PARIS – Amid competitive hurdles, Boeing is looking to streamline. The company’s defense chief shared the thought process.
You recently announced a reorgization of the defense group. What are the goals of that decision?
[This was part of] a three-part strategy. Last November we announced the consolidation of our sites. That was truly an affordability play; an opportunity to make sure we’re doing the right work at the right place and bring Boeing Defense together. Second was the announcement of the move to Washington D.C. for our headquarters. Also clearly a statement, and it was purposeful. And finally the [reorganization] announcement [is focused] all around agility. We want to keep up not only with the speed of technology but also the speed of decision-making required. Less layers allows us to do that. We flattened the organization, so those focused markets report directly to me and we have clear line of site across all of them.
You’ve said it wasn’t any particular program that drove the decision, but Boeing has had some high-profile losses lately. Can this improve Boeing’s competitive position?
It will certainly play in. We’ve had one of our production lines. 2016 was a banner year. But those big franchise wins have been elusive. And I like winning. Part of this is the speed by which we advance new products, be innovative, respond to customers, be listening. My goal is a year from now, two years from now, when folks look back at what we did, they’re going to say we made the right decision and it resulted in more wins.
The Air Force decided to award to L-3 as the integrator the Compass Call recapitalization program. Boeing decided to protest. Why was a protest worthwhile?
I don’t want to do anything that causes the customer to slow down in processes or be harmed, [and I don’t want Boeing to] get in the way of their urgent operational needs. At the same time, I want to make sure they’re getting the full story in terms of the value equation. I believe the 737 offers a compelling story in terms of size, weight, power pooling, opportunities for growth in the future. We felt there was opportunity there, that the story had not been fully told. That was the basis behind the protest.
If the protest is denied and the award moves forward, what does that mean for Boeing’s strategy to militarize commercial aircraft?
There is a large market – more than 100 aircraft – that are up for recapitalization. We believe we have not only a great aircraft by which we can do the integration on, but the power at the Boeing company to do integration and help these customers meet those significant mission needs. It’s not going to change our strategy in the least. We just want to make sure it’s a fair fight. I’m all for competition; competition is good. I just want to make sure the playing field is level.
The Air Force has expressed concern about the protest environment, and indicated that they might consider penalties for protests that are not sustained. What are your thoughts on that?
We very rarely do protests. When we make those decisions it’s done thoughtfully. We don’t enter into frivolous protests to begin with. It’s something we take seriously. We don’t want to hamper their process just for the sake of hampering it. We wouldn’t do it if we didn’t feel there was a concern.