Leadership change

Scott Carson is all the good things people have always said about him.

He’s hard-working, he’s driven, he’s passionate about our business. He has a great sense of the history of Boeing – his father worked here before him.

He absolutely loves this company.

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Scott Carson walking the 737 wing line last month in Renton.

What you may not know about Scott, however, is that he’s willing to go a little “out of the box” to get a deal done. Years ago when I was the Boeing sales director for Northwest Airlines, we had the CFO for Northwest in town. And since Scott was then our CFO, I thought the two guys would enjoy getting together. So I invited Scott to dinner along with my boss, the head of North America Sales at the time, John Feren.

We got to the dinner a bit early, and before my boss got there, the two CFO’s were chatting about the 757-300, the airplane we were trying to place at Northwest. During the discussion, Scott had an interesting proposition for his airline counterpart. I was a bit surprised by it, but as it turned out it was a great way to get Northwest interested in the airplane.

A very short time later my boss John Feren arrived. After John sat down, Scott, with a little bit of a grin on his face, said, “Geez John, I just wanted to share what we were chatting about.” And as he told John his proposal, I remember that John was so taken aback, he lurched forward, hit his water glass and spilled the water in his lap!

What was it that Scott suggested? A “try it, you’ll like it” arrangement. Take a couple of airplanes on lease. Operate them for a short period of time and see how they work in Northwest’s system.

The great thing was, while we never did make the lease part work, the offer really got Northwest interested in the 757-300. They evaluated the airplane and eventually bought a bunch of them.

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Scott Carson relaxing in his office.

So, as our CEO Jim McNerney told employees, Scott Carson will be missed, but he leaves Commercial Airplanes “with a reinvigorated, customer-focused sales team, record levels of backlog, lean and efficient production lines, and an operating engine that has driven - and will continue to drive - solid results, even in these tough times for the commercial aviation industry.”

Jim Albaugh will now lead Commercial Airplanes, and taking over Jim’s role at Integrated Defense Systems will be Dennis Muilenburg. As Jim McNerney pointed out, Albaugh brings program management expertise and a deep engineering background. He has experience integrating technically complex programs, and he’s also familiar with the issues and concerns of Boeing employees here in the Puget Sound region.

These leadership changes signal an important period of transition during a critical time for our industry. And of course, it’s an especially vital period for Boeing, as we move toward upcoming challenges in the competition for the U.S. Air Force tanker and in flying and delivering the 787 and 747-8 later this year.

Comments (11)

Chris C (South Africa):

Scott Carson is certainly a Boeing-man through and through. His deep understanding, knowledge and passion for the Boeing Company is clearly evident. However, after reading about Jim Albaugh and reading his message to the BCA team, I firmly believe Boeing has the “right-stuff” in the leadership position of BCA for the next few years.

In Jim Albaugh’s message to the BCA team, he clearly states that “in its soul, Boeing has always been and remains an engineering company. As an engineer I look forward to learning from and working with you. The heart of this company is the skilled machinists, technicians and mechanics - true craftsmen and wizards - who deliver on their promises everyday. I look forward to understanding what you believe can be done to make the company even better still.” In my views, I’d like to think that Albaugh is going to emulate the great qualities of the venerable former BCA boss, Alan Mulally. From my humble position, I wish Scott Carson all the best in his retirement and Jim Albaugh all the very best as he leads BCA to forever new frontiers.

ht young (stl):

I sent an email to Scott Carson recommending he find a better word than "impact" as a descriptor. I've had to do this with most of our current senior management. Scott responded, agreed, and the best I can tell, stopped using "impact". Simple but leaders that learn are vital.

James Robinson (Long Beach CA):

My impression is Scott Carson is retiring in order to show investors Boeing is doing something to address the 787 development delays. I think this is unfortunate as my opinion is Scott Carson came into his current leadership role after all the decisions which doomed the 787 to all the current development headaches had been made.

I would be really curious to know who made the decision not to better manage and support the suppliers during the scheduled development period between the inception of the program and roll-out?

I honestly think since about six months after roll-out Boeing has made the correct decisions and has moved towards managing the program the way they should have from the beginning. Unfortunately, the bad decisions early in the program did not bear fruit until more recently.

Lore Hilby (Puget Sound):

Thanks Randy for the personal touch. It is nice to know that sometimes our execs like to work a little outside the box to make a customer happy. We all wish Scott only the best with whatever he decides to do with his retirement.

Conrad Roseburg:

Say thanks to Scott Carson for the great job he has done and great leadership he has shown.

Thanks Scott.

Ron Bresher (Everett, Washington):

What is your take on the negative press on the recent leadership change? The press has been saying that Scott Carson was asked to leave due to the 787 delays. True Boeing has taken a hard beating by the press and the shareholders, but I hope we are on a true path to recovery.

I think Jim Albaugh will do fine as the CEO of BCA. His background in defense and their programs with their level of complexity should be a benefit to BCA on all of our pursuits in the future. I do not possess a crystal ball. I do hope that as a company we continue to do better & better in our commitments to our customers and in winning new Contracts and Airplane orders.

I believe that we can rise above and accomplish great things as a Commercial Airplane Company if we all just hang together. Benjamin Franklin once was quoted as telling his Compatriots at a session of the Continental Congress : Brethren we must all hang together on this (The Revolution), or we shall all surely hang separately!

Whether it is the 747-8, 787-9 /10, 737 replacement, or the KC-X Aerial Refueling Tanker I believe as a team we can do what it takes to win and regain some of our reputation in these tough times.

GP (Renton):

I agree with Robinson's post: the timing of Carson's 'retirement' seems unfortunate. His retirement after 787 First Flight would have been a better time, a more logical time to transition from development to production with a new leader. Stockholders didn't seem to like the timing either.

I also think that the issue of supplier responsibility, in areas typically reserved to BCA (design & qualification), needs to be thoroughly examined. BCA should conduct 'after-action' reviews for both 787 & 747-8 programs, so that we can determined what worked & what didn't, and which suppliers are capable of higher responsibility and which are not. As I infer from Robinson's comments, BCA program management can't easily fix situations where a supplier is assigned responsibilities it is not capable of meeting.

Finding this balance (between BCA & supplier design responsibility) should be a key strategic objective.

Paulo M (Johannesburg, RSA):

Scott Carson made a monumental difference to the Boeing Commercial Airplane' backlog. I think most people who watch the industry will recognise him as the man who reinvigorated the BCA sales department.

He got to lead BCA when industry specialist analysts where calling it a day for Boeing's involvement in the commercial jet market. He got out there and sold awesomely engineered 777's to airlines all over this globe in good deals for Boeing and the customers. During Carson's run at the top, BCA had sold on average more higher-priced planes than the it's main rival.

Boeing always had a good proposition for customers. The personal touch you describe with Carson, Northwest and the 757-300's reminds me of another great Boeing gentleman - E.H. 'Tex' Boullioun as he pitched the 767 to TWA over the rival A310 in December 1979. Tex offered to pay penalty costs if the 767 wasn't 35% more efficient than the A310. (Time, August 4, 1997)

Jim Albaugh's note to the employees shows passion for company. I wish him a fruitful time at BCA.

When James McNerney became CEO of Boeing, he spoke of a need to merge/marry the cultures of the legacy Boeing and McDonnell Douglas companies in order to have one great company that could leverage the competitive strengths of its two halves. It's time to close another such glaringly obvious gap at Boeing.

Hopefully Jim Albaugh's leadership at BCA closes the ugly alleged gap between Boeing leadership and the Unions. At a company like Boeing, there should be no place for an 'us versus them' attitude.

Pat (Puget Sound):

I used to work for IDS prior to my coming over to BCA and have to say it is great to have a talented - and smart - manager coming over to fill Scott's shoes. Scott should be credited for selling our airplanes. Now we should make sure we can deliver on our promises to our customers and shareholders.

As an engineer, it fills me with pride to know that there are some managers who "get it" and understand it is the engineers, mechanics, and frontline folks who make the company what it is. I also think it is good to have a man who has worked "East of the Cascades" as there are definitely divisions within the company which must be smashed, so we can share knowledge and skills.

One example - the composite structures on the 787 are brand new to the BCA folks, but people in IDS have been working with composite structures for decades. Why could we have not transferred the people (if not the technology due to ITAR restrictions) who could have advised on whether our models, approaches, and techniques were going to work?

Such efficiencies are imperative if we are going to face up to determined companies like EADS, and rising challenges from Embraer, China's AVIC, Bombardier, and the stated desires of the "heavies" in Japan.

Kinbin (Taipei Taiwan):

I echo comments made in earlier posts on Carson's contributions to sales and backlog.

However, at the moment, its the execution and the product delivery that is the glaring shortcoming, along with milestone commitments to the market that run shallow time and again.

A reputable engineering leader with the skillsets of managing and driving the team of engineers and mechanics is critical at this stage.

Norman (Long Beach, California, United States):

I wish Scott Carson all the best in his retirement and thanks for the leadership through the tough years. I wish Jim Albaugh all the success in the Commercial Airplanes.

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