Boeing Business Report 2022

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Boeing Business
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EXECUTIVE SUMMARY
In the year 2018, 189 people were killed in a Boeing 737 Max Lion Air flight crash
followed by another similar incident in the year 2019 where 157 lost their lives, and the main
issues for the crash were due to a software default that was not made aware to the pilot flying
the aircraft. Such software was introduced for the smooth functioning of the sensors of the
aircraft, but due to the lack of training, this accident occurred that resulted in the loss of life
of so many people. This primary focus of this report is to understand the fact that such
airlines shall be made operational as it was evident that the crash occurred due to the lack of
awareness of the pilot about the new software. This report further aims at understanding the
unethical behaviour of Boeing’s reputation and the fact that it should continue its operation or
not.
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Table of Contents
EXECUTIVE SUMMARY........................................................................................................1
INTRODUCTION......................................................................................................................3
ANALYSIS................................................................................................................................3
Technical Factors..................................................................................................................4
Ethical and Moral Issues.......................................................................................................5
Fundamental Canon..............................................................................................................5
Informed Assent....................................................................................................................5
Precautionary Principle.........................................................................................................6
Leadership Issues..................................................................................................................6
FAA (Government Body Issues)...........................................................................................7
CONCLUSION..........................................................................................................................7
RECOMMENDATION.............................................................................................................8
Reconstruct the company policies.........................................................................................8
Investing more money for the development of new technologies........................................8
Reforms in the Management.................................................................................................9
REFERENCES.........................................................................................................................10
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INTRODUCTION
The word ethics is taken from the Latin word “ ethos” that defines the fundamental
ethical and moral values of the society. Business ethics regulate the conduct that dictates to
go beyond the legislative provisions and follow that would be morally and ethically right.
Boeing is one of the leading companies in aviation, considered a leader in industrial and
delivering aircraft globally, with customers in over 100 countries and employees in over 65.
In October 2018, Boeing model 737 max of Lion Air, soon after departure from Indonesia,
plunged into the Java Sea, homicide nearly 189 passengers on board (Fischer and Dov 2014).
Five months later, in March 2019, the same model aircraft of Ethiopian Airlines, nosedived in
the countryside, just outside the capital Addis Ababa, causing the death of 157 people. Both
accidents caused the tragic deaths of 346 people. As a result, the blame fell on software issues
and mainly on the faulty Manoeuvring Characteristics Augmentation System (MCAS), which
original design was to keep the aeroplane stable in take off but instead malfunctioned and
pushed its nose down, overriding any actions taken by the pilots Further, the Federal Aviation
Administration has banned the jets temporarily (Nytimes.com 2020). Boeing planned to
upgrade their software by the end of summer and stated that they would be back in the
process before the end of summer. The primary issues that this report focuses upon are the
ethical and the moral concerns of the Company about putting the business first then the safety
of the people. It further focuses upon the fact of whether Boeing should continue its operation
or end them.
ANALYSIS
The key focus of this report is to analyze the main key factors that resulted in two
fatal crashes of Boeing 737 MAX in the year 2018-2019 that resulted in 346 fatalities. The
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main question was that whether Boeing being a significant airline should remain in business.
It begins with considering the technical errors behind the catastrophes that will lead to an
analysis of the more profound unethical behaviour of the Company, along with the evaluation
of the associated governing and the regulatory bodies.
Technical Factors
Numerous studies and investigation were actioned soon after the two deadly crashes
of Boeing 737 MAX to establish the relevant technical and human errors. The plant's security
systems and how they were settled, are the centre of the aerospace giant’s unfolding crisis.
Firstly, Boeing was considered building on all modern plane in 2011 (Miller, Danny and
Xiaowei 2018). However, beneath the excessive weight from its rival, Airbus, Boeing chose
to overhaul the 737 insteps. The choice demonstrated to be pivotal. Being outlined it required
to fly more distant and more effectively than past 737s. In order to achieve that it prepared a
max with more significant engines, placed much higher on the wings of the aircraft, which
required to change the plane’s aerodynamics entirely. To balance the hazard of a stall, Boeing
further created MCAS ( Maneuvering Characteristics Augmentation System), that pushed the
plane down in a few circumstances in order to make the flying machines stable.
Unfortunately, in both the fatal crashes MCAS software malfunctioned within minutes before
the take-off and despite the Many attempts, the aeroplanes kept going into plummeting.
According to the pilots flying the 737 not only received the official training on the
installation of the new software but also declared that many were unaware of the action.
Boeing Co is recommended to place all the pilots of the pivotal 737 max to go back to the
simulator training. A stunning revelation shows that the opposite of their first actions towards
adequate training (Miller, Danny and Xiaowei 2018). In most recent reports there is
Manyevidence of further deepening technical problems for the Boeing 737 and its
deficiencies which run beyond software issues, with further wiring and tank debris problems.
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Therefore, an ex-manager Ed Pierson of Boeing recommends factory to be shut down “after
seeing chaos” with 13 other safety incidents in the aeroplane’s short lifespan.
Ethical and Moral Issues
The tragedies resulted in losing the lives of 346 passengers and crew. As per the data,
the two planes specify that corrupt manufacturing observes and astoundingly modest design
errors backed to both disasters. “The Boeing 737 MAX 8 only newly went into service, in
May 2017 (Contributor, 2020). Without a doubt, the dilemma of ethical and moral issues rose
immediately as to where the profit was put above the safety and wellbeing of Boeing
passengers”.
Fundamental Canon
According to The National Society of Professional Engineers (NSPE) Code of Ethics,
the well-being, welfare and the health of the people shall be set as the priority. According to
initial outcomes from the ongoing investigations, both tragedies were instigated by a single
faulty sensor, that activated a new automatic anti-stall system to push the plane’s nose down
repeatedly. Several reporters have stated that Boeing just accused of comparatively cheap and
straightforward cautioning shows in the cockpit that aware pilots to divergent sensor readings
(Grace and Cohen 2014). If such exhibits had been installed on the two 737 MAX 8s that
crashed, it is more likely that pilots would have been able to identify the faulty anti-stall
system. There has been a limit regarding the amount of money aircraft
manufacturers spend to make their products more safe to use, but that
was not the consideration in the case.
Informed Assent
Pilots were not well-versed that the new version of the 737 MAX 8 model had been
furnished with the different involuntary anti-stall system, nor that a faulty reading of a single
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sensor could trigger it. Pilots were not educated about the new versions of the 737 Max
model of the aircraft that equipped a new anti-stall system that the pilot was completely
unaware. Pilots were never informed that a single faulty reading of the sensor could activate
the software as the pilots were not adequately trained to operate such software (Todd et al.
2014). This is the apparent violation of the principle of informed consent as the pilots were
unaware about the software that could have saved the lives of the people as the passenger’s
safety in a flight solely depend upon the pilot. This ethical requirement can be understood as
a submission of the principle of informed consent.
Precautionary Principle
The third ethical principle included the precautionary principle that was violated in
the case. As per the probable origination of the precautionary principle, the engineers of the
software were responsible for safeguarding against the threats that occurred. The authorities
of the Company were not disclosing the reason for the crash initially (Peterson 2019). It was
evident if two planes had crashed that resulted in losing the lives of so many people; hence it
was the responsibility of the authorities to address the malfunctions and disclose it. The two
crashes were due to the same reason that shows even after the first crash, the authorities were
not responsible enough to train the other (Grace and Cohen 2014). These clearly showed that
the motive of the Company is profit inducing and was not concerned with the safety of the
people at all. The second crash changed the situation enough to warrant upon a strict action
on the Company even if it did not blame their software for the crashes. There was a lack of
moral and ethical behaviour of the Company towards the public.
Leadership Issues
As per the facts of the case and the circumstances as followed, it was seen that the
crash was due to the lack of leadership guidance of the authorities. The worldwide views on
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this matter are the same as it was true that if the pilots were not appropriately trained the
crashes could have been ignored if they got proper training. Even after the first crash, the
authorities were not severe enough to combat the situation and provide guidance for the
same. Even after two crashes, the authorities were not responsible enough to train and guide
the pilots about the software. Initially, the chairperson of the Company did not even agree to
the fact about the reason for the crash. For that reason, all the countries have opposed the
functioning of such Boeing aircraft.
FAA (Government Body Issues)
Before the fact that the FAA gives the official certification to the flights, Boeing
needed to fix specific points before the final elevation of the aircraft. Additionally, the main
concerns were put up on the jet’s wiring and the issues related to the wiring of the aircraft.
The process would include the FAA pilots to test the software of the aircraft and the analysis
of it that was supposed to take a more extended amount of time. However, the issue was the
uncertainty about the procedure that has to be conducted. After the procedure to be complete
by the FAA The Joint Operations Evaluation Board conduct the stimulator profiles to
examine the human factors and the revised training required to the pilots. After the
completion of the certification process, the final design was to be documented by the FAA.
With all the complete procedure, the FAA would finally issue The Continued Airworthiness
Notification to the International community. The conditions were laid as individual training
programs to be finalized that would ensure safety.
CONCLUSION
In conclusion, it is stated that the crash of the Boeing aircraft was due to the improper
administration of the Company. After the first crash, the approach of the Company should
have changed to train the pilots, but the attempt to make the technological advances helpful to
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regain the trust of the people, despite losing the lives of so many people, they were still
negligent about the training. In a scenario where the pilots were made aware of the usage of
the software, they could have understood the danger about the plane crash. Due to such
software, the crash occurred. So it is evident that the administrative authorities were negligent
enough to provide the proper instructions about the change in the aircraft. The full
responsibility of the safety of the passengers travelling in an aircraft lies upon the pilot and
where the pilot is not aware of such changes in the aircraft they would end up losing their
lives and will also result into the loss of life of the passengers. The FAA was also responsible
as they provided the safety certificate without knowing that the pilots were unaware of the
installation. In such a scenario company like Boeing should not stop its operation instead it
shall employ some more time to make the technologies more advance and enhance the
training of the pilots so that accidents like such can be avoided.
RECOMMENDATION
The recommendations would follow the points where the Company can start its
operation moral and ethical grounds. The following recommendations can be considered in
order to make the Company functional and back to operations:-
1. Reconstruct the company policies.
The Company should focus on policies that will ensure the safety of the passengers.
They should introduce new policies where the safety of the passengers will be of utmost
concern with the help of those policies they might gain the trust of the public.
2. Investing more money for the development of new technologies
New technologies must be introduced in order to make the aviation easy for the pilots.
With the technological enhancements in the countries, the technology that is used in such
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aircraft must be upgraded so that they may ensure the safety of the passengers and make the
pilots and the authorities aware about the dangers before they take off. Such warnings and
disclaimers can save a lot of life and time, but it must be made aware of its usages to the
pilots.
3. Reforms in the Management
The Company needed reforms in the management and required to train their pilots as
they are the people who are responsible for the lives of the passengers in the aircraft. The
crash was an excellent example where the lack of proper management leads to the loss of life
of so many people. So, it must be made mandatory to train the executives and pilots so they
become aware of the usages of such software that can be very helpful if understood. With
such new reforms that will depend upon the ethical conduct of the administration, such
accidents can be lessened in the future.
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REFERENCES
Contributor, B. (2020). The Ethical Failures Behind the Boeing Disasters. [online] Blog of
the APA. Available at: https://blog.apaonline.org/2019/04/08/the-ethical-failures-behind-the-
boeing-disasters/ [Accessed 29 Feb. 2020].
D Black, E Black, T Christensen, K Gee Non-GAAP earnings for contracting and financial
disclosure. Working paper Posted: 2018
Fischer, Dov, (2014) Was Boeing’s Compensation Committee Sufficiently Independent in
Judging the Business Risk of the 737 Max? Available at SSRN:
https://ssrn.com/abstract=3370066 or http://dx.doi.org/10.2139/ssrn.3370066
Grace, D. and Cohen, S. (2014). Business ethics. Australia: Oxford University Press.
Miller, Danny and Xu, Xiaowei (2018). MBA CEOs, Short-Term Management and
Performance.Journal of Business Ethics., Vol. 154.
Nytimes.com (2020). Boeing Refuses to Cooperate With New Inquiry Into Deadly Crash.
[online] Nytimes.com. Available at: https://www.nytimes.com/2020/02/06/business/boeing-
737-inquiry.html [Accessed 29 Feb. 2020].
Peterson, M. (2019). Ethics for engineers. New York: Oxford University Press.
Todd A. Gormley, David A. Matsa, Todd Milbourn (2014). CEO compensation and corporate
risk: Evidence from a natural experiment. Journal of Accounting and Economics, Volume 56,
Issues 2–3
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