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Ford shows a new reflective side, but how far will they take it?

by Jamie Flinchbaugh on 05-08-13

Ford has come an incredibly long way in time since Bill Ford Jr. courageously stepped aside to bring in lean thinker Alan Mulally.

Lately, they’ve been hampered by the embarrassing problems in relaunching the Lincoln brand through the MKZ. But, in the face of these problems, they are doing their best to reflect and make systematic improvements to prevent these problems in the future, as Automotive News reported.

The old behavior? Beat up the suppliers, and beat up any of the managers who allowed the suppliers to fail in the first place. Tell the dealers to stop complaining because they are lucky to have the Blue Oval anyway.

The new Ford? When you screw up, admit it. Then, reflect on why. Then, fix it.

Ford Logo Wallpaper HD

The industry has been going through many supplier problems lately. During the downturn in the industry, a lot of capacity was taken offline, both physical capacity and human capacity. As things have ramped up, it has put a strain on the supply base across the industry.

Joe Hinrichs, new President of Ford North America:

Hinrichs admitted that the frenetic pace of new- and redesigned-model launches during the past two years strained Ford and its suppliers as they were recovering from the recession. Because the rapid pace of launches will continue, Ford and its suppliers have to be prepared, he said.

To solve this issue, they are putting more resources in place closer to the point of activity, at the suppliers, to help both identify issues earlier and help resolve them. That’s the “what” of the solution. The “how” will matter greatly. Will they put in place people who act collaboratively with suppliers, and processes to enable issues to be surfaced without retribution, or are they just an earlier bat to the side of the head of the supplier? I hope the former, but execution will matter.

Another root cause of their problems relates to product complexity, where offering more choices to customers goes beyond paint color and selecting what stereo interface you receive, there are more combinations of components that affects fit and finish and assembly processes that they can’t test them all. As a result, they are trying to use more 3D modeling to identify such issues earlier in the process.

Ford has come a long way. Rarely has that change been more dependent on one person: Alan Mulally. Many, many people did the work, but he established a new culture for Ford. The real test: he has put in place steps that lead to his retirement. Will the new Ford culture continue to grow, or will it quickly revert after his departure? Only time will tell.

Comments

  • Hi Jamie

    I agree with you it will be interesting to see what happens to Ford after Malally leaves the company, will the old Ford attitudes return or will they hold the present course. The answer will come as a result of what Bill Ford Jr. does when the time comes. The Ford family control the company and Bill makes their descisions, who he ends up putting in that place will actually determine what will happen next. The only true bright spot is that he one knows his weaknesses and how they failed to help Ford, hence why he went after Malally, Bill is the first humble Ford in a long time, he wants success, and he is willing to let qualified other deliver it. I feel as long as he is the one representing their family he will choose someone who will build the company, he has proven he cares about it and that is actually half the battle.

    http://www.elseinc.com May 8, 2013 at 8:47 am
  • ‘m a big admirer of both Bill Ford and Alan Mulally and glad they are doing what they have done to make Ford better — in fact, grateful, because a good part of our family income depends on the company.

    For years, critics have pointed to the “layers of clay” in the levels of management between Mulally, et al and the rest of Ford. The plants are doing a good job, but it’s not enough.

    I am not impressed with the focus on salary, workforce size, and labor cost that continues. Thousands lost — or gave up — jobs in the recession. It’s obvious that there was some bias in retiring older engineers and managers, and scrambling now to find younger ones. The union two-level wage contract is worrisome. $14 an hour is not enough to raise a family, send kids to college or technical school, or buy a truck. Wages and salaries, totaled up as a line item on a financial report, look like a lot. But as the % of the cost of a vehicle are much less significant than things like warehousing, logistics, interest, and so on (could be different factors but you get my point). These are company strategies endorsed at the top. Slash-and-burn workforce policies are not respectful of people.

    Great product is a Ford strength, so at least they have a sense of the market needs and wants. Getting the top line right is the first key to competitiveness and prosperity.

    Back to Bill, I will never forget when there was an accident at the power plant in the Rouge. Against all advice, Bill stopped a meeting, drove to the site, and personally guaranteed Ford would do everything possible for the injured workers and the families of those whose lives were lost. It was an accident that never should have happened, but Bill Ford took responsibility, came to the site himself, and humbled himself.

    Strength of character in a leader — what a concept!

    Karen Wilhelm May 8, 2013 at 10:34 am
  • Karen, I agree Bill had some fundamental leadership qualities that were really strong. I admire how he recognized that he was not the guy to take the company into the future, and stepped aside knowing that he would never be presiding over it’s resurrection. It’s like a pitcher loading the bases and then saying “I don’t have it, bring in someone else.” It’s highly unnatural. But it was the right decision.

    He also got a tremendous amount of grief from all over about not bringing in a “car guy” as people thought you needed to be from the industry in order to run it. He certainly proved that wasn’t the case.

    Jamie Flinchbaugh May 8, 2013 at 11:32 am