The IAM versus South Carolina: Boeing Loses

What a morning! So much to write about and so little time. DJIA is up, which is good for those that hold Blue Chips. According the Wall Street Journal Boeing stock led the way. Its stock price increased by over $2. Interesting, I wonder what happened.

Another conversation in the paper this morning involved lean manufacturing. The title of the article is For Lean Factories, No Buffer. The use a modern phrase to describe my response to this is “DUH!” If a manufacturer decides to be dogmatic when it comes to Just-In-Time (JIT) inventories they invariably will cause themselves problems with shortages. These shortages result in missed delivery dates, and problems with the customer. All of a sudden these lean factories recognize they need to hold a certain amount of finished goods to insure they meet the customer’s needs. Seems smart to me.

But the article that stood out to me this morning was on the opinion page, and was authored by the Governor of South Carolina. The governor states, “In choosing to manufacture in my state, Boeing was exercising its right as a free enterprise in a free nation to conduct business wherever it believed would best serve both the bottom line, and the employees of its company.” I have to say I agree with this. We are a democracy, and should have the right to choice. But, before you turn this off continue to read.

The governor then goes on to say that Boeing has dumped billions of development dollars into its new site, and has created thousands of jobs for the people of South Carolina. The governor calls its state a haven for employee friendly corporations. The governor goes on to describe South Carolina as a right-to-work state that does not require employees to join a labor union as a condition of employment. “We don’t need unions playing middlemen between our companies and our employees. We don’t want them forcefully inserted into our promising business climate. We will not stand for them intimidating South Carolinians,” Haley stated. On one hand I find a frank politician refreshing, it does not happen very often, but on the other hand I find this comment problematic.

It seems to me the line is now drawn in the sand. The gauntlet has been thrown down. The gloves are off and the slap has occurred. No matter how you say it, a challenge has been given. My fear is labor relations at the Boeing company will move backwards. My 30 years at Boeing Portland was a positive experience. I started out as a union member and ended up in management. What I remember is a positive working relationship between management and labor. My last three years at BP, before I retired, was within Joint Programs, a partnership between management and labor with the purpose of bettering the employee’s work life. People from all over the Boeing Company would visit Portland to observe what Joint Programs in Portland had accomplished. It was positive and lucrative for all stakeholders associated with the Portland facility.

It does appear that the relationship between Boeing and the IAM is moving backwards. Complaints, threats, and coercive actions are not what is needed at this point in time. Andy Grove, past CEO of Intel, and Andrew Liveris, CEO of Dow Chemical, have both stated in their recent writings that we need to make things in the US. They both take a holistic view of how this could be successful. The actions need to include employee, company, and governmental steps to compete against the rest of the world.

The current situation at Boeing is the exact opposite of what is needed. A friend of mine told me yesterday that instead of moving work to South Carolina, Boeing could move the work to South Vietnam (I know there is only one Vietnam now, just used the south to make the point). Collaboration is needed not confrontation. IAM and Boeing, get it together before it is too late.

And that is my thought for the day!

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