Defense contractors and aerospace companies aren't known for their openness. After all, this is an industry built on security clearances and classified government projects. But today Boeing Co. (BA) is embracing a kind of management glasnost that would have been unthinkable a few years ago.
The evidence? Boeing's use of blogs. The Chicago aerospace giant -- no stranger to recent and well-publicized ethical and political scandals -- is among a small but growing group of large non-tech companies such as Walt Disney (DIS), General Motors (GM), and McDonald's (MCD) that are embracing the power of blogging. That means Boeing has learned to cede some control and expose itself to stinging criticism in exchange for a potentially more constructive dialogue with the public, customers, and employees. "Companies are nervous about creating external blogs because they fear the negative comments," says Charlene Li, an analyst at Forrester Research Inc. (FORR). "But negative comments do exist. A company is better off knowing about them."
Boeing's early results suggest that the rewards outweigh the risks. The company's two public blogs give Boeing a direct link to the public, something the 91-year-old company has never had before. And executives are starting to use internal blogs to get conversations going and allow employees to raise issues anonymously. "I've always been a big believer in open and honest dialogue that gets the issues on the table," says James F. Albaugh, the chief executive of Boeing Integrated Defense Systems (IDS). He championed using blogs at the defense unit's meeting of 1,000 executives in February. "I was a little concerned and I had no idea how it would turn out, but I'm sold on it."
Boeing's entry into the blogosphere got off to a rocky start. Eighteen months ago, Randy Baseler, vice-president for marketing at Boeing Commercial Airplanes, started a Web log to talk about the company's view of the commercial airplane world. Almost immediately, he was blasted by the blogerati for not allowing comments, considered to be a key component of blogging. And he was dinged for the perception that his posts gave more of a marketing spin than an inside perspective. In one e-mail, an outside reader wrote: "Take down your blog. You embarrass us, everyone who reads it, and you make the world a dumber place."
Instead of backing down, Baseler responded. As the blog evolved, he found his voice. He began to offer insights into the industry that would be hard to find elsewhere, such as a post about emerging airplane markets in Latin America, called "Latin Rhythm." His explanation of the differences between Boeing's and Airbus' strategy, particularly an ongoing controversy about how they handle seat width, has been light on emotion and heavy on facts. The site drew 30,000 visitors in April, a new high for a blog that started with low expectations.
Boeing took a different tack when it launched Flight Test Journal in May, 2005. For seven months, engineers, managers, and test pilots gave the public a rare look at the process the jetmaker and federal regulators went through to certify Boeing's newest 777 airliner, called the Worldliner. Tens of thousands of people visited the blog each month to watch videos of the new jet airborne and learn about how test pilots prepare for flights. Says Forrester's Li: "They were very open to explaining how you test fly the jet. It gave me, as a passenger, better assurance that it was going to be a good airplane."
Boeing's latest experiments have focused inward. In February, Boeing's senior IDS leaders set up blog kiosks at the annual strategy meeting in Los Angeles for the company's top 1,000 defense executives. During a series of briefings, managers went over new company policies and the division's top strategic and business priorities for the year. While Albaugh and his team discussed hot topics such as ethical compliance rules and a new management compensation plan, executives responded at the kiosks located outside the conference room. "As each exec talked, they would talk about comments from the blog," says DL Byron, a blogging consultant to Boeing.
In the end, the blog helped air questions about the unit's strategy and made sure everyone understood the human resources and diversity policies. It also let Albaugh understand what his top people knew or didn't know. For instance, he asked how many executives were actively using the division's Vision Support Plan software that helps managers track how their units are doing. About 30% said they weren't. Thanks to the blog, Albaugh can now try to create converts.
By Stanley Holmes