Boeing, the renowned aerospace company, is undergoing strategic adjustments in its planning department. Although investors have experienced significant challenges with Boeing in recent years, these changes should not cause any undue concern.

Previously, Boeing's strategy personnel operated independently from the company's business units. However, the company is now integrating these individuals into their respective business units as part of a planned reorganization. This integration will enable closer collaboration between strategy personnel and the teams responsible for product development, supply chain management, and defense and space operations.

Approximately 200 employees will be impacted by these changes, although this represents a small fraction of Boeing's workforce. The company currently employs around 60,000 engineers and has a total workforce of approximately 145,000 employees.

The primary goal of this reorganization is to bring strategy staff closer to the individuals directly involved in product manufacturing.

According to a Boeing spokesperson, "Boeing has implemented measures in recent years to streamline our corporate structure and align our resources as closely as possible with our products, services, teams, and customers."

In 2020, CEO Dave Calhoun made the decision to establish a separate strategy department outside of the business units shortly after assuming leadership. This move followed the resignation of former CEO Dennis Muilenburg during the global grounding of the 737 MAX due to two fatal crashes.

As part of these changes, Chief Strategy Officer Marc Allen will be stepping down from his role, and Boeing has no plans to fill the position following his departure. Allen has served in this capacity since October 2020 and has been a member of Boeing's executive council since 2015.

The combination of challenges related to the grounding of the 737 MAX and the ongoing COVID-19 pandemic has created unparalleled volatility for Boeing and the aviation industry at large. It is likely that these circumstances prompted Calhoun to enact these strategic adjustments.

Boeing did not directly comment on the thought process behind these changes as implemented by Calhoun in 2020.

Boeing's Future: To Design or Not to Design

Investors have been closely monitoring Boeing since the MAX issues and the impact of Covid-19. Despite the MAX's successful return to service in November 2020, there is still a debate on Wall Street regarding whether Boeing should develop an all-new single-aisle jet to outpace Airbus's competing products. Any potential changes that may affect the evaluation process or slow it down deserve investors' attention.

The development of new aircraft costs billions, and Boeing has accumulated tens of billions in debt over the past few years. Consequently, the company has prioritized restoring normal operations and its balance sheet rather than focusing on designing an entirely new plane.

This decision seems justified considering that Boeing had to utilize around $28 billion cumulatively to navigate the years 2019, 2020, and 2021, according to FactSet data. However, the situation has improved, with free cash flow turning positive in 2022 and an expected $3 billion for 2023—although this is significantly lower than the $13.6 billion generated in 2018.

Boeing experienced a significant decline in deliveries, with 806 planes delivered in 2018, 157 in 2020, and an estimated 520 for 2023. However, as the company returns to normalcy after several challenging years, deliveries are projected to reach approximately 800 again by 2025.

Investors and analysts may have to be patient until 2025 or 2026 to learn more about Boeing's plans for a new plane. The responsibility of developing the best design to meet market demand lies with the commercial aerospace division. While this may not seem like a big deal, it actually makes sense.

This perspective seems to resonate with investors as Boeing shares saw a slight increase of 0.2% in early trading. In comparison, the S&P 500 was down 0.2%, and the Dow Jones Industrial Average remained flat.

Furthermore, Boeing received positive news on Tuesday when Avolon, an aircraft lessor, placed an order for 40 MAX jets.