In 2010, Boeing was caught by surprise when its competitor, Airbus, announced it would introduce a new version of its A320 jet with fuel-saving engines. The new model would be otherwise so similar that customer airlines could skip the expense of retraining pilots. Boeing quickly announced that it would similarly update its popular 737 plane. When the 737 MAX made its first flight in 2016, Boeing recommended that training could safely be limited to computer-based education in place of a flight simulator. Less than three years later, tragedy struck twice: 737 MAX jets taking off from Indonesia and Ethiopia crashed soon after takeoff, killing their crews and passengers. In both cases, a faulty stabilizer pushed down the jet's nose, triggering multiple warning devices that pilots were unprepared to deal with.

The circumstances are still being investigated, but various conflicts may have played a role. Some involved tensions between management and employees regarding cost cutting as Boeing moved to get the 737 MAX into production and into customers' hangars. Boeing uses pilots to test its planes and train customers' pilots to fly them. Training started as a service accompanying sales, but Boeing more recently saw potential in making it profitable. Boeing shifted work from employee pilots to contractors. Saying this would compromise quality, the pilots formed a union. The company then moved its flight simulators from Seattle, where the unionized pilots were, to Miami.

When they were in Seattle, the pilots who work for Boeing would consult with engineers and tell them about situations they experienced in the cockpit. Moving training to Miami disrupted these informal exchanges of information. In addition, Boeing saw a departure of other skilled labor, including experts in human factors, or the way people interact with machines. Their absence became another risk to designing a safe jet. One glaring omission: Apparently no one tested pilots' reaction to the type of malfunction that caused the crashes.

Other conflicts emerged after the crashes. CEO Dennis Muilenburg met with other executives to decide on a path forward. Muilenburg, trained as an engineer and with experience in Boeing's defense division, is said to have focused on how to ensure the 737 MAX- by far the company's biggest source of revenue-could keep flying. He noted there was not yet proof that the crashes had the same cause. Some in the Federal Aviation Administration wanted to ground the plane, but senior FAA officials agreed with Muilenburg's preference to allow the plane to fly. Over the following weeks, as more data became available, the FAA joined other countries' regulators in banning the 737 MAX from the air.

From there, however, the conflict with regulators deepened as statements by Muilenburg made presumptions about the FAA's position. He said that within weeks, the FAA would approve what he called a software enhancement to the flight control system, making an "already safe aircraft even safer." He observed that the company had properly sought the initial approval to fly and that the FAA had granted it. Muilenburg repeatedly made public statements estimating when the planes would be allowed to fly again, even after FAA acting administrator Dan Elwell asked him not to keep making promises. Critics had been noting that the FAA had relaxed its regulation of Boeing in the past, and Elwell was concerned about the agency's reputation.

Later, as the Justice Department investigated whether laws had been broken, Boeing discovered instant messages in which one of its pilots mentioned having unintentionally "basically lied" to regulators. Boeing shared the information with the investigators but not the FAA. This led the agency's new administrator, Steve Dickson, to warn Boeing of stricter regulation if it continued to undermine the FAA. After Muilenburg made another prediction that Boeing would have the 737 MAX flying soon, Dickson firmly indicated that his agency would not be following a schedule and would not be allowing the 737 MAX to fly that year.

During this time, Boeing had continued to assemble 737 MAX jets to fill a backlog of orders.

But after Dickson's statement, Muilenburg announced that the company would suspend production. One week later, the board of directors asked Muilenburg to resign, saying the company needed new leadership in order to restore confidence and repair relationships with customers and the FAA. The following month, Dave Calhoun became CEO, and Boeing announced it recommended 737 MAX pilots undergo training in the flight simulator.

1. Categorize the conflicts discussed in this case as interpersonal, intragroup, intergroup, and interorganizational conflicts.
2. Review the conflict management strategies. Pick two and describe briefly how Muilenburg could have used them to handle conflict more effectively.
3. Muilenburg was in a position of power, but he did not maintain power effectively enough to keep his job after the 737 MAX jets crashed. Of the political strategies for gaining and maintaining power, identify one that could have helped Muilenburg fulfill his role more effectively. How could he have used this strategy? Who would have benefited?