Originally Posted by
Intruder
Your description of Douglas/Boeing history is not accurate.
Douglas had its HQ in Long Beach, CA. McDonnell (in St Louis) acquired Douglas. Then in 1997, Boeing and McDonnell-Douglas merged. Initially, HQ was in Seattle, but after Phil Condit left the CEO position, Harry Stonecipher (previously of McD-D). he engineered the move of HQ to Chicago.
IMO, Boeing's decline started when Bob Woodard was VP and President of the Commercial Airplanes Group. He decided to compete with Airbus for market share, using price as incentive. It resulted in a HUGE financial loss for Boeing in 1997 that took years to recover. It also resulted in the big layoffs of 1998, of which I was one victim.
Since the move to Chicago, I believe HQ has become detached from company operations, and beancounters have taken over from the old engineers that previously rose through the ranks. The resulting focus on quarterly profits likely fed some of the corner-cutting...
Actually your history is off as well. Phil Condit moved the headquarters to Chicago long before he stepped down as CEO (the joke among those of us who knew Condit - and of his womanizing - was that he'd run out of women in Seattle and needed new hunting grounds). Condit was the worst thing that ever happened to Boeing - basically he was a shining example of the Peter Principle in action (you get promoted to your level of incompetence). Condit's buying spree of other companies lost billions (there was one satellite company that Condit bought for over $1 Billion, and within a year they had to write it's value down to about $500 million). All this finally culminated with the MacDac merger - the adoption of MacDac management practices of outsourcing everything lead directly to the fiasco of the 787.
BTW, it wasn't the prices that lead to those huge loses in Commercial in '98, it was the rapid increase in production rate -much faster than what the various vendors could support. That lead to massive parts shortages, aircraft rolling out missing major components, expensive rework when the late arrive parts finally showed up, and finally a complete shutdown of new production for (IIRC) six weeks while they tried to get everything caught back up.
If they had promoted Alan Mulally to CEO instead of Condit, Boeing would be a far different (and better) company today.