Boeing Defense to cut execs, consolidate divisions

A MQ-25 Stingray aerial refueling drone taxied at Boeing's plant in St. Louis, Mo., in 2018.

A MQ-25 Stingray aerial refueling drone taxied at Boeing's plant in St. Louis, Mo., in 2018. U.S. Navy

The reorganization is part of a wider culture change pushed by the business unit’s new CEO.

Boeing’s defense and space business unit will cut some top executives and consolidate its eight divisions into four as the new CEO works to reshape his company’s culture.

“I am confident this reorganization will drive greater and more simplified integration and collaboration across Boeing Defense, Space & Security,” BDS CEO Ted Colbert said in a Thursday statement. “These changes will help accelerate operational discipline and program quality and performance, while stabilizing our development and production programs. These are necessary steps to put BDS on the path to stronger, profitable growth.”

Boeing’s defense and space business has lost billions of dollars in recent years as it has been unable to execute on key military projects. In many cases, this was because the company submitted low bids to win Pentagon work and signed contracts that required the company to eat any losses.

That’s been compounded amid a 40-year peak in inflation and widespread supply-chain problems stemming from the coronavirus pandemic, which has also wreaked havoc on Boeing’s commercial airliner business.

Boeing named Colbert CEO of its nearly-$26.5 billion defense and space business unit in late March. He had previously run the company’s Global Services division, which focuses on repairing and maintaining Boeing-made aircraft.

During a late-September discussion with business leaders and the financial community in New York, Colbert stressed the need to change the culture at Boeing Defense, Space & Security. He spoke of shifting from a culture focused on building aircraft to one that puts more value on the technology inside these planes, including artificial intelligence.

“The future will be about doing autonomy at scale,” he said at the time. “The future manned-and-unmanned teaming will be tremendously important to our warfighters domestically and around the world. We are in the process of approving all that technology out.”

Colbert also talked about improving diversity within the company.

Last month, Colbert promoted Steve Parker, who had overseen the company’s fighter jet and bomber aircraft programs, to be his chief operating officer. 

On Thursday, Boeing Defense said said it would organize itself around four divisions: Vertical Lift; Mobility, Surveillance & Bombers; Air Dominance; and Space, Intelligence & Weapon Systems.