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Organizational Failures at Boeing: A Case Study of the 737 MAX Crisis
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Abstract
This paper looks at the organizational problems at Boeing that contributed to the 737 MAX
crisis, which claimed 346 lives in two airplane accidents. The investigation shows that
leadership, company culture, and risk management were designed to maximize profits and
compete while downplaying passenger safety. With the help of organizational culture theory,
agency theory, and ethical decision-making models, the research explores how Boeing's internal
structure, bonuses to managers, and secrecy in engineering led to its problems. The company's
culture did not support whistleblowers, some regulations were lacking, and the design of its
systems was insufficient, adding to the crisis. It shows that prioritizing short-term advantages
may lead to unfortunate outcomes later. The piece also looks at reform from a personal and
religious perspective, encouraging those in charge to be ethical, open about matters, and
accountable. The report provides valuable insights on how businesses address responsibility,
ethics, and building trust in industries with significant risks.
Keywords: Boeing, leadership failure, corporate culture, risk management, ethics,
accountability, safety.
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Introduction
The crashes of two Boeing 737 MAX planes in 2018 and 2019, which killed 346 people,
exposed major weaknesses inside one of the biggest aerospace companies (Braga da Costa
Campos, 2025). Following the decision to ground the MAX worldwide, Boeing's reputation, the
trust of its customers, and its financial situation suffered a lot. The crisis was caused by errors in
leadership, a toxic company culture, and insufficient risk control. The reasons for these instances
were the same organizational issues that kept putting profits and the competition with other
companies ahead of safety and clear communication. This paper uses objective evidence and
research to analyze the main issues within Boeing organizations that played a role in the Boeing
737 MAX accident. Applying some current theories and ethics in business and biblical
principles, the study discusses how the company's internal choices did not ensure that
passengers, employees, and global stakeholders were treated as they should have been. The goal
is to study these failures extensively and develop constructive strategies for change that follow
ethical principles and reflect professional and religious values.
Organizational Problems Identified
Leadership Failures
Many have noted that Boeing's leadership emphasizes profits and competing in the
market over ensuring the safety of the 737 MAX. There is evidence that former CEO Dennis
Muilenburg did not correctly manage the 737 MAX crisis and was not transparent (Welch,
2021). The board of directors was blamed for not holding the leadership accountable. Pressured
by Airbus's efficient A320neo, Boeing rushed the launch of the 737 MAX, which led to
important design choices that reduced safety. MCAS played a crucial role in causing the
controversy because it is a software that automatically tries to keep the airplane from stalling by
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pointing its nose downward. Nevertheless, the MCAS is connected to two fatal crashes, Lion Air
Flight 610 in October 2018 and Ethiopian Airlines Flight 302 in March 2019, in which 346
people lost their lives (Braga da Costa Campos, 2025). Although MCAS was very important,
pilots were not fully notified and were not provided with sufficient training. Immediately after
the first accident, the FAA determined that MCAS could lead to fifteen more crashes with
fatalities without addressing the issue. In the end, internal messages were found where Boeing
employees stood behind the regulators and admitted to lying to the airlines. As a result of these
choices, Boeing's position as a respected manufacturer became threatened, leading to a
worldwide safety.
Cultural Shortcomings
Silencing open communication and safety issues within Boeing was an important part of
the 737 MAX crisis. Eventually, the company's primary emphasis switched from engineering to
how much money it made and the value for shareholders. The result of this transformation meant
employees felt uncomfortable voicing safety issues for fear of punishment. It was revealed
through several reports and communications that pressure to complete work by tight deadlines
and under budget often made it difficult for staff to do all necessary safety checks and keep the
conversation open. Boeing's leadership promoted silence and obedience, breaking apart the
company's reliable review systems (Jong & Broekman, 2021). Shortcomings in the company's
culture were widely apparent in its dealings with the Maneuvering Characteristics Augmentation
System (MCAS), mainly because significant safety concerns were not revealed to the public or
employees. The lack of attention to these problems led to two deadly crashes and the grounding
of aircraft worldwide. It demonstrates the risks of putting gains ahead of safety and ethics, so
aerospace and other high-risk areas must revise their culture.
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Inadequate Risk Management
The 737 MAX crisis was mainly caused by Boeing's poor risk management, especially
regarding the Maneuvering Characteristics Augmentation System (MCAS). The implementation
of>a single angle-of-attack sensor and lack of redundancy in>flight-critical systems>showed>a
disregard for established safety protocols. As a result of this flaw, two massive crashes occurred.
Besides, the company's self-evaluation of risks did not include all the potential hazards for the
system. This problem was increased by delegating responsibilities from the FAA to Boeing
through the Organization Designation Authorization (ODA) program (Collings et al., 2022).
Because Boeing had a bigger say in such matters, there was a risk that it would want to complete
the reviews swiftly and cheaply, rather than ensuring the utmost safety. This means significant
problems with how Boeing manages its engineering and dealings with regulators. It is shown that
risk assessment programs and safeguards against conflicts of interest should be made stronger
when public safety is involved.
Theoretical Analysis
In order to fully understand why the Boeing 737 MAX crisis happened, it is important to
study the situation through the main theoretical approaches. Organizational Culture Theory,
Agency Theory, and Ethical Decision- Making Models made it possible to see the reasons for the
disaster, both in corporate actions and thinking. They show what made it possible for executives
to break company values, change their motivations, and misbehave.
Organizational Culture Theory
According to Edgar Schein, organizational culture has three defined levels in the
Organizational Culture Theory (Sindakis et al., 2024). Artifacts, stated values, and the
assumptions teams assume. You can see the artifacts in Boeing, such as the safety protocols, how
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they train their staff, and the engineering they follow. California's health companies state their
company values, which include commitments to excellent service, new ideas, and keeping their
customers safe. What is usually called an assumption is a deeply rooted belief that impacts our
actions, usually without our realizing it. Although Boeing portrayed safety as one of its main
priorities (espoused value), the real system showed otherwise. They made engineering and
transparency compromises because they had to fast-track deliveries, fight with Airbus's A320neo,
and keep their stock prices high. Profitability and speed mattered more to these assumptions than
in-depth testing and telling users everything. When workers mentioned software or production
worries, they got either no response or were encouraged not to worry, separating safety values
from the actions leaders were supporting. Details about the MCAS system for pilots were wrong
and missing important parts when documented. Also, there was not enough information in the
training, so flight crews were unsure how to deal with the MCAS when it failed. The pressure to
keep quiet and act fast resulted in less feedback and reduced the accountability of everyone in the
bank. The need to compete made Boeing's culture focus on risk, leading it to surpass its safety
commitments.
Agency Theory
Agency theory points out that agents (executives and managers) can use their power to
benefit themselves even at the expense of those who hired them (shareholders) (Squires &
Elnahla, 2020). It is common for short-term actions by a manager to be less valuable to
shareholders in the long run. Top leaders at Boeing were heavily pushed to get the 737 MAX
ready for delivery, since this would help cover important airline orders and calm investors.
Performance bonuses for managers were awarded based on how much they boosted the
company's costs and profits, the time taken to produce, and stock quotes. Because they were
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focused on near-term success, executives did not address safety issues that might have postponed
getting the plane certified and delivered. While strengthening brand trust and public safety are
objectives that also help shareholders, executives favored cutting costs by not requiring more
training for MAX pilots. Instead of being equipped with angle-of-attack sensor alerts, the
airplane was designed only to fit the sensors if the buyer paid for them. Because these decisions
were primarily based on how managers were evaluated, the company faced significant expenses,
hurt its reputation, and lost investors after fatal crashes. Instead, according to agency theory,
these systems and methods did not ensure that Boeing's leadership acted in the best interest of
shareholders and the public. Because the board and regulators did not oversee or guide them
closely, executives chose actions that looked rewarding now but damaged the business over time.
Ethical Decision-Making Models
Examining the issues at Boeing through utilitarianism and deontology gives more details
about the company’s mistakes. According to utilitarianism, we should make decisions that
benefit everyone. Deontology is concerned with following rules, duties, and principles, not
paying attention to the outcomes (Feess et al., 2022). Using the utilitarian approach, Boeing's
actions did not achieve the greatest good. The lack of complete details about the MCAS system,
less training for pilots, and counting only on a single sensor for such an important task resulted in
two airplane crashes, leading to all Boeing 737 MAX planes being grounded worldwide. Besides
leading to many human tragedies, these mistakes disrupted air transportation worldwide, slashed
airline profits, and tarnished Boeing's reputation. Following the deontological view, Boeing did
not fulfill its obligations to be honest, open, and ensure safety for people. The company waited
until it was forced by external news and investigations to take full credit for the problems and
release its internal reports. Such actions are against the basic rules of practicing engineering and
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professional responsibility, as they prioritize people, report truthfully, and obey all regulations.
The recent acts of wrongdoing at Boeing point to a lack of strong morals in the company.
Frequently, leaders decided to act ethically when it was required under the law or according to
what their competitors did. Because of this, trust decreased among people outside the company,
government agencies, and even inside the company among the workers.
Personal Perspective
Dealing with Boeing's organizational matters requires a significant change in leadership,
values, and operational trust. On a personal level, ethical leadership must be at the heart of this
transformation. Managers must demonstrate the values they hope to spread in the organization,
creating a setting where acting with integrity is the usual course (Daft,>2020). Therefore, those in
charge should express safety as a principal value and go ahead with choices that are safer for
staff rather than more profitable. The top management must ensure that open communication
forms the cultural foundation of the organization. Boeing should encourage and support
engineers and safety personnel whenever they bring up issues.
Putting in place a secure whistleblower process, organizing safety forums, and offering
rewards for reporting risks can overcome the fear that prevented anyone from speaking up about
risks in the past (Kenny et al., 2020). It is also necessary to recreate an emphasis on safety by
significantly updating risk management policies. Boeing should ensure its oversight is robust,
strictly comply with safety laws, and audit the infrastructure, culture, and values. In addition to
following regulations, Boeing ought to set up groups of safety experts that involve people from
various fields, some of whom are not employed by the company. It is important that these
evaluations are made clear and the findings are given to everyone, including members of the
staff, officials, customers, and the general public. Regaining stakeholders' trust will be at the
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heart of checking how successful Boeing's transformation is. This demands being open with all
stakeholders, confessing errors, explaining the changes that will happen, and reporting back on
how things are being done.
A company can earn back people's trust only when its words and actions are consistent.
By using these methods, Boeing must stop treating stakeholders as transactional and, instead,
realize that it has an ethical responsibility to society, its customers, and its workers. Developing
leaders who can do their job well and act morally is also necessary (Newstead et al., 2021).
Ethical learning, role-playing different situations, and gaining new points of view across
functions must be part of any leadership training program. The assessment of these leaders is
important for their financial success and their support of Boeing's priority aim, which is to ensure
the safety of those who fly through effective and groundbreaking solutions. In light of the crisis,
Boeing needs leaders with strong ethics, a safety culture, open communication, and real
accountability for all their policies and actions going forward.
Biblical Perspective
The difficulties Boeing has experienced, connected to compromised integrity, bad
leadership, and poor communication, reveal a bigger ethical problem. For Christians, these
challenges may be solved by returning to the fundamental truths Scripture teaches. The Bible
tells us that ethical and lasting leadership depends on honesty, accountability, modesty, and
dedication to others.
The Foundation of Integrity
“The integrity of the upright guides them, but the unfaithful are destroyed by their
duplicity.” – Proverbs 11:3 (NIV, 2011). Integrity, as described in Scripture, means having a clear
moral direction and acting consistently with what you believe. Not revealing key information
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about the MCAS system on Boeing's 737 MAX aircraft is considered by many to be a significant
failure of Boeing's integrity. The decision to focus on getting approval and competing in the
market rather than explaining the risks to pilots, regulators, and the public ended in disastrous
results. When truth is not considered important, it becomes evident that many risks are involved.
According to the Bible, leaders and decisions at every part of an organization should reflect
honesty and sincerity. The Bible points out that true leaders should be honest and credible for the
organization to thrive and stay credible. Leaders must realize the company's past mistakes and
ensure that being ethical is accepted and valued at Boeing. Efforts to make aviation safe might be
seen through open discussions of engineering risks, emphasizing pilot training, and ensuring that
safety cannot be compromised. It is only possible for projects to reveal their whole identity when
integrity is actively lived, rather than just being something said.
Accountability and Stewardship in Leadership
Accountability and stewardship in leadership are grounded in the understanding that, as
Romans 14:12 (NIV, 2011) reminds us, “each of us will give an account of ourselves to God,”
and as stated in 1 Corinthians 4:2 (NIV, 2011), “those who have been given a trust must prove
faithful.” Biblical leadership is built on accountability. We learn from the Scriptures that leaders
have the role of serving and caring for fellow believers. As a result of the Boeing crisis, it was
found that workers feared speaking up and felt pressure to fit in and that already little oversight
hindered safety. It was reported that bringing up safety issues might result in retaliation, which
suggests the absence of proper and moral responsibility in the company. All believers are
reminded by Romans 14:12 that they will one day answer to God for how they behaved and led
people around them. Boeing's executives were responsible for guaranteeing the safety of people
using its planes worldwide. Faithfulness is expected in biblical leadership, not only for the
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shareholders but also for the community. Companies that use biblical accountability have
policies to prevent one individual or department from taking excessive authority. Boeing can
again prove its strong leadership by using independent audit groups, making it safe for
whistleblowers, and ensuring expressions of concern are valued as a precaution rather than an
issue. Good stewardship requires loyal action, responsibility, and fitting decisions for what is
best for everyone (Daft,>2020).
Servant Leadership as a Model for Organizational Renewal
Servant leadership, as modeled in Scripture, emphasizes that true greatness comes
through service, as reflected in Matthew 20:26 (NIV, 2011)—"Whoever wants to become great
among you must be your servant"—and Mark 10:45 (NIV, 2011), which reminds us that "even
the Son of Man did not come to be served, but to serve." Servant leadership, as shown by Jesus
Christ, goes against the usual approaches to leading others. It urges people in leadership to act
for the good of people, not to achieve personal gain or dominate the market. However, Boeing
often played the crisis by defending itself and focusing on their interests. They focused less on
admitting fault or helping victims and others affected by the accidents and instead emphasized
protecting the company's name. Boeing should restructure its organization according to the
values found in the Bible. As a result, everyone in engineering, quality assurance, and at the front
line should be heard, and their safety ideas should be implemented as soon as possible. It is
important to keep the passengers' perspective in mind while designing and training new aircraft.
To be a servant leader here, one must respect others, care about what happens to them, and have
the strength to do what is right, even if it is not the most profitable option (Lemoine et al., 2021).
Sticking to these values might help Boeing win back people's respect and set a proper cultural
foundation within the company.
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Rebuilding Trust through Repentance and Restoration
Rebuilding trust begins with genuine repentance, as we are reminded in 1 John 1:9 (NIV,
2011) that “if we confess our sins, he is faithful and just and will forgive us our sins and purify
us from all unrighteousness,” and in Matthew 3:8 (NIV, 2011), we are called to “bear fruit in
keeping with repentance,” demonstrating true change through our actions. The way a person
should repent is not quick and shallow. It results in profound and significant changes within me.
It asks people to admit what they did wrong, truly and sincerely change their ways, and
thoughtfully fix what they caused. Boeing did not respond with humility or clear moral values
when the 737 MAX crisis occurred. Although the firm eventually took these significant steps, it
seemed that rules and criticism forced their changes more than a desire for renewal. As the Bible
says, it is important to tell the truth before you begin to repent. Boeing's leaders must make clear
and simple statements, admitting all the technical and ethical problems contributing to safety
risks. Scripture tells us that restoring life can come through being just and honest. Such actions
by Boeing could include forming an independent ethics panel, supporting families with real
assistance, and ensuring that audits are performed repeatedly to maintain safety. Honesty,
accountability, and humility can reduce Boeing's workplace culture. They build back confidence
in these companies and give many a good example of how global corporations can deal with
problems honestly and with good values.
Conclusion
The Boeing 737 MAX issue shows how much ethical leadership, a positive
organizational culture, and reliable risk management are needed. This showed that when workers
are not honest and things are not made transparent, paying more attention to profits than safety
can bring disastrous outcomes. Moving forward, Boeing should emphasize responsible behavior,
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truth, and self-sacrifice for the greater good, ensuring safety and the importance of the
employees' views at the company. It is necessary to make these changes to win public trust and
prevent additional mistakes. Boeing's issues demonstrate the influence of leaders and culture on
an organization's achievements and the quality of life of its stakeholders. Following ethical
principles and making wise choices is essential for a company to advance and thrive long-term.
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