New Boeing CEO is a hardened corporate crisis manager

Beleaguered Boeing Co is putting its future in the hands of a turnaround veteran who has led several companies in crisis, cut his teeth at engine maker General Electric Co and has spent a decade on the board of the world’s largest planemaker.

Newly appointed Chief Executive David Calhoun, 62, was made Boeing’s chairman two months ago in the midst of the crisis that has rocked the company since airliner disasters in Indonesia and Ethiopia led to the grounding of its best-selling 737 MAX.

This isn’t his first taste of corporate upheaval.

Calhoun became chairman of the Caterpillar Inc board shortly after federal agents raided its headquarters in 2017, headed a General Electric unit that included jet engines after the Sept. 11, 2001 attacks, and turned round media research company Nielsen to go public. He has also been a longtime executive at Blackstone private equity group.

“Having seen him run GE’s aviation business after 9/11, I know he can execute under pressure,” former GE chief executive Jeff Immelt told Reuters by email when asked about Calhoun, adding that Calhoun would restore customer trust in Boeing.

As Calhoun tackles the MAX crisis, he also faces questions from European regulators over a deal to buy the commercial arm of Brazil’s Embraer in a major strategic move.

Calhoun, who has co-written a book on business, “How Companies Win,” says being candid is part of being a leader, an approach which many critics say was absent from Boeing’s initially guarded approach to concerns about the 737 MAX.

“The second you get into the office til the second you leave, every interaction is judged,” he said in a video published in 2014 by the Jack Welch Management Institute.

“You try to hide anything from everybody and I think your body language becomes perfectly apparent.” Yet in his short time as Boeing chairman, Calhoun has showed his ability to force changes behind the scenes, as seen by his role in the departure of Kevin McAllister as chief executive of Boeing’s planemaking arm in October. The removal was silent and swift, foreshadowing Dennis Muilenburg’s ouster this week.

Some insiders saw McAllister - another GE veteran - as a scapegoat for the MAX crisis. Others say he paid the price for distractions including widely publicized cracks in the company’s older 737NG jets, which caught the board off guard. The 737 MAX was not impacted by the cracking issue.

The reckoning came at an informal board dinner in Texas led by Calhoun in late October. As directors wound up a two-day summit a day later, Calhoun and Muilenburg took McAllister aside and told him he was out, two people briefed on the meeting said.

Reuters