Boeing reduced the size of its top leadership team on Tuesday and enlarged the already extensive authority of No. 2 executive Greg Smith.
The changes, driven by new CEO Dave Calhoun, are billed in a company statement as “preparing now for the post-pandemic industry footprint.”
In a message to employees this month, Calhoun warned that when the world emerges from the pandemic, the size of the commercial jet market is likely to be significantly smaller.
“We will need to balance the supply and demand accordingly as the industry goes through the recovery process for years to come,” he told employees.
This means Boeing will have to cut production to match the need for fewer airplanes.
Managing what may be a massive restructuring on a day-to-day basis, both inside Boeing and in its supply chain, now falls to Smith.
Greg Smith Boeing’s Chief Finicial Officer
Smith, 53, has over the years steadily expanded his role. Appointed chief financial officer in 2011, within three years he was given the added title of executive vice president responsible for business development and company strategy, then later given oversight of all Boeing manufacturing operations.
Now he’ll also be responsible for the supply chain, leading a new overarching unit called Enterprise Operations, Finance & Strategy.
Boeing said his focus will be to “restore production and supply chain health as Boeing and the broader aerospace industry recover from the COVID-19 pandemic.”
The company said it is also combining its legal and core compliance programs, including global trade controls, ethics and business conduct, into a single organisation led by Brett Gerry, chief legal officer and executive vice president of Global Compliance. The company said the new organisation will “help the company proactively address new legal and compliance obligations arising from an increasingly complex global regulatory environment”. Boeing said it will “soon” name a chief compliance officer who will be responsible for leading the company’s compliance, ethics and trade control activities. This person will report to Gerry, with a direct reporting line to Calhoun and the board’s audit committee on compliance and ethics issues.
Boeing faces considerable new regulatory challenges ahead. It must win approval from disparate aviation authorities worldwide to return the 737 MAX to service. And it must navigate the trade barriers and government tensions that have been exacerbated during the Trump administration between the U.S. and both China and Europe.
Boeing said it will soon will name a chief compliance officer, reporting to Gerry, who will be responsible for leading the company’s compliance, ethics and trade control activities. The statement said this “will help the company proactively address new legal and compliance obligations arising from an increasingly complex global regulatory environment.”
Jenette Ramos, the senior vice president who was in charge of the supply chain, will leave the company’s executive council. She will stay on for a transition period in “a special assignment in support of Smith” but is expected to retire afterward.
Also leaving the executive council is Diana Sands, who will retire as senior vice president in the Office of Internal Governance and Administration, with Gerry taking over most of her portfolio.
The departure of Ramos and Sands leaves just two women on the now 12-member executive council: Leanne Caret, who heads the defense and space division; and Wendy Livingston, head of human resources.