'Have You Directly Spoken To Any Of The Whistleblowers?': Ron Johnson Presses Boeing's CEO

6 months ago

At today's Senate Homeland Security Committee hearing, Sen. Ron Johnson (R-WI) grilled Boeing CEO David Calhoun about safety issues.

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Transcript

00:00Thank you Mr. Chairman. Pick up where the chairman just left off. You said you'll

00:04check into that. Did you talk to the individual responsible for complying

00:10with our information requests? Have you had a meeting with that individual or

00:13that group of individuals? Senator Johnson, my team knows and I have talked

00:19to them about the need for transparency at every level and every stage. So

00:23beyond that as a backdrop, no I did not review each line item. So who

00:28would be your direct report responsible for providing this committee the

00:33information, the subcommittee the information you requested? Yeah I'll be

00:36a accommodation of my counsel and my government affairs office. Okay so you'll

00:41talk to them today about this. Yes well they're right behind me and so I'm sure

00:45yes it's registered. You said you've listened to the whistleblowers. Have you

00:50directly spoken to any of the whistleblowers? I have not directly

00:54spoken to any of the whistleblowers. Do you think that'd be a good idea to do

00:58that? Yeah I think it would. I'd recommend it. Yep.

01:08Exactly what are you doing then to investigate the whistleblower

01:11complaints? If you haven't spoken to him directly. Yes sir. Have you just turned

01:16it over to your counsel? We have a team. We have an ethics hotline and a

01:21team of investigators. The most important thing in every whistleblower out of the

01:28chute is to make sure we understand the substantive issue that is being

01:31discussed and do safety analysis immediately and go out and interview

01:36everybody that's involved and or has touched any of that work and assure

01:41ourself that we have safe airplanes and if there are corrective actions to take

01:46with respect to the points that they make with us that's what we do and we

01:50try to get on that immediately but there's always an objective view and a

01:55number of perspectives particularly with respect to engineering disciplines

01:59that have to come to bear on it. So how many employees does Boeing have?

02:02170,000. So having run a much smaller operation I mean first thing I can say is I

02:08realize that I don't control what everybody does. You try and set policies

02:12you can communicate as clearly as possible people are people. The question

02:16I have for you because it's actually quite shocking to have a supervisor

02:19calling somebody up 19 times in one day you know making the statement I'm gonna

02:26break you. My guess is you don't condone that kind of behavior. Have you

02:33looked at your incentive system within Boeing and let's face it there's

02:36obviously pressure on your sales you know from your sales force to your

02:39manufacturing operation to deliver the planes that they've sold to airlines

02:43again there's pressure throughout companies you know and I can just

02:49imagine that the pressure is being applied to Boeing associates throughout

02:53the company okay but I get that I've been in manufacturing but have you

02:59reviewed for example your incentive systems that maybe would drive that kind

03:04of behavior you know having to meet quotas or I mean have you reviewed that?

03:08Yeah this this year we made a number of significant changes to our incentive

03:15structure that really emphasizes all things safety including the running a

03:22just culture with that respect and a just culture I think is the environment

03:27that you would like us to run and so yes that incentive alignment is now in place.

03:34So prior to our last hearing one of the articles I read whether fair or unfair

03:39talked about and your disclosures it's probably the SEC where you were scoring

03:48high on ESG and DEI and your score was zero on your quality these are internal

03:55quality performance measures. Can you speak to that report? That's a fact.

04:02Because the point being is is Boeing's management are they concentrating on DEI

04:06and ESG and at the expense of really meeting your quality performance

04:14measures? Senator I've never seen those two things ever come into conflict. I

04:21don't believe my team has ever allowed for them to come into conflict in any

04:25way. Not necessarily conflict it's what you're emphasizing what were you

04:31putting your your management emphasis? Yes well again Senator there's a comp

04:37system there's also what we work on every day all day knowing how important

04:41and critical it is for the future of our company. Safety and quality is it it's

04:46been that way since January of 2020 because of what we have been responding

04:53to. Safety and quality that is what we talk about. You know I'll mention another

04:59article and the reason I'm doing this is one of the reasons we have a we need a

05:03free press it'd be nice to have a completely unbiased free press but we

05:07need investigative reporting. We only have so much staff here at a subcommittee

05:12level or even a committee level so we really do need journalists going out

05:15there and digging up stories. One of the ones I thought interesting before this

05:18hearing spoke to the the very real problem the difficulty you are having in

05:23finding well first of all your workforce manufacturing workforce is aging. You

05:28know throwing COVID on their early retirements that type thing you lost a

05:31lot of experience and in the past it sounds like Boeing was able to tap into

05:36a workforce that there was had experience in the aerospace industry and

05:43you don't have that luxury anymore. I'm not exactly sure when that changed I

05:47know coming from manufacturing myself it's been difficult to hire people in a

05:50manufacturing operation because let's face we tell our kids gotta get a four

05:54year degree and you want to be in management. So we don't encourage people

05:57who go into manufacturing but can you speak to that issue maybe Mr. McKenzie

06:00can speak to that issue in terms of just your challenges and hiring people in a

06:04manufacturing setting for a very high quality high demand aerospace industry.

06:12Senator Johnson and I appreciate the question more than you know. The post

06:19COVID moment in the aerospace industry has been unbelievably difficult to

06:26navigate. We have 10,000 suppliers we we put almost two and a half million parts

06:33into a 787. Boeing because it's big and it has resources even those were

06:42strained we we were able to keep more than most but like you say we turned

06:46over a lot of people and yes a lot of experienced people. Our supply chain

06:50experienced enormous turnover. So as we try to respond to unbelievable demand

06:58for airplanes out there we have a supply constraint that is very real and it is

07:04not resolved today. And I think one of the most important things we can do

07:09we've done it in a few large instances but now we have to train ourselves to do

07:15it at small instances meaning every employee. If a parts not there on time if

07:20a parts non-conforming we will stop the line. This so much of this relates to an

07:27untrained workforce I it's all about that honestly.

'Have You Directly Spoken To Any Of The Whistleblowers?': Ron Johnson Presses Boeing's CEO

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