Can We Learn Anything from the American Icon?
We all have heard about the success of the auto company Ford. Tidbits like they didn’t take any Federal money while GM and Chrysler did; both GM and Chrysler went into bankruptcy while Ford was on the brink of bankruptcy; Ford is now very profitable, etc.
I’m currently reading the book American Icon written by Bryce Hoffman, an auto journalist since 1988 who started covering Ford since 2005 while with the Detroit News. While I’m not finished with the book, the early chapters reveal some of the strategies that were used.
Up to 2006, William Clay Ford was the CEO, Chairman and represented the Ford family’s 40% ownership. Things weren’t going so well and he finally realized he needed someone from the outside. In 2006 he hired Alan Mulaly, a top executive from Boeing. Mulaly insisted that Ford remain Chairman and that he give full support to his plans. The same commitment was expected from the board of Ford; they were 100% behind their new leader. Teamwork between owner, board and CEO!
Some of the changes were painful but there wasn’t any wholesale housecleaning of top executives. In fact many remain to this day. The big change was to get them working as a Team instead of each having their own turfs. Political infighting was banished. Honesty in all matters was expected so they could solve problems not assess blame.
Mulaly started a weekly business plan review with his newly restructured management. Changes in the plan from previous periods were highlighted and adjustments to get back on plan were identified and agreed upon. This required them all to work as One Ford, work as a One Team, One Plan.
Physical changes needed to be made; plant closings, product rationalizations, new product development. But this cost money which Ford didn’t have at the time so to the banks they went. They mortgaged all their US assets in order to secure the loans. Talk about betting the farm! Commitment to new products was a priority.
What can we learn from this great story? Some of the elements include: honesty between executives, teamwork, commitment of the executive team behind an agreed-upon business plan, shared responsibility between the board, CEO and his team. One Ford, One Plan, One Team.
Some very good leadership points.
You know how the story ends, I like the way it unfolds.