What Can Small Business Owners Learn from the Monumental Mistakes Made by Boeing  

In January 2024, an Alaska Airlines flight carrying 177 people made an emergency landing shortly following takeoff from Portland, Oregon. The reason? The plane had left the runway with a side panel that was missing bolts. When it blew off mid-flight, it left a gaping hole in the side of the jet. Fortunately for everyone involved, no one was hurt. 

Fifteen years or so ago, I opened the driver’s door of my Chevy Blazer, and it literally fell to the ground. The pins holding the door at the bottom had rusted out, and nothing held it in place except the latch. Fortunately for me, unlike the plane flying over Oregon, my car was not moving. 

A few weeks later (because I live in the Detroit area and know a lot of automotive employees), I asked a couple of GM engineers how the door on a car that was less than five years old could just fall off. They both shrugged their shoulders and said, “Yeah, those door pins have been rusting out for years. It’s a big problem.” I stared at them and followed up with the obvious question. 

“If you guys knew about this, why didn’t you fix it?” Their response was, “we would have, but not enough people complained.” That was the end of the conversation, and they walked away. 

That explanation was similar to what Boeing has been telling people for decades: “Yeah, well, we know it’s an issue. Nothing to see here. No one has grounded us yet.” If you think a panel falling off a Boeing-made 737 Max was “one of those once-in-a-lifetime occurrences,” you haven’t been paying attention. 

Two massive accidents involving the same plane killed 189 people in a Lion Air crash in Indonesia in 2018 and another 157 onboard an Ethiopian Airlines Max in 2019. Those crashes led to an 18-month investigation by a U.S. House of Representatives panel that found that Boeing had failed in its design and development of the Max and was not being transparent with the FAA. 

However, for whatever reason, the FAA lifted a grounding order on the 737 Max a month later. The plane later experienced electrical issues that grounded dozens of planes in 2021, and in 2023. The FAA again urged airlines to inspect newer 737 Max airplanes for possible loose bolts in the rudder control system. 

This year’s Alaska Airlines flight door and panel disappearance over Oregon was met with the following response from Boeing CEO David Calhoun. At a Boeing staff-wide safety meeting, he called the incident “a mistake.” Calhoun has since resigned, and not only has the Board allowed him to finish the year while they look for his successor, he’ll add to the $32.8 million (a 45% increase over 2022) he made last year with a parting gift of $45 million in stock awards and options. Calhoun has apparently set new heightened standards for failing upwards. 

So, what can a small business learn from the mistakes of a behemoth company like Boeing? Quite a lot. Let’s point out a couple of things that can be applied immediately.

Don’t Emphasize Profits over Quality and Safety

Earlier this year, Boeing shareholders filed a lawsuit against the company’s Board of Directors, claiming they had neglected their oversight duty and failed to hold the company accountable for safety before and after the 2018 and 2019 crashes. The shareholders’ suit claimed, “safety was no longer a subject of Board discussion, and there was no mechanism within Boeing by which safety concerns respecting the 737 MAX were elevated to the Board or any Board committee.”  There was good reason for their conclusion, but the shareholders also reaped the financial benefits of the company’s misguided priorities. 

I know it appears that I’m unapologetically harsh on Boeing, but it’s a public trust, and they literally have our lives in their hands.  

According to an article in Business Insider, Boeing “relentlessly disgorged cash to shareholders when it could’ve spent it on building a better (and safer) product. Investments that could’ve benefited employees, communities, and other corporate stakeholders were often sacrificed at the altar of efficiency and free cash flow. Boeing focused on pleasing Wall Street because that’s how American executives believe companies should operate.”

If you’re a typical small business owner, you are undoubtedly cash-strapped and eager to make a profit on your investment. But when that attention to revenue draws you away from your core principles—including providing good service, making a quality product and paying attention to quality control—you can not only hurt your reputation but you could actually ultimately hurt your bottom line.   

You may not be a public company that has shareholders to make happy, but you have the opportunity to provide quality and competence in the public square and with your clients. That should be the objective of any sized company. 

Admit Your Mistakes

Let’s face it. We screw up all the time and it sometimes affects our employees, our product or service and our clients and customers.  Just admit it and make changes.  This is something so simple, yet Boeing had some major problems with it. A number of organizations looking into why Boeing did nothing about its 737 Max issues attributed it to what they referred to as “normalcy bias.” 

Normalcy bias is a cognitive disposition that causes our brains to assume things will keep going as they always have been on a normal keel, resulting in drastically underestimating the impact if something goes wrong again. It’s a bias because when a tragic event occurs, the first instinct is to deny reality instead of dealing with it. When things go wrong in your business or you make a mistake with a client, it’s always better to acknowledge your error, be transparent and FIX IT. 

Surround Yourself with People Who Understand Your Business

Many of Boeing’s decisions were not made by engineers and aviation experts but by former government officials. Four of its Board members named in the shareholder lawsuit were in professional positions (government) unrelated to the industry, including a former Ambassador to the U.N. (Nikki Haley) and a former White House Chief of Staff (William Daley).  

While it’s sometimes easier to bring in a financial or operations partner to your organization who has skill sets you may not have, if they don’t fully understand your industry or product, they may end up, like Boeing, steering you in a direction that’s only based on short-sighted revenue gains. Make sure your decision makers understand why you do what you do and support the product or service you provide, not just peer over your bank statements (that’s what accountants are for). 

In summary, we can all learn from corporate blunders, but how we apply those lessons is the key to success or failure for any business.