Quality Issues Cause Boeing’s 737 Max Inventory Glut

January 5, 2020
Quality Issues Cause Boeing’s 737 Max Inventory Glut

Boeing has decided to halt production temporarily of its 737 Max airplanes.

Since the crashes earlier in the year, Boeing has continued to produce planes in anticipation of approval by the Federal Aviation Administration for the plane to fly again.  Instead, orders have all but ceased for the plane and over 400 aircraft are already sitting as finished goods at Boeing.

Boeing decided to shut down production temporarily, given excess inventory in stock.  However, Boeing plans to shift its focus to delivering the planes in inventory.  Boeing seeks to minimize long term impact on production and suppliers with this temporary halt.

Video Spotlight:

This post is based on the CNN article, Boeing is halting production of the embattled 737 Max starting in January, by Clare Duffy, December 17, 2019, and the YouTube videos listed in the Video Spotlight. Image source: Monty Rakusen/Getty Images

Discussion Questions:

1. Research the Boeing 737 Max on the web.  What happened to this plane?  Was it a poor quality management program that failed to catch the defects?  Was it a poor training for pilots?  Was it a poor manufacturing process?  Was it a combination of issues?

Guidance: A complex product such as the 737 Max likely had years of serious management attention before the problem(s) manifested themselves fully.  Or were there issues that management did not address given internal pressures within Boeing to go ahead with this plane?  Students should discuss their web findings.  The goal here is to get students to see that quality, product design, manufacturing processes, etc. all play an integrated role, especially when trying to determine the root cause issues with the 737 Max.

2. If pilot training is important, what could Boeing have done to better prepare pilots around the world for this new aircraft?

Guidance: After student discussion, another question is suggested as a follow up: When is it important to include training with new product delivery?  While training may be the responsibility of the airline, it appears that in this case Boeing would have benefited by conducting training for each airline that purchased aircraft.  Students may recognize that mandatory training by Boeing could have been part of the contract for each airline purchasing the 737 Max.

3. Risk management at Boeing should have identified ways to mitigate risk.  Do you think Boeing had a good risk mitigation strategy if the 737 Max failed after product delivery?

Guidance: Students should review risk management.  Have them describe risk mitigation strategies that Boeing should have developed before production of the 737 Max.


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