Boeing, the world-renowned airplane manufacturer, has recently announced a significant change in its employee bonus structure. The company stated that it is overhauling how it pays employee bonuses to emphasize quality and safety. This decision comes as the company has been working diligently to explain and strengthen safety procedures after a door panel detached during a flight. The new bonus structure will tie payouts more closely to safety and quality, marking a shift from the previous focus on meeting financial targets. This year's operational goals will be exclusively focused on these two components. The company believes that this move will help prioritize quality over profits.
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Under the new annual incentive plans, safety and quality metrics will now account for 60% of the payout at Boeing's commercial units. This unit, known as the Boeing Commercial Airplanes (BCA), manufactures commercial aircraft, including the 737, 747, and 787, among others. Boeing's Chief Operating Officer, Stephanie Pope, emphasized the importance of this change in a webcast to employees. She stated, "It's very, very important to drive the outcomes that we're all committed to, and that's to deliver a safe and quality product to our customer".
These operational safety and quality metrics will include employee safety, traveled work, rework, and completing work needed to deliver airplanes in inventory⁵. Previously, financial incentives comprised 75% of the annual award at the BCA, while the remaining 25% was tied to operational objectives including quality and safety. In addition to the changes in the bonus structure, Boeing has also announced that all employees will be required to complete training courses on product safety and quality management as a pre-condition to receiving any annual incentives⁵. This requirement underscores the company's commitment to ensuring that its employees are well-equipped to prioritize safety and quality in their work.
In Boeing's other two units, defense and services, financial metrics will still determine 75% of bonuses. However, quality and safety will be the only factors to determine the operational scores. This change in the bonus structure applies to Boeing's nonunion workforce of more than 100,000 employees. This overhaul in the bonus structure comes at a time when the Federal Aviation Administration (FAA) had barred Boeing from expanding 737 productions, stating that "the quality assurance issues we have seen are unacceptable". By tying more of its employees' pay to safety and quality, Boeing is taking a significant step towards addressing these concerns and rebuilding its reputation for safety and quality in the aviation industry.