Instead of addressing what the rest of the world was acknowledging — people don’t want to fly on a plane that might suddenly crash — Muilenburg personally lobbied President Trump about the plane’s safety.
Before long, what had been a trickle of doubt about the safety of the 737 Max became a global flood of demands that the planes be grounded.
The narrative shifted from questions about the plane’s safety to questions about why Boeing, and the Federal Aviation Administration, were refusing to act.
These are completely reasonable responses after two crashes of 737 Max planes and the loss of nearly 350 lives over less than five months.
Still Boeing refused to budge.
European Union, Singapore, India, Indonesia, China, Australia, and Turkey, among others, banned the plane from their airspace until questions about its safety could be resolved. Canada followed suit, followed quickly by a dramatic announcement from President Trump that he was ordering the plane grounded in the U.S..
Only then did Boeing chime to say it supported the decision.
The company’s stock has dropped nearly 13% for the week, but the hit to the company’s credibility will almost certainly be greater.
Boeing outsourced a decision and communications about the safety of its own products to others. This isn’t a good look.
Boeing appears to have forgotten what it’s selling and to whom.
The company isn’t just selling airplanes to airlines, it’s also selling safety and reliability to travelers, and their families.
Travelers were worried the 737 Max wasn’t safe or reliable, and Boeing was unable to convince them it was. The next step should have been for Boeing to urge airlines and authorities to take the plane offline until its safety was confirmed or identify what needed to be fixed and fix it, right away.
The problem is, outside of Boeing, it hasn’t looked like that. It looks like they’re waiting to be told what to do rather than just doing it.
When people started dying in 1982 because someone poisoned Tylenol with potassium cyanide, Johnson & Johnson issued a nationwide recall, urged people not to take Tylenol and established a hotline for worried customers to call.
It didn’t wait for the Food & Drug Administration to tell them what to do.
The recall cost the company millions in lost sales but consumers, regulators and the media lauded their management of the crisis, and the company’s reputation was burnished, not blemished.
At least in the case of Tylenol, it was known what was killing people: somebody had tampered with their product.
The situation is far more grave with Boeing because nobody appears to know what’s happening with the 737 Max.
A crisis can also be an opportunity to show customers and the public what a company’s values are. This was an opportunity for Boeing to worry less about liabilities and show more concern for their ultimate clients: travelers around the world, and their loved ones.
Instead, Boeing blew it by letting others make decisions for them about their own products; Muilenburg missed an opportunity to get this right.
At Pathfinders, we often discuss such case studies on Crisis Management.
Suresh Shah, Pathfinders Engterprise
My above thoughts are based on talk by Tom Vogel of Dukes Linden Public Relations