Ford's Mulally Fighting the Good Fight against Corporate Culture
When Bill Ford Jr. stepped down in September, a lot of people were surprised. When he went outside the automotive industry all-together to find his replacement, a lot of insiders were stunned. Now, however, things are starting to make more sense. Word has been leaking out about the depths of corporate cancer that had spread throughout the Blue Oval. In-fighting, cronyism, and back-stabbing stifled programs and new ideas while breeding an atmosphere of failure. Promoting any individual within Ford would have kept the culture intact. An executive from another automaker could bring his or her own baggage to the table.
Alan Mulally, who shined brightly at Boeing during tough times, was brought in to destroy the culture at Ford. Weekly meetings where executives must be accountable for their team's performance have been taking place since the very beginnings of the Mulally regime. Talks with the UAW about contract negations started in JANUARY – months before they ever have before. The company's downsizing is also moving at a torrid pace, with 27,000 employees leaving by the end of 2008. While ground-breaking products take time, for the near-term Mulally is doing everything he can to put a positive spin on everything Ford Motor Company does. In the end, product will always tell the tale of a CEO's success and failure. We need to see more outstanding Ford product and we're sure you do too.
[Source: The Car Connection]
Reader Comments (Page 1 of 1)
Gardiner Westbound 8:32AM (1/30/2007)
Things may be turning around for Ford product-wise. During a short drive Sunday I saw five Fusions. I don't think of seen that many Five Hundreds and Freestyles since they were introduced.
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Chris 9:08AM (1/30/2007)
Mulally has his work cut out for him. Ford definitely needs a massive boot in the ass to correct decades of crappy cars and worse management. I wish him well.
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QED 10:29AM (3/12/2007)
It begins and ends with product.
Bring out that Mustang sedan, or whatever you're going to call it, sooner rather than later! And keep its weight down, too.
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mr.ed 9:38AM (1/30/2007)
Sounds like lots of early executive retirements coming in Dearborn, eh? This is just what the entire Wayne county area needs- a big dose of reality.
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Michael Karesh 9:13AM (1/30/2007)
Good to hear that the focus inside Ford might be shifting from politics to products.
For some insight into what life inside Ford has been like, check out "Car Launch: The Human Side of Managing Change." It was written by some MIT researchers based on some consulting they performed with one of the company's product development teams. The main guy they worked with got canned.
One thing I don't see Mulally changing is the fast-track career system. These companies channel far too much of their emphasis into grooming executive talent, and too little on developing and enabling expertise at the levels where the products are actually created. My two-pager on this:
http://www.truedelta.com/execsum.php
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P to the C 9:43AM (1/30/2007)
What Mulally is fighting at Ford is standard operating procedure (SOP) at almost all corporations today, it's just that if you have good product then it tends to mask the problems created by feifdoms, cronyism and back-stabbing. Fighting this kind of self-inflicted crap is a definite plus for Ford but without good product it's all in vain.
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Nick 11:02AM (1/30/2007)
I thought from the start that an outsider would be perfect in a company like Ford. Anyone from within the company would have just been another that was prepped and groomed by the very system that needs to be destroyed.
This company desperately needed someone to step in look around and say: "Why the hell are we doing this?". And, then, actually hold people accountable for their crap...something Jr. never did. Given time, I beleive that Mulally will be the guy that sees the job get done.
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Brandon 11:50AM (1/30/2007)
I didn't have a lot of faith in Mulally when I first heard he was coming to Ford from Boeing. I pictured him as more of a new kid on the street by changing industries and that he would have a long uphill battle to become accepted as CEO.
However, it seems that he has hit the ground running and chose to take on the mountain rather than the hill and actually fix problems rather than find ways to cut costs to show "growth" happening so he can get a bonus without working on the core.
Good on ya, Mulally. Keep it up and Ford might actually turn itself around.
The problem is the public perception of the Ford brand. Many think the only thing keeping Ford alive is the Mustang and F-150, when it's just not true. Yes, Ford has a pile of cash next to an open window, but their products are initially much more solid than they were 10-50 years ago.
Unfortunately, so many former Ford owners are so disgusted by their previous purchase, they've written off American products altogether. Even future models are described as "unreliable" and "poor quality" by some. I think that by 2010, when the long term reliability ratings for the most recent Ford products are proven, attitudes may change.
Mulally has 3 years to turn around Ford's corporation until more of the public will start accepting Ford is a viable and reliable purchase. Only when those both happen will Ford begin to see real growth or profitability.
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oldfordfan 12:35PM (1/30/2007)
Actually I find it kind of interesting that Alan Mulally was brought in from the outside to "break-up" the Ford Culture and make it more innovative but yet he defends their bonus program saying it is necessary to keep highly qualified upper managment people??? Mark Fields @ some $900,000/year in salary needs to have in his contract use of a corporate jet so he can fly home to Florida every weekend?? All this while showing the biggest loss in Ford's history/closing how many plants and laying off how many thousands of people which in turn affects thousands of other jobs and people in the plants affected by these shutdowns/layoffs?? Plain and simple - when you are running in the red @ $24,000/minute - those that do not get bonuses - SHOULD BE LET GO!!! If your main criteria for "hanging around" and not understanding "the rest of the story" as to why you are not getting a bonus - then you should leave - translated - if the work ethic for upper managment @ Ford is this bad - those folks who would not recieve a bonus are called "deadwood" - time to go bye bye.
Mark Fields?? While what he did with Mazda is great and his other accomplishments - if he is serious about his job @ Ford and is making $900,000+/year - the golden boy can either purchase another home close to where he works or rent an apartment like the rest of us would do. Mr. Fields should have not had this in his contract to begin with and should have killed it himself besides - it is called "commone sense" and fall under the category of "professional ethics."
These types of antics are exactly and specifically why Ford has the problem(s) it does. I am not a huge fan of the UAW but I have to agree with them because it sure appears as if the "good old boys club" is both alive and well (even at this time of crisis) and that they still have not wrapped their heads around reality (in upper managment) that this is make or break time for them too - not just the union members - everyone sacrfices w/no exceptions - if someone does not like it - leave and let someone who cares about getting Ford back on track do your job is my opinion to both Mr. Fields and the rest of upper managment w/regard to their bonuses. Alan Mulally - if he is also 100% on board - needs to make this extremely crystal clear that their will be no bonuses/no private use of corporate jets (Mr. Fields contract should have made clear that if he wants to work in Detroit - he lives there to in my opinion)/no jobs in about 3 years if things do not change!!!!!!! Put bluntly - "shape up or ship out" as the saying goes.
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Just saying 1:41PM (1/30/2007)
Impressive rant 'oldfordfan' but Fields has already caved and given up the flights home to FL. Thats old news.
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Chris 1:31PM (1/30/2007)
I know some will get all pissy but product will only go so far. You need the culture changed so that clear and logical plans can be executed whether its in finance or advertising. I test drove an Edge a couple of days and was thourghly impressed but the the ad campaign sucks, same with the the Five-Hundred which is also a really good car with alot of features. It may look bland but so does every other family sedan out there but I have never seen an ad touting its massive back seat and trunk space along with optional AWD. The product isn't as bad as people think or want to think but they do such a terrible job of marketing that nobody knows about it. Look at how many F-Series ads there are and see the correlation in sales. Now look at the number of Five-Hundred ads and look at its sales. Ford (and GM and Chrysler) don't market the cars just their "firesale" deals.
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Make a Lincoln as a Lincoln PLS 2:15PM (1/30/2007)
For the past 6 years Ford just excuted bad desicions and did all kinds of weird things just like our politicians. I just don't get it how such an auto empire get itself so desperate and hopeless. I'm considering my first new car now but by no means I'm interested in ANY of their products. why? Blue oval are loathsome to us 25-30s guys, plain and simple.
let's check out their score board:
Lincoln: ruined. the only REAL lincoln is aged TC and the rest are serious JOKES to this beloved brand of my parents. Actually I always think about an LS for me but now that's an orphan. This brand is officially dead in 2006.
Mercury : Are you kidding ? let me take Jill Wagner and leave this graveyard ASAP.
Ford: I can't front, actually 500 and freestyle are half-nice half-ass product worth the dollars if HUGE rebate granted. but they just make it ugly, and uglier by every passing day .. these two modals will be described as the most miserable cars in history from day one.
08 malib make fusion a joke, and ..IMHO, even my friend's 97 contour make focus a joke.
I don't care what Mullary's doing, it will be after 3 years what he's done showing on my radar. before that Ford juat a niche brand including Mustang and F150, and bunch of other modals embarrassing themselves.
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olfordfan 8:24PM (1/30/2007)
In response to "just saying" about my "rant" and Mr. Fields - the point(s) were missed.
Yes - Mr. Fields did cave in and it is somewhat old news or is it? The whole issue of Mr. Fields - President of the Americas - along with Ford's culture and a couple of points I was trying to make is that:
1.) Courtesy of Mr. William Ford a/k/a "Jr" is that Mr. Field's was taking his position knowing what dire straits Ford was in to begin with. Mr. Fields should have never been offered by Mr. Ford personal use of any kind of corporate jets - knowing what it would cost to fly him home every weekend and back period - an un-needed expense that creates no value for the company - a frivlous "perk".
If Mr. Ford and Mr. Fields (especially Mr. Fields) were 100% on-board with a practice Toyota uses called "lean manufacturing" they would have both recognized this and the issue would have never been put on the table. (Strike One!)
2.)Mr. Fields should have never accepted (see comments about common sense and professional ethics) this bonus/perk.
Since both Mr. Ford and Mr. Fields both have a long history of being in the "good old boys" club at Ford - this is probably wishful thinking on my part. (Strike Two!)
3.)Alan Mulally should have cancelled/killed any and all bonuses/perks like this kind of garbage for upper managment from week one he came on-board - HELLO - biggest loss in our corporate history??? $24,000/minute??? HELLO??? Anyone home?? Brain on??? Alan cannot kill this type of "me thinking" that Mr. Fields and his "corporate brothers" are still apparently practicing fast enough or quick enough for Ford's future. (Strike Three - you should be out!)
4.)Mr. Fields only caved in and gave up personal use of the corporate jet after he was embarassed from the media and because of peer pressure accordingly.
Yet, Ford (Alan Mulally is now CEO @ the time of Mr. Fields problem) is instead going to pay somewhere around $1500 - $2000 a week for him to take a commercial flight every weekend instead??
Here is a radical thought though - based upon a salary of $900,000 a year and Ford losing $24,000/minute - Alan Mulally should perhaps tell Mr. Fields that if he just has to fly to Florida every weekend because it is to difficult for him to live near where he works - perhaps Mr. Fields should pay for his own flights out of his own salary??? Gee - I wonder if poor Mr. $900,000+ year can afford it to pay for his own flights????
If Mr. Fields is insistent that Ford pay for this and Mr. Fields believes he is that "precious" to Ford - I suggest he finds other employment!!!
Also keep in prospective that Mr. Fields has been there much longer than Alan Mulally and that he is perhaps the main man in Ford's "Way Forward" plan??? Mr. Fields is making how many decisions to put how many people out of work/close how many factories/cut waste/expect how many tens of thousands of people to sacrfice for Ford and the whole time he is getting paid how much more than the average employee but yet the company must pay for private flights to his home to Florida every weekend??? (Go back to common sense/professional ethics.) The point again is that Mr. Fields should simply no better considering what he is asking of others with the "way forward" plan - the whole issue of corporate paying for his flights should never have happened or occured and is an awesome example of the mentality that Alan Mulally needs to just "kill" asap!!!
If Mr Fields a/k/a "President of the Americas" could not see what was wrong with his personal use of the corporate jet for this - what other things does he just "over look" until someone such as the media and peer pressure point out to him???
Alan Mulally needs to get Mr. Fields and the rest of Ford out of this mode of thinking - they will not be around in 3 years and if corporate Ford continues this type of thought processing - w/particular to the fact that Mr. Fields seemed oblivious to why this was even an issue - Alan Mulally and Mr. Fields will be locking the doors and shutting off the lights in three years or less is one of the points of my "rant."
Do we ever hear about these kind of ridiculous things happening with executives for say Toyota??? NO! Why? Lean being practiced/used w/no exceptions.
To try and somewhat summarize my point - is that if Alan Mulally was actually brought in from the outside to "kick butt" and get the managment of Ford to actually start designing and building things that increase sales/increase market share/and make some profits instead of losses - everything is on the table and all expenses and/or thought processes need to be focused accordingly. Mr. Fields and other executives are no exceptions of any kind for any reasons - period - discussion ended.
In the past - especially during the 1990s including up to and today - Ford's corporate culture appeared to be a focus a lot on:
1.) Purchasing other smaller car companies for not other reasons than:
We have the money.
We do not care about long-term - let the good times roll and worry about tomorrow when it comes.
We need more expense - uh OK????
Are you not impressed with us yet???
Any good business reason???? Any at all???
Keep in mind while Ford was busy purchasing other companies it did not need and was doing everything it could to get out of the low-profit car market and into the high-profit SUV/truck market - Toyota was busy doing what???? Maybe thinking and investing for the long-term???? Planning how they got to where they are today???
2.) We had- as another example of the corporate thinking @ Ford for the last decade or more - the Taurus as #1selling car for a while - with Corporate's thinking apparently somewhere along the line of "let's see how we can screw this up."
We now have the #1 selling car - so let's make sure to keep reinvestment back into this line in terms of engineering/marketing/advertising to a bare minimal so we can pay for things like say having an executive work in our corporate offices but have his home be 2000+ miles away and we not only will pay him 20+ times what the factory worker gets but we will pay out say $15,000 - $20,000 per week on top of his salary and bonus so that he can "warm up" on the weekends?? Sorry - just had to.
Now besides the fact that we keep the reinvestment to a minimal on the #1 selling car position we have so that we can kill it - let's sell this same vehichle in fleets @ much lower margins than we normally would so that we can show lots of sales with very low profit margins i.e. why????? Because someone like Mr. Fields or similar can say he created X-amount of sale (little or no profit) and collect a bonus on it????
Come forward to 2006 when we should still have the #1 or at least #2 slot with the Taurus if we would have thought long-term vs short-term and applied some lean principles to our thinking - the price of gas has skyrocketed cutting into our high profit sales of trucks and SUVs; so we will now kill the Taurus this year instead of finally putting the money back into we should have and instead we will come out with "cross overs" and $40,000+ Shelby GT500 Mustangs - along with other overpriced/high performance/crappy gas mileage things.
We did by accident come up with the Ford Fusion/Mercury Milan but what is with "Ford Five-Hundred"? For some reason the name just brings to mind either B-Movies or British Television plus it looks more like something around like a modernized Ford LTD from the 70s - whoever thought up the name "Ford Five Hundred" was not very creative or innovative in name or design - which helps to explain the 500's current sales figures too I think.
Perhaps the thought was if we make it larger number than say Chrysler 300 - people will be impressed??? Again - this type of thinking from corporate - no creativity or anything - just borrow/copy from someone else instead of being creative as it used to be and making the models stand out as they should.
Getting back to Alan Mulally and getting Ford back on track - I hope and pray he can and does get Ford back on track, but again - using Mr. Fields' weekly flights along with the death of the Taurus just a few months ago as one of many examples as to the latest thinking @ Ford Corporate over the last several years - this kind of "not thinking" not only has to end - it must never come back either in the future.
If Ford's corporate thinking would have been to more of "we" along with some long term planning and application of lean principles - perhaps the Taurus would still be the #1 or #2 selling car and Ford would not be in the mess it is today.
Everything is on the table and it is make or break time. Hopefully, Mr. Alan Mulally can accomplish this in 3 years or less.
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Cher Firestone Classick 1:43PM (1/31/2007)
Can't wait for Mullaly (Mularky?) retires, yes
the magic age of 62 is coming up. Why waste all
that money on him. Mr. Ford never took a salary,
you don't see Rick Wagoner caving in.
I love Ford cars and have 4 of them in our family.
They all run great, get the Japanese out of the
country. It's disgusting to see Honda around too,
I think they gave them the land even.
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