The Boeing Company
Boeing is one of the biggest corporations in the aerospace industry. The company works with customers across over 150 countries (Boeing, n.d.). Boeing operates through the development, manufacturing, and maintenance of commercial planes, space systems, and defense products (Boeing, n.d.). The core values of the company include safety, quality, and integrity. However, the ethical behavior of the company in relation to the flaws in their latest technology-supporting planes disproves such organizational culture.
The company claims to be dedicated to leading the market with sustainability, inventing for the future, and fostering a culture built on honesty, quality, and safety (Boeing, n.d.).
Boeing made a number of modifications to the well-known 737-800 plane and used software to address flaws (Spielman et al.,2020). They opted not to provide any information about the new software to any of the airlines they sold to since they believed it would not have an influence on the pilots flying their aircraft (Spielman et al.,2020).
The Ethical Issue
In the past, Airbus and Boeing have frequently competed by introducing new aircraft in the same model year that make claims about traveling farther while using less fuel or carrying more weight (Spielman et al.,2020).
The Airbus-neo (New Engine Option) with increased fuel economy was introduced by Airbus (Spielman et al.,2020). Boeing was compelled by the statement to act swiftly or risk missing out on a 35 billion-dollar market opportunity (Spielman et al.,2020). The Boeing 737-MAX airplane model was revealed nine months after the Airbus-NEO design (Spielman et al.,2020). However, after the sales of the new model, two crashes in October 2018 (Lion Air, in Indonesia) and January 2019 (Ethiopian Airlines, in Ethiopia), 400 aircraft of the company were grounded (Cusumano, 2021).
The investigation by Federal Aviation Administration concluded the fault to be in the computerized flight-control system called Maneuvering Characteristics Augmentation System (MCAS) (Cusumano, 2021).
Explanations for the Crashes
It is possible to underline several factors that led to the development of the ethical predicament.
- Design issues in the new flight control software system for the MAX intended to avoid stalling (Herkert et al., 2020)
- Internal pressure to stay up with its main competitor Airbus led to the raw development of new aircraft (Herkert et al., 2020)
- Lack of disclosure and transparency by Boeing on the new software updates (Herkert et al., 2020)
- The FAA’s insufficient oversight of Boeing, particularly during the certification of new models and after the first incident (Herkert et al., 2020)
- Pilots were not obliged to complete 737 MAX simulation training after the first incident (Herkert et al., 2020)
The MAX models have an increased risk of losing lift due to the bigger engines and their new nacelles (Konert, 2019).
The Choice Made
The company chose to admit its failure but only after the crashes. Initially, instead of accepting responsibility for a design flaw in its aircraft, Boeing blamed pilot error (Hall & Goelz, 2019). Boeing claimed that the flight simulators did not replicate the flying circumstances prior to Lion Air and Ethiopian Airlines crashes (Italiano, 2019). The company did not share the timing of their understanding of the faultiness of the flight simulations.
The company was charged with a Fraud Conspiracy felony. According to U.S. Attorney Erin Nealy Cox for the Northern District of Texas, “The misleading statements, half-truths, and omissions communicated by Boeing employees to the FAA impeded the government’s ability to ensure the safety of the flying public” (U.S. Government, 2021). Nevertheless, the decision to conceal critical information about the adjustments claimed the lives of 346 passengers who died in the two crashes.
Egoism
The ethical framework that is illustrated by this case is egoism. Egoism supports self above anything else and may cause destructive behavior in human society. The prioritization of self is not erroneous but should remain within reasonable limits that are not clearly defined by the framework. Cooperation and mutual support could be undervalued as companies may strive to push their agenda above their clients. This could result in the market collapse from the uncontrollable business presence or empower monopolies in the market.
Boeing’s Egoism
Boeing did not disclose the information about updates assumingly because it would have incurred high costs for the company. If Boeing disclosed that there were software updates that were not tested by pilots on the flight simulators, it would have damaged the company’s reputation. Boeing would have needed to retrain numerous pilots to ensure safety. The procedure would have delayed the deployment of new aircraft. Heavy losses would follow due to the overpowering presence of Airbus and associated expenditures.
It is clear in the company’s interest to overpower its competitors and secure market advantage instead of establishing mutual cooperation to achieve sustainability goals and public satisfaction. The company, guided by the principles of egoism, is threatening the peace of society and endangering human lives. This business approach could result in a dangerous predicament in the market. The reason is that Boeing may want to secure a monopolistic position in which society highly values purely the services of this company.
The Choice Not Made
FAA could have enforced a more critical assessment of the aircraft. The company could have disclosed this during the initial phases of new models’ deployment about the software updates. Then it would have been possible to ensure proper training for pilots to avoid crashes. The increasing human factor in the underdeveloped piloting software.
MCAS was triggered by a flawed Angle-of-Attack Sensor, which measures the local airstream. Boeing claims that the MCAS is only operational in manual flying mode and is inactive when using the autopilot (Johnston & Harris, 2019). MCAS adjusts the trim without informing the pilots (Johnston & Harris, 2019).
It is especially important in these situations for pilots to obtain clear paperwork and pertinent training so they can correctly manage the hand-off with an automated system (Johnston & Harris, 2019). A pilot noticing erroneous readings could have performed a cross-check with other readings (Johnston & Harris, 2019). This process could also be automated with additional sensors.
Virtue Ethics
A proper way to respond to the situation would have been made via Virtue Ethics. This framework in the business context implies empowering employees and establishing clear communication lines on every level of company management. In other words, following virtue ethics, the company should empower employees to voice any concerns and establish clear modes for the safe delivery of any inconsistencies. In addition, this upholds the building of a morally good company, the representatives of which fully disclose any issues that are relevant to the operation of its businesses and core product that affects human lives.
Boeing’s Virtue Ethics
Based on the principles of Virtue, Boeing should have adjusted its operations to better suit the environment and customers. Namely, promote intrinsic good and moral character within its employees. Every employee should be accountable for any issues and the possibility of their emergence. In this case, Boeing engineers should have tested their product by trying to consider every hypothetical situation in relation to practical flights. The counterintuitive feature of new aircraft should have been clearly addressed and documented. At the same time, the company’s management should not have pressured their employees to deliver an underdeveloped product design.
The idea is that accountability is difficult to assign in the face of collective action, especially in a computerized society.
Therefore, it should be an inherent quality that people, organizations, and governmental entities should act based on principles of virtue that promote the public good.
The management is similarly accountable for their poor support of employees and for establishing rushed goals without accountability towards safety measures by focusing on pure performance.
Legal Issue
The company faced numerous trials based on the investigations that determined the company’s fault in the two plane crashes. The Fraud Section and the U.S. Attorney’s Office for the Northern District of Texas signed a Deferred Prosecution Agreement with The Boeing Company (“Boeing”) in January 2021. A criminal accusation of conspiring to cheat the Federal Aviation Administration’s Aircraft Examination Group (FAA AEG) in relation to their evaluation of Boeing’s 737 MAX airplane. Boeing acknowledged in court filings that it tricked the FAA AEG by using two of its 737 MAX Flight Technical Pilots.
FAA AEG assessed and prescribed the pilot-training standards for American-based airlines using the 737 MAX. However, the issue of the speed range in which the Maneuvering Characteristics Augmentation System (“MCAS”), a component of the 737 MAX flying controls, might function persisted without notifying FAA AEG.
As part of the DPA, Boeing consented to pay approximately $2.5 billion in total criminal fines. It consists of a $243.6 million criminal fine and $1.77 billion in compensation for Boeing’s 737 MAX airline customers. The heirs, families, and legal beneficiaries of the 346 people who perished in the two Boeing 737 MAX disasters will also get compensation from a $500 million fund.
Lessons Learnt
The main objective of local governments, as well as regional and global economies, is to achieve sustainable economic growth. In order for an organization to be successful over the long term and produce profits, this article contends that business ethics are the most crucial factor. The example of Boeing company demonstrates it is essential to follow morally good decisions that reflect the complete trust and honesty of the company toward customers. Businesses have the ability to significantly benefit society by generating goods and services, creating jobs, collecting taxes, and serving as a catalyst for economic growth. The question of “how, or even if, this contribution is made” raises critical ethical questions that are central to the social function of business in modern society.
This is also the ultimate goal of corporate enterprises.
Decisions and actions that promote sustainability may be significantly influenced favorably by ethical leaders and staff. It follows that everyone in the modern workplace is expected to act ethically. Companies face numerous difficulties in securing competitive advantage as expectations are growing exponentially. It is anticipated that corporate ethics can help organizations better recognize and comprehend these issues so they can uphold these ethical standards. Strong ethical ideals, rather than just financial success, should motivate an organization. Modern corporations operate under enormous pressure from the competition.
The expectations that are made on businesses to behave ethically by their many stakeholders are constantly getting more difficult and complex. Consequently, it is possible to expect that the company is willing to follow an egoism ethical course until the benefits of a more virtuous approach outweigh the potential risks of unethical behavior.
Key Points
The key takeaway is obvious that companies should follow a different approach to profit. Namely, the focus on profit as the goal of the organization should be discouraged. Instead, an approach that considers profits as the outcome of high-quality services should be prioritized.
Employees in various fields have been discouraged from voicing their concerns and complaints due to the lack of proper communication lines. The importance of communication lines in every organization that would like to promote essential development goals is unprecedented.
Top managers of multinational corporations are trying to nurture their employees to follow organizational culture. However, it is evident that culture should be established by the top management. In other. Words senior management employees should demonstrate the behavior and conduct which emphasizes organizational culture and values such as integrity, quality, and safety.
Recommendations
Boeing should rebuild its internal structure to allow more transparent and direct control of its core engineering and management outcomes. The company requires to build an organizational culture that empowers its supposed core values of integrity, safety, and quality. The company should not make rushed decisions due to the high stakes pertaining to the aircraft manufacturing business. The company needs direct lines of communication between different layers of the organizational structure. This way, concerned employees would be able to effectively voice their complaints.
The company would benefit from improved modes of communication in a manner that will improve quality control and swift decision-making processes. Moreover, improved quality control will contribute to the empowerment of the brand image and create a trusting relationship in the market.
Corporations and various associated organizations should enforce ethical behavior. Most importantly, engineers may need to be reminded to prioritize the public interest, particularly the safety of the public. Engineers should act based on the Software Engineering Code of Ethics. A separate act for the company conduct that would be universally addressed could be similarly helpful in the mitigation of the global situation.
Boeing and similar companies should enforce their code of conduct on employees and themselves to strengthen the community as a whole. The market would definitely benefit from such development due to the application of holistic and virtuous approaches to business, which improve brand image and ensure quality control.
References
Boeing. (n.d.). General information: Boeing in brief. Boeing. Web.
Cusumano, M. A. (2020). Boeing’s 737 MAX: A failure of management, not just technology. Communications of the ACM, 64(1), 22-25.
Hall, J., & Goelz, P. (2019). The Boeing 737 MAX Crisis Is a Leadership Failure. The New York Times. Web.
Herkert, J., Borenstein, J., & Miller, K. (2020). The Boeing 737 MAX: Lessons for engineering ethics. Science and Engineering Ethics, 26(6), 2957-2974. Web.
Italiano, L. (2019). Boeing acknowledges flaw in 737 MAX flight simulators. New York Post. Web.
Johnston, P., & Harris, R. (2019). The Boeing 737 MAX saga: lessons for software organizations. Software Quality Professional, 21(3), 4-12.
Konert, A. (2019). Aviation accidents involving Boeing 737 MAX: Legal consequences. Ius Novum, 13(3), 119-133,
Spielman, Z., & Blanc, K. L. (2020). Boeing 737 Max: Expectation of human capability in highly automated systems. In International Conference on Applied Human Factors and Ergonomics (pp. 64-70). Springer. Web.
U.S. Government. (2021). Boeing charged with 737 max fraud conspiracy and agrees to pay over $2.5 billion. The United States Department of Justice. Web.
Virtue ethics. (2022). Ethics Unwrapped. Web.
Westacott, E. (2019). What is ethical egoism? ThoughtCo. Web.