Impact of Unethical Behavior on Boeing's Reputation and Operations

This analysis explores the impact of unethical behavior on Boeing's reputation, revenue, shareholders, and customers. It discusses the two incidents involving Boeing 737 Max flights and the software flaws that caused them. The analysis concludes with recommendations for the company.

Academic and
Professional Skills
1

EXECUTIVE SUMMARY
For every company it is essential to conduct their operations and functions in the ethical
manner so that they can conduct their work properly. Ethics is also considered as moral
philosophy that include several aspects such as systematizing, recommendation and defending
activities related in right or wrong manner. Boring Business is operating their business in airline
sector and they conduct some unethical activities due to which several person get injured and
dead. There are two flights of respective company i.e. Boeing 737 MaxLion Air Flight and
Boeing 737 Max Ethiopian Airlines flight in which software fault are deducted. This will
impacted on respective company stakeholder, reputation, revenue and customers.
2

Table of Contents
EXECUTIVE SUMMARY ............................................................................................................2
INTRODUCTION ..........................................................................................................................4
ANALYSIS .....................................................................................................................................4
Impact of unethical behaviour on Boeing’s reputation and whether the company should be
allowed to continue to operate................................................................................................4
Impact of unethical behaviour on Boeing’s revenue and whether the company should be
allowed to continue to operate................................................................................................5
Impact of unethical behaviour on Boeing’s shareholders and whether the company should be
allowed to continue to operate................................................................................................6
Impact of unethical behaviour on Boeing’s customers and whether the company should be
allowed to continue to operate................................................................................................7
CONCLUSION................................................................................................................................8
RECOMMENDATION...................................................................................................................8
REFRENCES...................................................................................................................................9
3

INTRODUCTION
Ethics is also known as moral philosophy which include systematizing, recommendation
and defending concept related to right or wrong activities. In respect of business ethics is
considered a effective business policies as well as practices which help in regulating operations
and functions effectively (Beard, Schweiger and Surendran, 2019). Ethics for a company will
include several aspects which include corporate governance, bribery, social responsibilities,
insider trading, fiduciary responsibilities and many more. There are different types of business
ethics which are adopted by a company such as personal loyalties, personal responsibility,
official responsibility, technical morality, legal responsibility and so on.
Respective project is based on Boeing Business, according to this in October 2018, there
are 189 people are killed in Boeing 737 Max Lion Air Flight at Indonesia. This is occur because
aircraft get into emergency nose dive as well as it get crashed into sea after landing of 13
minutes. Similar in March 2019, 157 people died when Boeing 737 Max Ethiopian Airlines
flight dived into countryside Addis Ababa. These both accident are blamed on the software flaws
and issues related with the sensor, MACS (Manoeuvring Characteristics Augmentation System)
and specifically (Bowe and Dowson, 2020). These are mainly designed in order to keep flight
stable when malfunctioning as well as pushing the nose of aircraft get down due to overriding
any specific action by pilot. But in this situation, Boeing's Chairman as well as Chief Executive
office refuse to admit that there is any flaws in software and they said pilots didn't follow exact
procedure properly due to which software not work properly.
After sometime The Federal Aviation Administration temporarily banned jets. Due to
which respective company is planning to upgrade their software till the end of summer so that
they can estimate issues of aircraft before 2019. The main aim of conducting this report is to
understand how unethical behaviour of a Boeing business impacted on its different factors i.e.
reputation, revenue, shareholders and customers.
ANALYSIS
Impact of unethical behaviour on Boeing’s reputation and whether the company should be
allowed to continue to operate.
Unethical behaviour is considered as action which conducted and which is illegal for
company. For conducting unethical behaviour an organization avoid all rules, regulations and
4

legislations developed by nation government (Cottrell, 2019). The main motive of conducting
unethical behaviour is to gain more and more profit. In respect of Boeing Business they conduct
unethical practice according to which they conducted unethical behaviour in which they blame to
pilot that it is their fault in case of aircraft diving. But truth is that there is issues in software as
well as in sensor, MACS (Manoeuvring Characteristics Augmentation System) and specifically
of Boeing 737 Max Lion Air Flight and Boeing 737 Max Ethiopian Airlines. This unethical
behaviour impact on respective company reputation as their brand value and goodwill get
decreased. This is generally do so because The Federal Aviation Administration banned
respective company on temporarily basis as well as they also found that there is major issues in
in software, sensor system as well as in wings.
These all parts are are essential at the time of taking off plane. So when customer know
that these all issues are in Boeing Business's two aircraft i.e. Boeing 737 Max Lion Air Flight
and Boeing 737 Max Ethiopian Airlines then their trust get broke and they feel cheated which
directly impacted on their reputation at the potential marketplace (Guraya and Chen, 2019). But
now Boeing Business is planning to upgrade their software by the end of summer so that they
can come back in operation before 2019 finish, so it can be say that they should allow to
continue their operations. Moreover this is so because through respective company understand
their mistake and they are conducting practices in order to overcome it, so it will be effective to
provide chance to company.
Impact of unethical behaviour on Boeing’s revenue and whether the company should be allowed
to continue to operate.
Revenue is considered as total amount of income which is generated by a company
through the sales of goods or services. It is considered as top line because it stated at the top of
the income statement. Revenue is determined as a number which is generated through income
before expenses are taken out from statement. If a company conduct unethical activities or
behaviour then result will also directly or indirectly impact on their revenue because their sales
get decreased (Leal-Rodriguez and Albort-Morant, 2019). This is also generally happen because
company goodwill get decrease from its potential marketplace. In respect of Boeing Business,
they are conducting their business operations in airline industry and while conducting business
they get engaged in some unethical activities or behaviour due to which their sales goodwill as
well as market value get decreased.
5

Moreover it conducting unethical behaviour also impact on the sales of respective
company which directly leads to decrease in firm's revenue or profitability ratio. This will also
show that how lies which respective company tell to everyone impact on their profit or revenue
because trust of stakeholders, client and customers get broken (Mahanal and et. al., 2019). Along
with this, The Federal Aviation Administration also temporarily banned respective company
which also impact on their sales and revenue generation. Furthermore, now Boeing Business is
planning to upgrade their software in order to conduct their operations again before the end of
year 2019, so after that company can continue their operations at the potential marketplace. This
is so because they feel their mistake as well as they also conduct operations or practices in order
to resolve issues in software and various different parts of flights (Roberts, 2019). Moreover by
getting a chance to conduct business operations and functions again in respective industry
Boeing Business need to conduct several practices like conduct advertisement at high rate,
developing trust among client, stakeholder and customers and many more. This is so because
through it they able to generate high revenue again at the potential marketplace.
Impact of unethical behaviour on Boeing’s shareholders and whether the company should be
allowed to continue to operate
Shareholder refers to individual or institution which legally owned one or more shares of
stock in private or public corporation. It may be referred to members of a corporations.
Stakeholder generally provide financial backing to the firm so that they can conduct their work
in effective and efficient manner. There are different types of Shareholder such as directors,
managers, individuals, employees, institutional investors, communities, governments,
communities and many others (Hubscher-Davidson, 2019). There are several benefits gain by a
company from Shareholder such as they get effective source of financing, help in operations,
provide governance to company, control over company and many more. In respect of Boeing
Business, they are operating their business functions and practices at the airlines industry but
during conducting activities they go through some unethical practices due to which their market
value get decreased.
Along with this, it will also impacted on numbers and belief of Shareholder because no
Shareholder want to invest in that firm which is conducting unethical practices as that will also
impacted on their market value (Rosly and et. al., 2019). Boeing’s business shareholders are
trusted on them that they are conduct ethical as well as effective practices but after getting news
6

of engaging in unethical activities trust and belief of Shareholder get broke. This will also
impacted on the respective company operations at the international level. But after sometime
company seniors realise their mistakes and they are planning to update software of both flights
i.e. Boeing 737 Max Lion Air Flight and Boeing 737 Max Ethiopian Airlines (Pohekar, 2019).
So it can be considered that respective company can continue to conduct their operations because
they are taking initiatives to improve their operations. In addition to this, respective airlines is
also improving all software and related system through which they can insure safety and security
of potential customers as well as by providing chance to firm, Shareholder also able to increase
their market value.
Impact of unethical behaviour on Boeing’s customers and whether the company should be
allowed to continue to operate
Customers is considered as recipient of services, products, goods or idea which are
obtained from a vendor, seller or suppliers through a financial transactions or exchange of
valuable considerations or money, this is considered in term of sales, economics and commerce.
In simple manner customers are individuals who buys products or services from a particular shop
(MurrayandCousens, 2020). Customers are of four types i.e. price buyers, relationship buyers,
poker player buyers and value buyers. For every company customers are most important factor
and for them it is essential to provide products or services according to their need, demand and
expectations. In respect of Boeing’s business they operating business in airlines sectors in which
it is essential to provide services according to customers or travellers. This is so because if
company will not do so it will directly impacted on their business as customers move or switch
to competitive companies. In case of respective firm they conduct some unethical practices due
to which their two flights i.e. Boeing 737 Max Lion Air Flight and Boeing 737 Max Ethiopian
Airlines get crashed and several passengers get injured as well as death.
Due to this unethical practices company loss trust of customers towards them which will
leads to decrease in sales of their flight tickets as well as it will also impacted on the profitability
of the company (Ho Tiu and et. al., 2019). Due to reaction and unethical practice of company
The Federal Aviation Administration has temporarily banned the Boeing’s Business. But now
respective company management realise their mistake and take decision to upgrade their
operations as well as system by improving their software and flight system. This will help them
in ensuring that all the activities or operations will conducted properly as well as ethically. So it
7

can be say customers must provide chance to the Boeing’s business so that they continue their
operations in the airline industry properly, ethically and successfully.
CONCLUSION
By above discussed point it can be conclude or summarise that for every firm it is
essential to conduct all business practices and functions in ethical manner. It is also essential for
them to develop policies, rules and regulations according to the government legislations because
it help in ensuring that all practices are conducted ethically. Along with this it is also necessary
to avoid unethical practices because it will directly or indirectly impact on the several aspects of
business. That will include reputation, revenue, shareholders and customers as well as these all
aspects are totally connected to the business revenue and profitability ratio. Moreover, for an
organization it is also essential to develop strict rules as well as regulating so that all employees
and employees follow it properly. This is so because it will help them in ensuring whole business
operations as well as functions are conducted effective and successful manner.
RECOMMENDATION
By analysing all the situation or case of Boeing’s Business, it can be analyse that
company senior authority conduct some unethical practices which impacted on their business
operations and functions. Moreover, it will also impacted through several aspects such as
reputation, revenue, shareholders and customers. So there are various recommendation or
suggestion for respective company which help them in improving their operations, from which
some are mentioned below:-
 It is essential for senior authority of Boeing’s Business to conduct their business
operations and functions in ethical manner according to legalisation developed by
government bodies.
 Company must also apologize with their customers or passengers who get suffered in the
incident of Boeing 737 Max Lion Air Flight and Boeing 737 Max Ethiopian Airlines.
Moreover they also provide compensation to the passengers and their family in order to
regain trust.
 Respective company senior authority must also hire experts in order to check and ensure
working condition of all flights software and related system. This is also because it help
them in rebuilding trust of customers, stakeholder and investors in successful way.
8

REFRENCES
Books and Journals
Beard, D., Schweiger, D. and Surendran, K., 2019. Integrating soft skills assessment through
university, college, and programmatic efforts at an AACSB accredited
institution. Journal of Information Systems Education. 19(2). p.11.
Bowe, D. and Dowson, P., 2020. International Experiences.
Cottrell, S., 2019. The study skills handbook. Macmillan International Higher Education.
Guraya, S. Y. and Chen, S., 2019. The impact and effectiveness of faculty development program
in fostering the faculty’s knowledge, skills, and professional competence: A systematic
review and meta-analysis. Saudi journal of biological sciences. 26(4). pp.688-697.
Ho Tiu, C. P. S. P. and et. al., 2019. An art‐based visual literacy training course to enhance
clinical skills in dermatology trainees. Journal of the European Academy of
Dermatology and Venereology. 33(9). pp.e310-e312.
Hubscher-Davidson, S., 2019. Emotional Intelligence and professional translation.
Leal-Rodriguez, A. L. and Albort-Morant, G., 2019. Promoting innovative experiential learning
practices to improve academic performance: Empirical evidence from a Spanish
Business School. Journal of Innovation & Knowledge. 4(2). pp.97-103.
Mahanal, S. and et. al., 2019. RICOSRE: A Learning Model to Develop Critical Thinking Skills
for Students with Different Academic Abilities. International Journal of
Instruction. 12(2). pp.417-434.
Murray, J. and Cousens, D., 2020. Primary school children’s beliefs associating extra-curricular
provision with non-cognitive skills and academic achievement. Education 3-13. 48(1).
pp.37-53.
Pohekar, P. D., 2019. SOFT SKILLS: ARE THEY EXISTED IN PUBLIC
ADMINISTRATION?. Paripex-Indian Journal Of Research. 8(9).
Roberts, D. L., 2019. Mentoring in the academic library. College & research libraries
news. 47(2). pp.117-119.
Rosly, R. N. R. and et. al., 2019. MALAYSIAN TVET LECTURER AND INDUSTRIAL
TRAINING THROUGH NATIONAL OCCUPATIONAL STANDARD
SKILLS. Humanities & Social Sciences Reviews. 7(2). pp.212-219.
9