The problem of design for incumbents
Boeing have been in the news lately for all the wrong reasons.
The incident that befell Alaska Airlines Flight 1282, a Boeing 737 Max, on 5th January would have been terrifying for passengers. Ultimately nobody was seriously hurt and the aircraft landed safely, but the damage to Boeing’s fortunes and reputation have been significant, with the FAA grounding 171 of their planes for inspection, cancelling thousands of flights.
It’s been interesting over the past week to consider the fragility of an airlines’ business model but also, specifically, to look at the history of the world’d best selling aircraft and what its design can teach us about the power and pitfalls of being an industry incumbent.
The world’s workhorse
The Boeing 737 is the world’s best-selling aircraft, but it’s the one facing all the issues of late. The 737 is about 20 years older than the Airbus A320, its direct competitor, and it was the release of the new, more fuel-efficient A320 in the late ‘80s that took Boeing somewhat by surprise, having previously considered the 737 to be without a serious competitor.
Around the time of the release of the A320, Boeing had been considering whether to build a next-generation single-aisle plane. However, given the surprising success of the A320, they concluded that they couldn’t afford to lose the market entirely to Airbus during the development cycle for this new model. So they decided to try to improve the efficiency of the 737 without a full redesign, and do so by adding new, larger engines. Thus, the 737-Max was born.
This “middle ground” approach had its advantages. Because it’s just a variation of the existing model, the new 737-Max didn’t require lengthy re-certification from the FAA and airlines didn’t need to undergo extensive pilot training. However, by putting larger engines under the existing plane design, it changed the flying characteristics. This is what led, in part, to crashes in 2018 and 2019, and it’s one of the sources of the issues that the airline is facing today.
The problem of incremental change
The 737’s evolution is a lesson on the limits of incrementally tweaking designs. By being incremental, you can save time in the short run, but there is a danger you compromise on quality. Of course, the stakes for airlines are higher, but the principles can be applied to any product.
Boeing had various plans for a completely redesigned single-aisle workhorse made of composite materials and fly-by-wire tech (much like its 787 Dreamliner). However, the pressure to keep revenues high in the short term and not give away too much market share to rivals, such as Airbus, forced this project (called Project Yellowstone) to be continually mothballed.
Whilst it’s likely they will remain focused on improving the quality and sales of the 737 in the short term, the safety issues from 2018 to today will likely increase pressure on Boeing to re-launch Project Yellowstone. In the end, they may find that they should have endured some short term pain (mainly for shareholders) for long term gain years ago. Indeed, many industry observers point to a shift in Boeing’s culture from being “engineering-first” to being “finance-first” that ultimately led to these issues.
The naivety and agility of youth
The Boeing saga is a good example of complex engineering projects, and how design decisions can have repercussions that persist for years, even decades. It’s also an illustration of how new companies, who have the ability to start “from scratch,” can leapfrog established, better-funded incumbents. Regardless of the reputation and resources of the incumbent, legacy engineering decisions may have backed them, and their products, into a corner that they can’t get out of.
An example of this was the ascent of Zoom. Before it became a household name during the pandemic, it was a startup trying to break into video conferencing, a sector long dominated by incumbents such as Cisco, Webex and others. One could have asked why start a video-conferencing company when the problem had already, largely, been solved? But by attacking the problem fresh, and without the hangover of legacy engineering decisions, Zoom was able to build a lighter, more sophisticated product, and went on to dominate the market.
The aircraft industry is so capital-intensive that it’s unlikely that Boeing or Airbus will face any competition from a Zoom-style startup anytime soon. However, Boeing might take their recent travails as a sign that the age of the 737 could be at an end, and it could be time for a new design, inspired by the faster, more agile examples that we see in so many other sectors and industries.