Boeing workers uneasy about new leadership

Published 9:00 pm Monday, December 1, 2003

Union officials said they hope the change at the top of the Boeing Co. will mark a new direction in how the company deals with its workers.

"We have to give the new leadership a chance," said Bill Dugovich, spokesman for the Society of Professional Engineering Employees in Aerospace. "We’re ready and willing to work with him."

But rank-and-file employees were chagrinned to hear that Harry Stonecipher — who was widely viewed as a corporate heavy pushing for unpopular changes — would take over as the company’s top boss.

"This is probably the most devastating news I’ve heard in my 26-plus years at Boeing," said Don Grinde, an Everett crane operator. "With the appointment of Harry as CEO, our hearts have just sank to new lows."

An analyst said that Stonecipher was the right man in the right place — for right now.

"He’s a reassuring face, and he has the confidence of the investing community," said Richard Aboulafia, with the Teal Group in Virginia. But on the other hand, "he doesn’t have an exactly stellar track record for investing in the future."

Phil Condit’s resignation as chairman and chief executive officer at Boeing came less than a week after Condit announced he’d fired his top subordinate — chief financial officer Mike Sears.

Many companies would find it hard to weather the loss of their top two executives in such a short time, but not Boeing, said stock analyst Peter Jacobs, with Ragen MacKenzie in Seattle.

"The way Boeing is structured, it can easily handle this turnover at the top level," Jacobs said.

In addition, "Harry Stonecipher is well-versed on the company. He’s a very adept manager. He can easily pick up the ball and run with it."

Investors weren’t overly rattled by the resignation. Shares of Boeing stock ended the day down 37 cents at $38.02.

The former CEO of McDonnell Douglas, Stonecipher joined Boeing in 1997 after successfully merging his California-based company, with its strong portfolio of defense contracts but faltering commercial jet business, with its Seattle-based rival.

The merger resulted in many changes to Boeing’s corporate culture, which were attributed to Stonecipher. Wall Street applauded a new fiscal discipline, but employees were rankled by the new bottom-line emphasis and increased job cuts in part attributed to outsourcing of parts work.

"We’ve been unhappy with the direction of the company for some time," said Mark Blondin, the Machinists union district president. "People are looking over their shoulder wondering who is going to get the next boot."

The workers’ dislike of Stonecipher was evident during SPEEA’s 2000 strike, when engineers and technical workers picketed for 40 days.

"He was the focus of a lot of anger during our strike," Dugovich said. "With the merger, change started happening at Boeing, and employees didn’t always view those changes as positive."

The announcement, predictably, was the hot topic of conversation in the factories on Monday, said Alan Gingras, a Machinists union steward who works on the Everett flight line.

Condit’s resignation caught everyone by surprise, he said. "I didn’t think he was going to go."

Some current and former workers said Stonecipher’s ascension to the top spot is final proof that McDonnell Douglas managers have taken over Boeing. Craig Sobottka of Whidbey Island, who took a voluntary layoff in May, called it a "reverse takeover."

He and Gingras said Stonecipher’s track record with labor makes them uneasy.

Stonecipher "had a history when he was with McDonald Douglas of not being friendly with union people," said Gingras, who’s from Snohomish.

"It does not bode well for the average Boeing employee," Sobottka said.

But while Stonecipher "doesn’t have a real good reputation coming in," Blondin said his union will give him a chance.

"We’re willing to meet with him," Blondin said. "We’re willing to see if we can work with him."

Dugovich agreed. Stonecipher is "at the head of the company right now, and there certainly is a refocusing going on. We can only look at that as an opportunity," he said. "That’s not spin, that’s reality."