Boeing Commercial Airplane Group (BCAG) president Ron Woodard has been replaced by Alan Mulally, former president of the Information, Space and Defense Systems (ISDS) unit as part of sweeping management and organisational changes announced by company chairman Phil Condit on 1 September.

The move follows months of speculation over Woodard's future following a year of serious production problems as the company's attempts to accelerate output from 22.5 aircraft a month to 40 ended in disaster for BCAG. Development problems and the subsequent late delivery of Next Generation 737s also damaged the company.

Despite the setbacks, Woodard's replacement caught many at the company off guard, particularly because Condit recently stated publicly that there were no plans to remove the BCAG president.

The move is being widely seen as a gesture to Wall Street, the investment community at large and the shareholders, many of which demanded a higher level of accountability for the company's unprecedented production problems which reached into virtually every part of its civil aircraft range. Huge write-offs resulting from late delivery compensation payments and production inefficiencies, along with additional write-offs on the McDonnell Douglas merger, meant the first annual loss in its corporate history for 1997.

There is no word on Woodard's next move, although Boeing says "-he is considering his options. He has been offered a position within the company as he is a leader of many talents". The company declines to specify the offer.

Woodard's replacement by Mulally, on the other hand, had been anticipated - even if the timing of the changeover was a surprise. Before taking over at ISDS, Mulally held several senior management positions at BCAG, including senior vice-president of aircraft development and vice-president and general manager of the 777 programme.

Although the final structure of the realigned organisation has yet to be defined, Boeing says Mulally's initial plan revolves around creating "profit and loss" responsibility for product groups. Jim Jamieson, who now heads the 737/757 programmes, will have full "profit and loss" responsibility for the 717, 737, 757, MD-80/90 and MD-11 programmes. Dick Pearson, who heads the Long Beach division, will report to Jamieson.

Profit and loss responsibility for the widebody programmes, the 747, 767 and 777, goes to Jim Morris, who now leads the company's rotorcraft operations.

Other key names in Mulally's executive line-up include Fred Mitchell, who will lead aircraft component and procurement activities, Walt Gillette, who is to head engineering and product development, and Scott Carson, who has become the commercial group's chief financial officer.

In an unrelated move, Boeing president and chief operating officer Harry Stonecipher has also become acting chief financial officer in place of Boyd Givan who retired, as previously announced, on 1 September.

Under the restructuring plan also announced by Condit, the four operating units of ISDS will be consolidated into two. The newly formed Space and Communications group which contains the Information and Communications Systems unit will be based in Seal Beach, California. There is also a newly formed Military Aircraft and Missile Systems group, which will be based in St Louis, Missouri.

Source: Flight International