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Mulally: 'Including Everybody' in One Ford Plan Has Been Key to Automaker's Turnaround

Dec. 15, 2011
In Part 1 of IndustryWeek's two-part conversation with Alan Mulally, Ford's chief discusses the thinking behind the One Ford transformation plan, and shares how his career at Boeing helped prepare him for the challenges of the auto industry.

It's been said that 70% of all major change initiatives fail. With those odds, the deck certainly was stacked against Alan Mulally when he took over a troubled Ford Motor Co. (IW 500/6) in September 2006.

As we all know by now, though, Mulally has led Ford from the brink of bankruptcy to profitability, respectability and stability -- without government bailout funds.

In the process, Mulally has become the face of the U.S. auto industry's renaissance, and has earned a spot in the 2011 IndustryWeek Manufacturing Hall of Fame.

In a conversation with IndustryWeek earlier this month, Mulally reflected on his career at Ford and Boeing, and talked about the challenges and opportunities on the horizon for America's No. 2 automaker.

IW: Looking back at your 37-year career at Boeing, which of your achievements make you the proudest? [Prior to joining Ford in September 2006, Mulally served as president and CEO of Boeing Commercial Airplanes, after progressing through a variety of significant engineering and program-management assignments.]

Mulally: "I reached out to everybody in the industry when I first arrived" at Ford.

AM: I'm just so honored and thankful to have been able to contribute to all the Boeing commercial airplanes -- the 707, 727, 737, 747, 757, 767, 777 and the 787 -- and the fact that every one of those airplanes fundamentally changed the flying experience, all based on producing safe and efficient transportation enabling people to get together around our world.

An Outsider's View

IW: A lot has been made about the fact that you came to Ford as an auto-industry "outsider." How steep was the learning curve for you?

AM: Well it's interesting. The similarities between the automobile industry and commercial airplanes are very striking.

They both are about safe and efficient transportation. They are very sophisticated machines.

In both industries, there is a strong emphasis on quality, fuel efficiency and safety. There are similarities in the technologies, the structure, the materials, the electronics, the aerodynamics, the avionics, the system integration -- in putting together the complete vehicle.

The distribution network worldwide, the suppliers, the global aspect -- all very similar.

And in both industries, large numbers of very talented people are working together around the world.

So it was very comfortable coming to Ford and not only contributing to great products but also helping to create an exciting, viable, growing company.

And of course I reached out to everybody in the industry when I first arrived to ask everybody their opinion about where the industry was, where it was going, what needed to be done. Especially including everybody on the Ford team -- engineering, manufacturing, operations, communications, legal, all of the talented people at Ford.

And it really helped get all of us to come together around a compelling vision for Ford, and a comprehensive plan to deliver that, and of course to work together to relentlessly implement that plan.

IW: The similarities notwithstanding, were there any advantages to having the perspective of a so-called outsider?

AM: I think there surely were. But I think the interesting thing was the fact that I had participated in and supported sophisticated and complex products that deliver safe and efficient transportation, and I had been associated with a business that dealt with a lot of harsh realities through the years -- like the ups and downs in the economy, and especially the terrible attacks on 9/11, which dramatically changed the commercial-airplane industry.

So I think it was a real plus having been doing this for 37 years. I think it was really helpful to the people of Ford.

'One Ford' Plan

IW: Which elements of the "One Ford" plan reflect your vision of the strategic direction for the company?

AM: I would answer that in terms of the big decisions that we made for the One Ford plan and the transformation of Ford.

And the first one was to pull everybody together -- everybody associated with the enterprise, our distribution network, our stores, our suppliers, all the Ford employees and UAW employees -- and come together on a compelling vision for Ford going forward, a comprehensive strategy and a plan to implement that strategy every week.

So including everybody was the most important thing.

Then second of all we decided to focus on the Ford brand, and as you know we divested a lot of the other brands that Ford had.

We also then decided to focus on a complete family of Ford vehicles -- small, medium and large, cars, utilities and trucks.

And we made a commitment that every vehicle we designed and created would be best-in-class -- in quality and fuel efficiency and safety, and in really smart design and technology like Sync and MyFord, and also the very best value.

And then the next significant decision that we made was that we were going to use our resources worldwide. As you know, Henry Ford had set up Ford in all the countries around the world ... but [Ford's operations] had become very regionalized.

So we decided that we were going to use all of our talents and work together to leverage all of our worldwide knowledge and operate as one team and one company.

In Part 2 of IndustryWeek's conversation with Alan Mulally, Mulally reflects on his accomplishments at Ford and looks ahead to the challenges and opportunities on the horizon for the automaker.

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