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Question: leading change at ford motor company ford motor company was...

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Leading Change at Ford Motor Company Ford Motor Company was barely breathing when Alan Mulally became CEO a few years ago. The company recorded massive losses as its sales and reputation plummeted. Today, having weathered the worst economic downturn in 50 years, Ford’s production efficiency, customer satisfaction ratings, and market share are rising. Five out of six Ford employees say their company is heading in the right direction. Mulally has been hailed as a turnaround champion by transforming Ford into the most successful and competitive automaker in America. How did this remarkable transformation occur? Most observers point to Mulally’s vision for change (“One Ford—One Team, One Plan, One Goal”), which focused everyone on one brand (Ford) with a few models that have global platforms. This change was difficult because executives jealously guarded their vehicle badges and built their products mainly for the North American market. Ford’s transformation was not without pain. It closed 16 manufacturing facilities, laid off many staff, sold off peripheral brands (e.g., Land Rover, Jaguar), and negotiated lower labor costs. Mulally took a hands-on role to change Ford’s defensive and territorial culture. He joined staff in visiting customers and industry groups. He held numerous town hall meetings, repeating the same message: Everyone needs to cooperate more across divisions and focus more on customers than on careers. He also emphasized the urgency for change: “We have been going out of business for 40 years,” Mulally stated at several sessions. Mulally shook up Ford’s bureaucratic defenses by persistently challenging engineers and executives to answer tough questions about quality and profitability. To reinforce change, Mulally created a pilot project—a special global task force that designed and engineered a new Focus with the same chassis, features, and name around the world. Today, the Ford Focus is Mulally’s “proof point”—a beacon of his “One Ford” vision. Mulally’s toughest challenge was to develop an executive team that focused on “One Ford” rather than departmental fiefdoms. He helped accomplished this goal through weekly business meetings, where his 16 direct reports were required to pay close attention to each other’s presentations. Private chats and other distractions were prohibited. “If you aren’t comfortable with that, you might be more comfortable leaving the company,” said Mulally with a friendly, yet meaningful, tone. Alan Mulally’s successful turnaround of Ford Motor Company required creating a vision for change, communicating a sense of urgency, and the development of teamwork— no easy leadership tasks.84 Mulally continues to lead Ford, guided by Henry Ford’s original ideal of universal human mobility. Questions: What would you do to sustain Ford Motor Company’s turnaround momentum? What actions would you take in the three key areas of people, production, and profits?

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