More quotes from Frederiek Toney, Ford corporate VP, at the Distinguished Speaker Event on 21st November 2013:
Henry Ford built his company upon one belief: “Open the highways to all mankind.”
So, how to run a company like Ford on Earth today? Changing the approach to management methods: regional vs. multinational vs. global — the old fiefdoms vs. today’s centralised decisionmaking implemented in 2006 at headquarters in Dearborn, Michigan, USA, realising at the same time that business is no longer U.S.-centric…
- profits consolidated,
- high economies of scale (leverage procurement, lower total cost),
- better operating efficiency (avoid duplication, seek simplification),
- reduced complexity (design/build once).
Trust and transparency supported by the business environment, changes of leadership — new CEO in 2006, Alan Mulally from Boeing, who chose to maximise the most from the existing executive team at Ford rather than replacing all of them.
- One Ford Better Plan — One Team, One Plan, One Goal
Improve the balance sheet — took $34B loan before economy collapsed, didn’t depend on government bailout — in 3Q ’13, 17th consecutive quarter of profitability, 14th consecutive quarter of positive cash flow
“Competing to leading…” — Four Pillars of Global Product Strategy: Quality, Green, Safe, Smart
Changed Ford’s organisational structure from silo-based fiefdoms to a matrix-based system, business units intersecting skill teams.
Recipe for Global Success
- Cultures — respect and work across cultures
- Time zones — open for global business 24/7
- Weekly reviews — “data will set you free”; facts, not emotions
- Global special attention reviews — “cannot manage a secret”
- Sharing best practices — compensation based on global results
- Team spirit — crossregional/functional cooperation
- Hard and rewarding work
Two models — mass market (Ford) and luxury (Lincoln)
Consumer Experience Movement — customer taken care of by dealer who is taken care of by Ford
- “Must be present to win”
- Good ideas come from anywhere
- Consistent and constant communication
- Global team members help each other when objects are aligned
Formula for success
- Geographical region shift + consumer preference shift + One Ford = profitable growth
What is the secret to effective leadership? Being a great delegator, knowing all the employees in your organisation are aligned to the same principles on which you base your delegation decisions, with diversity in thinking.
What makes Ford a great place to stay? Incumbent on company to attract, train and retain employees; in other words, if you see someone mistreated, you think it will be you next, too.
What happened to Ford’s famously bad relationship with suppliers/vendors? Went from worst to first in supplier trust/respect, rebooting the supply chain expectations and delivering upon them.
How do you increase Ford owner’s use of the Ford service department? Paying attention to the total value chain. New slogan: Bring your Ford “back home!. The old adage still applies: “Good service sells.”