Ford's new CEO Jim Hackett was a college football player at the University of Michigan, and he evoked his coach, the late Bo Schembechler, during his introductory remarks on Monday. "My old football coach used to say you either get better or you get worse. You don't stay the same."
That's the perceived problem with Ford right now. It's staying the same as a range of competitors from General Motors to Tesla take risks to try to get better. Couple that with a spongy stock price that never seems to gain traction, and it's a little clearer why Ford's veteran CEO Mark Fields is out of a job.
Here's several observations about the stunning turn of events.
– Executive chairman Bill Ford Jr. is looking for his next Alan Mulally, who led the company though one of its darkest periods and set a culture of winning with his One Ford mantra. "I promised myself I wouldn't compare Jim to Alan this morning ... Alan really captured the hearts and minds of our employees," Bill Ford said.
– In some ways, that was tough for Fields, a lifelong Ford executive, to live up to. Mulally transcended the car business. Some thought he looked like Robert Redford. As a former Boeing executive he had no deeply rooted beliefs about cars and was willing to challenge long-held practices. Hackett, who comes from the furniture industry, has a similar approach.
– Optics matter. Analysts, the stockmarket, shareholders, even customers all wondered: What's next? Where is the company's Tesla-fighter? Chevy already has one, the Bolt, and it's on sale. What's happening with autonomous cars? Ford is working on one, but hardly anyone knows that. That could be why the company's top PR man Ray Day is retiring and will be replaced by former newspaper editor and current Ford communications executive Mark Truby. Fields was articulate and answered questions in a forthright matter, but he didn't explain Ford's high level goals like Mulally did.
– With that backdrop, the numbers needed to be good, and they weren't. Sales have slipped 5.1 percent this year. Profits dropped in the first quarter, and the full-year results are expected to be down slightly, Reuters reports.
– Hackett's diverse background clearly intrigued Bill Ford. He led furniture maker Steelcase for 20 years and oversaw its evolving business model as offices shifted away from closed settings to open areas – a dramatic change in that sector. Ford also liked his leadership at Steelcase during the recession, which he argued hit that industry even harder than the auto business. Think about it. Even in hard times, some people still buy cars. Office furniture? Not so much.
– Hackett also was the interim athletic director at Michigan for about a year and a half, a seemingly unrelated job, but Bill Ford noted that "shows his loyalty" and that he could manage a "very difficult and public situation." U-M's football team was mired in losing, and Hackett was able to persuade star NFL coach Jim Harbaugh to return to Michigan, where he played in the 1980s. Hackett also secured one of college football's richest equipment and apparel deals with Nike for U-M.
– Other executives, including Jim Farley and Joe Hinrichs, are getting more responsibility and are seemingly empowered. They will "work closely" with Hackett to "lead Ford's day-to-day operations," Bill Ford said. That's an interesting move, perhaps one that wouldn't have been possible with the status quo.
– Finally, this change likely wouldn't have happened at any other point in automotive history. The sector is changing so much, standing still, or the perception of that, can be killer. Expect Hackett to make changes and more clearly articulate them than Fields did.
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That's the perceived problem with Ford right now. It's staying the same as a range of competitors from General Motors to Tesla take risks to try to get better. Couple that with a spongy stock price that never seems to gain traction, and it's a little clearer why Ford's veteran CEO Mark Fields is out of a job.
Here's several observations about the stunning turn of events.
– Executive chairman Bill Ford Jr. is looking for his next Alan Mulally, who led the company though one of its darkest periods and set a culture of winning with his One Ford mantra. "I promised myself I wouldn't compare Jim to Alan this morning ... Alan really captured the hearts and minds of our employees," Bill Ford said.
– In some ways, that was tough for Fields, a lifelong Ford executive, to live up to. Mulally transcended the car business. Some thought he looked like Robert Redford. As a former Boeing executive he had no deeply rooted beliefs about cars and was willing to challenge long-held practices. Hackett, who comes from the furniture industry, has a similar approach.
– Optics matter. Analysts, the stockmarket, shareholders, even customers all wondered: What's next? Where is the company's Tesla-fighter? Chevy already has one, the Bolt, and it's on sale. What's happening with autonomous cars? Ford is working on one, but hardly anyone knows that. That could be why the company's top PR man Ray Day is retiring and will be replaced by former newspaper editor and current Ford communications executive Mark Truby. Fields was articulate and answered questions in a forthright matter, but he didn't explain Ford's high level goals like Mulally did.
– With that backdrop, the numbers needed to be good, and they weren't. Sales have slipped 5.1 percent this year. Profits dropped in the first quarter, and the full-year results are expected to be down slightly, Reuters reports.
– Hackett's diverse background clearly intrigued Bill Ford. He led furniture maker Steelcase for 20 years and oversaw its evolving business model as offices shifted away from closed settings to open areas – a dramatic change in that sector. Ford also liked his leadership at Steelcase during the recession, which he argued hit that industry even harder than the auto business. Think about it. Even in hard times, some people still buy cars. Office furniture? Not so much.
– Hackett also was the interim athletic director at Michigan for about a year and a half, a seemingly unrelated job, but Bill Ford noted that "shows his loyalty" and that he could manage a "very difficult and public situation." U-M's football team was mired in losing, and Hackett was able to persuade star NFL coach Jim Harbaugh to return to Michigan, where he played in the 1980s. Hackett also secured one of college football's richest equipment and apparel deals with Nike for U-M.
– Other executives, including Jim Farley and Joe Hinrichs, are getting more responsibility and are seemingly empowered. They will "work closely" with Hackett to "lead Ford's day-to-day operations," Bill Ford said. That's an interesting move, perhaps one that wouldn't have been possible with the status quo.
– Finally, this change likely wouldn't have happened at any other point in automotive history. The sector is changing so much, standing still, or the perception of that, can be killer. Expect Hackett to make changes and more clearly articulate them than Fields did.
Related Video:
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