16 thoughts on “Boeing And The Dark Age Of American Manufacturing”
I quit paying much attention to business management texts after I got my MBA – but have any serious books been written about the collapse of other US manufacturing titans – Ford, GM, ATT, Kodak, the railroads, etc?
Because the same mistakes are made over, and over, and over again.
That’s an odd mix of companies / industries.
Ford survives making really nice trucks although the government is trying to kill it again by pushing EVs.
GM is a zombie walking but it takes multiple generations of bad management to completely kill a company (see GE and Westinghouse). It would be dead except the government propped it up.
ATT (as a manufacturing company) was killed by the government (see deregulation).
Kodak was dead at the inception of the digital camera. Its competencies were film chemistry and optics whereas digital photography runs on semiconductors and software. It was no more going to remake itself than the manufacturers of buggy whips were. Note also that digital cameras are regressing to a specialty market now that cell phones are equivalent to a DLSR from 10 years ago.
The railroads appear to be doing okay – moving freight. Passengers aren’t coming back.
Boeing – now that would be worth a book. I can’t write it – too much of what I know about Boeing’s downfall is classified. Besides it makes me sad. I still remember my sense of wonder from my first jet flight and my first flight on a 747.
And I don’t think any of these have drawn a book. Most don’t get case studies in MBA programs. I remember during my MBA program in the 80’s Detroit’s problems were blamed on bad marketing…
The Innovator’s Dilemma: When New Technologies Cause Great Firms to Fail (1997 Christensen) and The Innovator’s Solution: Creating and Sustaining Successful Growth (2003 Christensen & Raynor) were serious books that formed a real contribution. As books Dilemma was more data driven, and Solution was more theory focused.
Also The Idea Factory: Bell Labs and the Great Age of American Innovation (2012 Gertner) was a powerful Greek tragedy. AT&T creates Bell Labs, which is amazing and wonderful, invents much of the building block of the computer industry, and invents packet-switched routing and cell phones, all of which enables the replacement of the AT&T phone monopoly, devastating AT&T and the funding for Bell Labs.
I think you are imagining, however, some real tome on “the success of the company made them fat and lazy, which made them incompetent.” For some reason that is not a popular theme for MBAs.
It’s the real business cycle; an entrepreneur builds up something that builds wealth. When he or she leaves someone else takes over; if this person is another entrepreneur, the business grows, (usually), until eventually, the bankers (financial types) take over and cash it out.
Then another entrepreneurial type comes in and rebuilds the wreckage. This is nothing new, nor is it a surprise. Jack Welch coining the term ‘Six Sigma’ did not change anything except a name.
Lather, rinse, repeat….
To be blunt, Boeing is a lost cause at this point. Even if they rediscover engineering, they will soon return to this failure mode.
My take is that what we should be looking at is how these businesses get into this long term failure mode rather than being quickly replaced by something better. Here, there are two problems: first, that it’s extremely risky and expensive to build a new passenger jet anywhere in the developed world with a lot of onerous regulation and liability to take on, and second, that Boeing and Aerojet both get plenty of support from governments that a new contender wouldn’t get.
Boeing was a lost cause the moment that they bought McD (or, as it is often said, that McD bought Boeing with Boeings money).
At that point, somehow, the McD folsk were running the show…and they made Boeing fail the same way that McD did.
It costs from $20-50 billion to take a clean sheet airliner design through certification and to establish production. Not many companies have that kind of money to invest in something that won’t generate any revenue for at least 10 years.
First, $20-50 billion isn’t what it used to be. Second, would it really? NASA and the usual suspects would have said the cost of Starship/Superheavy was infinite. Turns out it was probably less than they’ve spent on the transporter so far, let alone what it will cost before it could transport an actual moon ship.
Right now, the airlines are desperate enough to make many things possible that would have been impossible two or three years ago.
The Left has pretty much outlawed mining and manufacturing in the United States, through the Environmental Protection Act primarily. I don’t know how that can be reversed within our lifetimes…or mine, anyway. I turn 70 in a few days.
They will not show you the content to which they object lest you be shocked and angered by your own past content. Or in case someone happens to be walking by and is struck dead by seeing it on your computer.
Have you Purged it from your mind yet? This whole society needs to be purged of objectionable content. Yes.
I quit paying much attention to business management texts after I got my MBA – but have any serious books been written about the collapse of other US manufacturing titans – Ford, GM, ATT, Kodak, the railroads, etc?
Because the same mistakes are made over, and over, and over again.
Because the same mistakes are made over, and over, and over again.
For you Doc; a Generational Reference.
That’s an odd mix of companies / industries.
Ford survives making really nice trucks although the government is trying to kill it again by pushing EVs.
GM is a zombie walking but it takes multiple generations of bad management to completely kill a company (see GE and Westinghouse). It would be dead except the government propped it up.
ATT (as a manufacturing company) was killed by the government (see deregulation).
Kodak was dead at the inception of the digital camera. Its competencies were film chemistry and optics whereas digital photography runs on semiconductors and software. It was no more going to remake itself than the manufacturers of buggy whips were. Note also that digital cameras are regressing to a specialty market now that cell phones are equivalent to a DLSR from 10 years ago.
The railroads appear to be doing okay – moving freight. Passengers aren’t coming back.
Boeing – now that would be worth a book. I can’t write it – too much of what I know about Boeing’s downfall is classified. Besides it makes me sad. I still remember my sense of wonder from my first jet flight and my first flight on a 747.
And I don’t think any of these have drawn a book. Most don’t get case studies in MBA programs. I remember during my MBA program in the 80’s Detroit’s problems were blamed on bad marketing…
The Innovator’s Dilemma: When New Technologies Cause Great Firms to Fail (1997 Christensen) and The Innovator’s Solution: Creating and Sustaining Successful Growth (2003 Christensen & Raynor) were serious books that formed a real contribution. As books Dilemma was more data driven, and Solution was more theory focused.
Also The Idea Factory: Bell Labs and the Great Age of American Innovation (2012 Gertner) was a powerful Greek tragedy. AT&T creates Bell Labs, which is amazing and wonderful, invents much of the building block of the computer industry, and invents packet-switched routing and cell phones, all of which enables the replacement of the AT&T phone monopoly, devastating AT&T and the funding for Bell Labs.
I think you are imagining, however, some real tome on “the success of the company made them fat and lazy, which made them incompetent.” For some reason that is not a popular theme for MBAs.
It’s the real business cycle; an entrepreneur builds up something that builds wealth. When he or she leaves someone else takes over; if this person is another entrepreneur, the business grows, (usually), until eventually, the bankers (financial types) take over and cash it out.
Then another entrepreneurial type comes in and rebuilds the wreckage. This is nothing new, nor is it a surprise. Jack Welch coining the term ‘Six Sigma’ did not change anything except a name.
Lather, rinse, repeat….
To be blunt, Boeing is a lost cause at this point. Even if they rediscover engineering, they will soon return to this failure mode.
My take is that what we should be looking at is how these businesses get into this long term failure mode rather than being quickly replaced by something better. Here, there are two problems: first, that it’s extremely risky and expensive to build a new passenger jet anywhere in the developed world with a lot of onerous regulation and liability to take on, and second, that Boeing and Aerojet both get plenty of support from governments that a new contender wouldn’t get.
Boeing was a lost cause the moment that they bought McD (or, as it is often said, that McD bought Boeing with Boeings money).
At that point, somehow, the McD folsk were running the show…and they made Boeing fail the same way that McD did.
Maybe there is room for a startup specializing in repairing Boeing aircraft and after they get good at that, they start making their own?
It costs from $20-50 billion to take a clean sheet airliner design through certification and to establish production. Not many companies have that kind of money to invest in something that won’t generate any revenue for at least 10 years.
Then don’t. Just fix what exists.
First, $20-50 billion isn’t what it used to be. Second, would it really? NASA and the usual suspects would have said the cost of Starship/Superheavy was infinite. Turns out it was probably less than they’ve spent on the transporter so far, let alone what it will cost before it could transport an actual moon ship.
Right now, the airlines are desperate enough to make many things possible that would have been impossible two or three years ago.
The Left has pretty much outlawed mining and manufacturing in the United States, through the Environmental Protection Act primarily. I don’t know how that can be reversed within our lifetimes…or mine, anyway. I turn 70 in a few days.
Civilizations have failed for forever. As have nations, large corporations/organizations/other entities (cities/towns/communities, etc.).
What is the common element they all have shared?
In overabundance?
Hmm. A theme emerges.
Well there is this: Starliner to launch astronauts to the ISS on an Atlas 5 on May 6th.
Don’t hold your breath
They will not show you the content to which they object lest you be shocked and angered by your own past content. Or in case someone happens to be walking by and is struck dead by seeing it on your computer.
Have you Purged it from your mind yet? This whole society needs to be purged of objectionable content. Yes.