Ralph3

No..sorry, I should have been clearer. I was just remarking on your years of service.
I retired from an Ag business in MI in 2015

I might read that one...I also see the book 'Fall From the Sky'...looks good also.

Phil Condit was a peach too.

There is an inherent conflict between the goal of making the most short term money and the goal of making the best and safest airplanes. Boeing abandoned the latter in favor of the former. With predictable results.

http://forums.pelicanparts.com/uploa...1645891131.jpg



I just ordered this book, watched the Netflix program a couple of days ago.

Watched it - what a lightweight singsong tale. OMG there's a bad greasy story there that they didn't tell. No interviews with the engineers that worked on the system? They need access to the inside story.

I really expected movie to go into the details of the doj deal with boeing, how exactly did those negotiations go? Only prosecuted the loudmouth test pilot with the incriminating emails and the execs all walked - get to retire to their ski resorts. Here I won't be happy until their heads are on pikes.

Something thats super weird for me: the new ceo is calhoun. GE under welch, nielson, blackstone. I'd have thought I'd get a bad vibe from him but he's sure got my number. He opens his mouth its always exactly what I want to hear. Actions matter more than words but wow his words have been good. I'll never buy boeing but confused and surprised that I like calhoun even though I feel like I must be deluded.

I worked for McDonnell Douglas/Boeing for almost 20 years. I’ve met Condit and Stonecipher - Stonecipher on a few occasions - he even hung out in my cubicle for a while once.

While I agree with premise that “shareholder value” drove the company in the wrong direction, I strongly disagree that this can be blamed on McDonnell Douglas. I worked in one of the only (maybe the only?) locations where both McDonnell Douglas and Boeing had offices, so I had a front row seat to the way each company did things. I can state from my experience it was not McDonnell Douglas that diluted the engineering focus of the company.

It is laughably ironic to see Boeing Commercial Aircraft employees blaming McDonnell Douglas for their downfall after Boeing basically eliminated all evidence of MD commercial aircraft right after the “merger”. At the time, Boeing even refused to call it a merger. McDonnell Douglas was called a “Wholly-Owned Subsidiary of the Boeing Company” up until they did away with the name altogether.

I was proud to work for McDonnell Douglas. Boeing - not so much. I was a second-class citizen and left in early 2008.

100% true. I was working in Long Beach at the time of the merger, it was very sad to see the commercial line go away.

I traveled to Renton not long after the merger. I will never forget a Boeing manager talking about a Blue Angels show he had recently seen. It torqued me when he said how proud he was to see the Boeing F-18s performing. It still bugs me, actually.

I'm surely going to read this book. The docu on Netflix could only show so much. (I did enjoy it although)

Legacy McDonnell Douglass employees will no doubt have a different take on this than legacy Boeing employees. Both will defend their respective company's role in all of this. I guess that's commendable, to a point, anyway.

Impartial observers, aerospace industry analysts, are, however, pretty unanimous in their agreement. They all pretty much agree that the cause of all of this was that The Boeing Company adopted the failed management practices of McDonnell Douglass. These practices destroyed McDonnell Douglass and left the company in the position that allowed Boeing to purchase them. Once placed in charge at Boeing, Harry Stonecipher implemented those very same management policies that had caused McDonnell Douglass to fail.

This is all very, very well documented, by impartial outside observers and analysts. There are reams of written material outlining just how this happened, along with how it affected the company. Again, from independent industry analysts - not disgruntled Boeing employees looking for someone to blame.

This is, and I mean it, the most interesting thread here in a long time.

Management ethos in Aerospace is not like management practices at Amana.

McDonnell Douglas was in trouble long before Stonecipher took over. The writing was on the wall. McDonnell Douglas did not have (and could not raise) the capital to develop a new commercial airliner. Everything was just evolutions of DC-9s (MD-80, 88, 95 and the ‘717’ :rolleyes:) and derivatives of the DC-10 (MD-11). As a result they were always eating the scraps left over from Boeing and Airbus. Then we “merge” and the new Boeing has a commanding share of the commercial aircraft market. Then, Boeing kills off the MD commercial planes and 3-4 years after we merge, Airbus does the unthinkable and overtakes Boeing in market share. Hardly MD’s fault that early in the game.

The C-17 was struggling with structural challenges due to its revolutionary use of carbon fiber. The early 90s were tough. John McDonnell was a great guy, but the ironic thing again was that I think McDonnell Douglas was too focused on the technical side and not the financial and they just slipped into the red year after year…. Then came Stonecipher…

I was in the manned space flight part of the company (Spacelab, mostly) but transitioned to work on Space Station when we merged. Boeing had dropped the ball so badly on the ISS program (zero award fee one year) that McDonnell Douglas basically took over and pulled it back out of the ditch.

The Douglas Aircraft Company was once a proud, independent, "old school" aircraft manufacturer. They took chances, made investments - with their own money - much as Boeing had always done. They were deep into the commercial market, a far riskier market than the military market.

McDonnell Aircraft were a far different company. John McDonnell was infamous for not taking any chances with his own money. Risk avoidance was the name of his game. He was the personification of that old joke about how copper wire was invented - two Scotsmen fighting over a penny... He was all about the guaranteed military contract.

I worked with a few former Douglas engineers early in my career. Their opinion of McDonnell Aircraft was a foreshadowing of Boeing employees' opinions of McDonnell Douglas. They saw McDonnell Aircraft as the failed entity that had somehow swooped in and purchased (not merged with) Douglas. One of their funny remembrances of those days involved the yellow #2 pencils that they all used, with "McDonnell Douglas" imprinted in gold leaf on one flat. First thing they would do, before ever using those pencils, was feed them to a pencil sharpener until the "McDonnell" part was ground off.

It was apparently the McDonnell business model that precluded new aircraft development (at least commercial) at McDonnell Douglas. Like you said, endless derivatives of outdated aircraft. At Boeing, with 777 just entering production, we were all set for our next new, clean sheet aircraft. "Then came Stonecipher" (as you note below)...

Following the MD model, Harry would not allow a new, "clean sheet" design. At least not without engaging what he referred to as "risk sharing partners", per the MD model. All major manufacturers sub out work and, in the case of Boeing vs. MD philosophy, there was a very important difference.

At Boeing, we had always maintained design authority over every part on the aircraft. Oh, the various subs often designed the parts they were going to supply, but Boeing maintained absolute, final engineering authority over those designs - "final buy-off". And, regardless of who designed it, Boeing owned that design.

MD's "risk sharing partner" model was different in one very important respect - the subs, or "risk sharing partners", "owned" their designs and, more importantly, held absolute engineering authority over them. They were designed to meet a functional specification, how they got there was up to them.

I well remember the first time I was exposed to the ramifications of that philosophy. I (along with every other legacy Boeing engineer) received an "open letter" from one of our own, a guy who had been tasked to sort out cockpit integration issues on our newly inherited 717 (just another old DC-9 iteration). Raytheon and Hughs had each supplied some cockpit electronic component that did not "talk" to each other. At Boeing, we would simply drive the required design changes to one or the other or both until they played nice with one another. We had the authority to do that.

Well, not so at MD. Raytheon and Hughs owned their respective designs in their entirety, as "risk sharing partners". Each had independently met their design specs as provided by MD. As a result, there was no over-arching authority to compel either to make the required changes. The changes had to be negotiated and contracts rewritten, and, of course, money paid. Watching this unfold was a real eye opener to us Boeing guys...

We didn't know it at the time, but it was a foreshadowing of how 787 was going to be managed. Harry wanted us to sign on investors as "risk sharing partners" per the MD model. What ensued was the single biggest disaster in the history of The Boeing Company.

We signed on plenty of these "risk sharing partners". And then proceeded to squeeze them so hard, regarding both schedule and cost, that over half of them eventually made the very pragmatic business decision to default on their contracts and pay Boeing the penalties. Well, while in ever deepening trouble because of this trend, the old Boeing guys thought all was not lost - we could simply take what they had so far, find another supplier, and carry on...

Alas, not so fast - we didn't own these designs. We had no rights to them. Some of these "risk sharing partners" were willing to sell what they had developed to Boeing - for an exorbitant cost, of course, recouping their penalties and making a tidy profit in the meantime. Many were not, and simply (quite bitterly) told Boeing to pound sand. And Boeing didn't have the capital to buy the design data from the ones that offered it. This happened more than once on several systems, installations, and assemblies. Years and years of delays and billions in cost over runs later, we now knew the full ramifications of MD's "risk sharing partner" approach.

Oh, believe me, John McDonnell was laser focused on the financial side. Notoriously the cheapest bastard to ever play the aerospace game. It was his insistence that only government money be spent that killed MD, even long after he was gone. Stonecipher was a Jack Welsh "true believer" to begin with, and he found "heaven" under old man McDonnell's policies.

Never worked anything but commercial, so I cannot comment on any of this. What years were these?

So, anyway, this unfortunate situation on 787, the billions lost on that program through the disastrous adoption of MD's management philosophies, is what led to the 737 MAX. A 737 replacement (that thing predates 747, from the mid 1960's) was going to be our next project after 787. A brand new, "clean sheet", maybe all composite regional jet. 787 killed any hope of doing that. But Airbus was killing us in that market, so we "had to do something, even if it's wrong"... And boy, was it ever wrong...

Polishing a 50 year old turd, making terrible design decisions with regards to aerodynamics, and hoping to make up for it through computer intervention. The MAX is essentially "fighting itself" the whole time it's flying. These terrible engineering decisions were driven by upper management's policies and the company's lack of funding, squandered on 787.

Those upper managers get all of the glory when things go well. Big bonuses, stock options, all of that. Even if all they did was stay out of the way... Well, they should get all of the "glory" in the face of this kind of failure as well. Their decisions inarguably led directly to all of this. They need to be held accountable. Like in prison for the rest of their lives accountable. It's one of the biggest crimes of modern industry that they, with help from the politicians, have been oh so successful in shielding themselves from that responsibility.

Well, the C-17 did turn out fine with over 230 sold including FMS.

I have had friends at Boeing and I can read. The jury is in. There is no question the The Boeing Company was a first rate aerospace company and this is mighty easy to prove conclusively. it is just as easy to show that Boeing is now a dangerous company. When do we hold management accountable? Do we NOT do this when a formerly great company is now on the ropes? The buck should stop somewhere.

Watch "Downfall." Lots of details I could share here, but I'll offer this one: Records FINALLY were surrendered by Boeing. The settlement was $2.X billion to avoid criminal prosecution. Apparently Boeing management, knowing pilots would have about ten seconds to figure out and execute a solution, concealed even the existence of the MCAS software system which took control of the aircraft, adamantly refusing to provide training to pilots. Lion Air, owner of the first of the two crashes, begged Boeing for training. Boeing refused. Because......cost.

Guess you're lucky you don't get car sick too.

*****. Compare MD's contributions to aviation against that of Boeing.

Yes, it did. It is, by all accounts, a fantastic airplane. But - its initial per unit cost was pushing $400 million, at the time a 747 or 777 was about $120 million. Back to John McDonnell's guaranteed government contract. No way they could have ever survived the competitive world of commercial aviation like that. It's easy to "excel" when cost is no object, when the customer has bottomless pockets.

Really, why the vitriol? A comment was made about a C-17 development issue. I was pointing out that the issues were resolved and a lot of tails were sold. The program was a cash cow for years and a key element of Boeings military portfolio.

Well true, MD did not survive the commercial market.

I remember reading about the c17 software as one of the great disaster stories.

After airframe was final (after 2B? spent) the plane was found to be unstable at low speed/high angle of attack which apparently how you land on a short runway. People in charge decided it was a... software problem. They designed a system to prevent plane from ever finding itself in that situation. I guess you can say its a success because they sold a lot but why was the plane unstable to begin with?

Sounds a lot like mcas except you can't blame that the airframe design was 50 years old.

Above was in a software book. I'd love to hear the real story.

Oh, absolutely. Boeing/MD made bank on that program. Easy to do, though, on a guaranteed contract, otherwise know as a "cost plus" contract. No such thing in the commercial world.

Interesting. I had no idea that was the case. It does kind of serve to clear up the decisions made on the 737 MAX, where Boeing decided to "fix" inherent aero problems with software. Then not tell customers that is what they did, and subsequently sit back and watch three airplanes go in, all the while denying everything.

Again, highly compensated executives made the decisions that lead to all of that. "Heroes" who get all of the accolades (and money) when they "win", but never have to accept responsibility when they "lose". They should be lined up and shot... :mad:

To your first point, they were bringing down the per plane production cost. $150M, if I recall correctly was the target. I don’t know if they actually reached that.

Totally agree on the last point. My favorite move is when they bring in executives from another division to run the program for a short period of time. They make decisions to benefit their IC then move on to something else before the program feels the impact of their management.

Yes. I am held accountable by my deliberately selfish decisions. If by no one else, by me at least. My Pelicanhead friends are as well. Each of us has a conscience, I assume. Apparently, Boeing management is not bothered by such emotional dissonance. Boeing paid around $2.5 billion to "settle" this matter but here's the rest of that story: The vast majority of that was restitution. The actual settlement of the criminal matter was only $243.6 million. That is pretty inexpensive, given what they did. And the best part (from management's perspective: The stockholders paid it.

https://www.justice.gov/opa/pr/boeing-charged-737-max-fraud-conspiracy-and-agrees-pay-over-25-billion

Seriously.....watch the film. "Downfall." I think it is on Netflix. From the moment the flaps re retracted and MCAS was automatically turned on with a single, non-functional and non-redundant Angle of Attack sensor, the pilot would have about ten seconds to figure out what to do. None of them were trained on this. Boeing actively concealed the existence of the system and refused to train pilots on its use. Even when the training was requested.

I recently rode in a 737 and a a330 both behind the wings.
The Airbus was a smoother and quieter ride imo. There were a couple times I thought the engines quit.
The Boeing flap operation created a loud rattling buzz throughout the cockpit while the Airbus was completely silent.

From what I recall, it never went below $200m. "Cost plus" contracting - ain't it great? Bringing a management style developed to take advantage of that to the commercial sector is what killed them.

In Boeing's case, the former MD management staff brought this to its extreme. They padded the bottom line by selling off assets, like entire manufacturing plants. A company can only "make money" and keep its stock prices up for so long like this, until it simply runs out of properties to sell, and then can no longer manufacture the components it needs. And yes, this was all under MD management, after they had destroyed MD in precisely the same manner.

Regarding ISS...this was mid-90s. Boeing was the lead integrator on ISS. I was working for McDonnell Douglas on the Spacelab program (managed by NASA out of Marshall Space Flight Center). Boeing on was also at MSFC (and the Jetplex). Boeing had lost some critical Space Station equipment (lost it) - and the ensuing investigations shone such a bad light on them in HSV, they were given a zero award fee on their contract (very rare in those days). The merger took place right during that timeframe and the head of our Spacelab program was moved into position as the head of the Boeing ISS contract as a result.

After we merged, all of the McDonnell Douglas personnel in HSV were moved out to the Boeing Jetplex facilities, so I worked elbow-to-elbow with legacy Boeing folks for the next 10 years or so.

Geez Mike, what an embarrassing cluster fark. Not surprising, though. It always seemed to me that Boeing sent all of their real "winners" to the government programs. Veritable "island of misfit toys (engineers)". I think that was driven by the nature of the way in which they were compensated by the customer - all government contracts were "guaranteed", also known as "cost plus". In other words, it didn't really matter how much was spent, compensation was a guaranteed amount above whatever that was. The commercial side, of course, didn't have that luxury. The commercial side very much had to perform, in a very competitive market, and against a competitor - Airbus - who had the luxury of significant backing from member nation's governments.

The management practices developed under this "cost plus" model eventually crept into the commercial side at MD. They were firmly entrenched, and had caused MD to fail by the time of the merger. Post merger, those practices replaced the decades old, tried and true (although not very profitable for the "stakeholders") practices employed by Boeing.

I'm retried Boeing Corporate IT.
When the company instituted software engineering standards in 05, we formed a corporate IT group called SEPG (Software Engineering Process Group)
Defense Systems and Shared Services group adopted the standards.
When we tried to get BCAG to join, they said they didn't need software standards, the rest is history.
Other parts of the company tried to save BCAG from themselves, but it was all for naught.

The pilot near the end said it best … They completely changed a major system and basically didn’t tell anybody. That pi$$es me off just as much as I currently fly a Boeing…. Boeing should have just updated the B757…. Everybody loves that airplane and companies STILL want them.!

While I have never worked a contract with Boeing I have negotiated Research and Development, Low Rate Initial and Full Rate Production contracts with Bell, LMCO and Sikorsky. I am not a contracting officer and was either the PM or Lead of the negotiation team.

Some of what you wrote above is accurate while other sections, not so much in my experience. I am not arguing that this did not happen at Boeing, it would just not have followed the FAR guidance on contract types.

"Cost Plus" contracts are typically used in R&D contracts and LRIP contracts. Profit on those contracts is capped, generally around 8 to 10%. This is because the government is willing to accept the risk in R&D and LRIP. The reason for that is often the requirements are not well understood by the government, especially in sensors and avionics, and many companies will not accept the risk of a firm fixed price contract in the early stages of development.

I am working through this right now with a contract to design ork on fuel cells in UAS: The government wants FFP, we need cost plus because they have no idea what they really want.

FRP contracts are mostly Firm Fixed Price for what is known as the "Fly Away Price"...also commonly refered to as the "above the Line Price".

FFP contracts are also capped on profit. Where companies make money is in the "below the line" items (the list is long), in G&A and government directed engineering change proposals. Also, constructive changes to the contract are huge profit centers.

I could go on about "forward pricing rate agreements", contract incentives, etc...if any anyone suffers from insomnia, PM me and I will continue. You'll be asleep in minutes:cool:

Again, great thread. I had no idea.

I was hoping this was going to be one of those videos where they add funny caption translations to Hitler's bunker episode.

Edit: Not sure where you were going with this on the Boeing thread, so I deleted the video.

Best.

Sea.

Thanks, Paul for chiming in and providing some experienced insight into how these contracts work, and the differences between them. I have no experience in that arena. I'm just passing on what us poor dumb engineers thought we "knew" about all of it. It's obviously more complex than I understand. What we did pick up on, what was absolutely unmistakeable, was the manner in which we were allowed to approach things in our jobs. After the merger, it was very much no longer the "playground" into which I hired, with no one worrying about, nor accountable, for cost. After the merger, that was the only thing that mattered.

I remember one day in particular, post merger, when a bunch of us were attending some training class (we layer began to euphemistically refer to these as "reeducation camps"). The instructor at the front of the room asked the class "what is the Boeing Company in business to do?"

"Make airplanes!!!!" was the jubilant reply from all of us kids in the sandbox. High fives all the way around, "boy, this is going to be easy", etc...

Stern silence, and "that" look from the teacher at the front of the room... "Wrong. The Boeing Company is in business to make money."

It was on that day that we all knew we were doomed...

It's fun to hear these stories from the legacy Boeing side as "the rest of us" watched our heritage be unceremoniously cast aside. I bet the old Rockwell guys cringed when they saw statements like "the Boeing-built Space Shuttles" or the McDonnell Douglas guys when the Blue Angels were flying "Boeing F/A-18s".

No, we all started using Boeing processes and procedures (BAC5009? - wasn't that the fastener installation spec?). The only reeducation I saw was to do things "the Boeing way". ;)

Please, Jeff: If you are a "poor dumb engineer" I'm a sock puppet.

What Boeing did on the military side with the F-18, with a complicit government group, was pretty much genius at the time and is still studied at the Defense Acquisition University, where I have been a guest speaker a number of times.

The genius was once they got the original F-18 in the fleet, got the Navy a "little bit pregnant", subsequent versions of the F-18, including a nearly entire new design with the E/F, were contracted under the "engineering change proposal" clause in the contract...no competition, same rate structure, no detailed contract review, etc.

Again, everyone would nap better than Sleeping Beauty if I went into the details, but they are spectacular from a PM perspective.

Not that we're very cost focused even today - the lore here is that, Oppenheimer's succeeding director, Norris Bradbury would go to congress every year and basically say "this is what we did last year, if you give us more we'll do this stuff too" and he backed it up every year. That was about the level of fed program management for us in Los Alamos early in the cold war.

We did awesome stuff! Crazy things. Stupid things. Nucular rockets!

Now we do primavera schedules and powerpoint. Not exactly progress in my mind...

As a former Rockwell/Rocketdyne guy, I used to remind the legacy Boeing folks all the time that they couldn't build anything that goes faster than the speed of sound :D

My Rockwell technical fellowship program disappeared with the merger. :mad:
Mention that management concept to a MAC/DAC person and they get a funny look. :rolleyes:

I would like to hear about that actually. I am very surprised to hear that an ECP was the contract vehicle for the E/F.

Saw the Boeing doc and was riveted.

Here is another great aviation documentary that shows our government is not always on the up & up too. https://www.vandornmovie.com/

This is a great conversation, guys. I love hearing all of the widely varying perspectives on all that happened. Of course us legacy Boeing guys blame MD, MD guys blame Boeing, legacy Douglass guys blamed McDonnell. Loyalties are great, aren't they? None of us will ever have a clear perspective. All of this happened way, way above our pay grades, and much of it was hidden by a lot of guys motivated to hide it.

I think what is most clear, to all of us, is that none of the companies for whom we worked (or still work) are what they once were. They have all lost something over the course of the last couple of decades. The truly pioneering spirit, the real "gee wiz" nature that attracted guys like me is a thing of the past. What a shame...

Alas, there is hope. My oldest son followed me into the profession. He is working for a very small engineering house in Seattle (almost entirely Boeing expats). They are getting contracts from Blue Origin, NASA, Space X, and others. He is working with, for, and around people who are seriously talking about going back to the moon. And he gets to help them do it. There are still dreamers out there, real pioneers, guys willing to risk their fortunes gained elsewhere - the aviation pioneers of old. You just won't find them at Boeing anymore, nor any other corporate conglomerate. My son was lucky enough to find them. I'm happy for him.

Just about everything in that movie is true, and they sugar coated some parts of it. When I heft last year it was a dumpster fire internally, only the true believers were still defending management,