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Authors: Bryce G. Hoffman
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North American automobile business, compared it to the company’s far more successful operations in other parts of the world, and tried to figure out what they needed to do differently to stop the long decline in Ford’s home market. Key elements of the plan were lifted from the recent turnaround of Ford’s Brazilian subsidiary. Others were inspired by the progress Ford was making in Europe.
On November 14, a company holiday, Fields and the senior members of his team came into the office and spent ten hours fine-tuning the details, agreeing on targets and gut-checking one another’s assumptions. When they were satisfied they had gotten it right, they began writing it up for the board of directors. Fields called it “The Way Forward,” borrowing the Churchillian phrase from a documentary he had watched on the BBC before leaving London. The Ford plan called for idling fourteen factories in North America, including seven assembly plants, by 2012. Closing them would require UAW approval, so that would have to wait until the next round of contract talks. Between 25,000 and 30,000 factory jobs would also be eliminated. Fields hoped to take out about half of these through attrition, the rest through voluntary buyouts that would also have to be negotiated with the union. In addition, Ford would cut another 4,000 salaried positions and reduce the number of corporate officers by 12 percent. Fields set a goal of shedding $6 billion in material costs by 2010 and aimed to reduce Ford’s North American manufacturing capacity by 26 percent over the next three years.
But as Bill Ford had said in September, the company could not cut its way back to success. It also needed to reconnect with consumers. Using the same approach to demographic research employed by political operatives in election campaigns, Fields’ marketing task force figured out who was most likely to buy Ford’s products, who was least likely, and who was still willing to be convinced. That research revealed that most American consumers wanted to buy an American car or truck—far more, in fact, than the roughly 58 percent of them who had purchased a Ford, GM, or Chrysler product the previous year. The catch was that they wanted those vehicles to be every bit as good as the ones being sold by Japanese automakers. Ford would have to redouble its efforts to improve quality in order to meet their expectations, but Fields saw this as a huge opportunity and was determined to seize it. Rather than trying to beat the Japanese at a game they were already winning or out-Korea the Koreans, he wanted to take Ford somewhere those other companies could not follow. To do that, Ford’s products needed to do more than just say, “Made in America”—they needed to stand up and sing “The Star-Spangled Banner.” Instead of inoffensive appliances, he wanted beefy rides with in-your-face styling that were chock full of innovative features.
Fortunately for Fields, the company had brought in an Englishman to lead a reimagining of Ford’s North American product lineup two years earlier. Though he favored tweed suits and ordered his beer by the pint, Peter Horbury shared Fields’ vision of what Ford should and could be. * His designs were inspired by things like Conestoga wagons and U.S. Navy fighters. He was determined to capture the American zeitgeist in sheet metal. And he had the ideal flagship for the new Ford—a crossover utility vehicle called the Edge—nearing completion in his design studio.
Fields called this new approach “Red, white and bold.” He ordered blue rubber bracelets imprinted with the slogan and passed them out to the other members of his team. He made it clear that these werenot optional fashion accessories. Soon they were being distributed throughout the company. Fields was big on slogans and symbols and vowed not to remove his bracelet until Ford’s North American business was profitable again. *
Fields presented his plan to the board on December 7,
On November 14, a company holiday, Fields and the senior members of his team came into the office and spent ten hours fine-tuning the details, agreeing on targets and gut-checking one another’s assumptions. When they were satisfied they had gotten it right, they began writing it up for the board of directors. Fields called it “The Way Forward,” borrowing the Churchillian phrase from a documentary he had watched on the BBC before leaving London. The Ford plan called for idling fourteen factories in North America, including seven assembly plants, by 2012. Closing them would require UAW approval, so that would have to wait until the next round of contract talks. Between 25,000 and 30,000 factory jobs would also be eliminated. Fields hoped to take out about half of these through attrition, the rest through voluntary buyouts that would also have to be negotiated with the union. In addition, Ford would cut another 4,000 salaried positions and reduce the number of corporate officers by 12 percent. Fields set a goal of shedding $6 billion in material costs by 2010 and aimed to reduce Ford’s North American manufacturing capacity by 26 percent over the next three years.
But as Bill Ford had said in September, the company could not cut its way back to success. It also needed to reconnect with consumers. Using the same approach to demographic research employed by political operatives in election campaigns, Fields’ marketing task force figured out who was most likely to buy Ford’s products, who was least likely, and who was still willing to be convinced. That research revealed that most American consumers wanted to buy an American car or truck—far more, in fact, than the roughly 58 percent of them who had purchased a Ford, GM, or Chrysler product the previous year. The catch was that they wanted those vehicles to be every bit as good as the ones being sold by Japanese automakers. Ford would have to redouble its efforts to improve quality in order to meet their expectations, but Fields saw this as a huge opportunity and was determined to seize it. Rather than trying to beat the Japanese at a game they were already winning or out-Korea the Koreans, he wanted to take Ford somewhere those other companies could not follow. To do that, Ford’s products needed to do more than just say, “Made in America”—they needed to stand up and sing “The Star-Spangled Banner.” Instead of inoffensive appliances, he wanted beefy rides with in-your-face styling that were chock full of innovative features.
Fortunately for Fields, the company had brought in an Englishman to lead a reimagining of Ford’s North American product lineup two years earlier. Though he favored tweed suits and ordered his beer by the pint, Peter Horbury shared Fields’ vision of what Ford should and could be. * His designs were inspired by things like Conestoga wagons and U.S. Navy fighters. He was determined to capture the American zeitgeist in sheet metal. And he had the ideal flagship for the new Ford—a crossover utility vehicle called the Edge—nearing completion in his design studio.
Fields called this new approach “Red, white and bold.” He ordered blue rubber bracelets imprinted with the slogan and passed them out to the other members of his team. He made it clear that these werenot optional fashion accessories. Soon they were being distributed throughout the company. Fields was big on slogans and symbols and vowed not to remove his bracelet until Ford’s North American business was profitable again. *
Fields presented his plan to the board on December 7,
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