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Is he Boeing’s subsequent CEO?

Jul 9, 2024 | blog

Good morning.

When interviewing Alan Mulally, it’s clear he has a ardour for each the science of constructing merchandise and the artwork of managing folks. Before his eight-year run as CEO of Ford, Mulally was CEO of Boeing Commercial Airplanes from 1998 to 2006. A celebrated chief in each jobs, he was an aerospace engineer who’d constructed his profession in a tradition that trusted its engineers, a tradition that began to erode after Boeing’s merger with McDonnell Douglas. He left Boeing after being handed over for Jim McNerney as CEO.

I point out Mulally as a result of Boeing wants not only a new chief however a brand new management strategy. It’s now pleading responsible to fraud prices over the lethal 737 Max crashes. CEO Dave Calhoun, together with predecessors Dennis Muilenburg and McNerney, has been criticized for being a numbers man who paid extra consideration to shareholders and inventory worth than staff and security. For a fuller historical past, try Shawn Tully’s cowl story earlier this yr.

At 78, Mulally isn’t prone to be the following CEO of Boeing, an organization that might take a number of years to show round. Instead, keep watch over Spirit AeroMethods CEO Pat Shanahan, an aerospace veteran and former performing protection secretary whom Shawn recognized as a high contender months in the past. Boeing’s $4.7 billion acquisition of Spirit Aero, a significant Boeing provider, places Shanahan in a good stronger pole place. (It ought to be famous that Spirit has contributed to Boeing’s high quality gaffes, together with the door-plug blowout, issues Shanahan was employed to repair.)

The query isn’t just who takes the job, however when. Calhoun introduced in March that he’ll step down on the finish of the yr. That’s a protracted goodbye for a pacesetter who’s been CEO of a deeply troubled firm since January 2020 and on its board since 2009. As Calhoun stated after Muilenberg’s ouster: “Boards are invested in CEOs until they’re not.”

Bill George, a management skilled and former Medtronic CEO, argues “the Boeing board needs to stop treading water under Dave Calhoun and appoint a transformative leader like Pat.” That would enable them to concentrate on rebuilding Boeing for the longer term.

Having by no means met Shanahan, I requested some recruiters and business insiders what he’s like. What got here again is an image of a fiercely aggressive technocrat who’s not afraid to bruise egos and drill all the way down to the smallest particulars to get issues achieved. Not for nothing was he referred to as “Mr. Fix-It.” Along with a willingness to step on toes, although, Shanahan must construct belief with an sad workforce, as effectively regulators, suppliers, buyers and a disgruntled public. It’s not clear that he needs such a high-profile position.

But Boeing is clearly getting a robust chief in its newest acquisition. Headhunter Peter Crist, who’s spent a long time assessing leaders within the industrial house, believes that Shanahan is the frontrunner. He notes that it’s not unusual to see “companies buying other companies with the intent of acquiring talent at the CEO level.” Shanahan is an apparent catch. As Crist places it: “Now that you have him, what are you going to do with him?”

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Diane Brady
diane.brady@fortune.com
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This story was initially featured on Fortune.com

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