Mark Fields was a fast-rising star when he announced Ford Motor Company’s Way Forward plan in January 2006. When I interviewed him a few months later, Ford’s president of the Americas, clumsy as his title seemed, was already on his way to the top as a potential replacement for Bill Ford, Jr., as chief executive officer.
“I love the car business,” the Harvard MBA told me in an interview published in the August 2006 issue of Motor Trend. “I have always been driven by huge challenges, by things that need to be improved significantly. My parents always taught me to be my best, to be competitive, but not in a way that climbs over people. Love the business and the challenge.”
Wall Street didn’t think much of The Way Forward, because Fields in that January presentation spoke of layoffs, material cost cutting, and plant shutdowns, with few specifics on how the automaker planned to balance all this with innovation and new product.
Ford hired Boeing executive vice president Alan Mulally to replace Bill Ford Jr. as CEO that September. By now, chief financial officer Don LeClair was arranging the company’s $23 billion “home equity loan,” which would ultimately spare it from the Troubled Asset Relief Program that bailed out General Motors and Chrysler LLC.
The Way Forward did, indeed, have substance, although it took Mulally’s nascent leadership to draw it out and present it clearly to the press and public. Months into Mulally’s tenure, Ford insiders offered off-the-record praise for the way the outsider CEO changed the corporate culture and cleared out the time-consuming BS and CYA that permeated too many executive meetings.
The most important change Mulally implemented was the way Ford invested in constant updates and improvements to its existing lineup. Cars like the 1986 Taurus and 2000 Lincoln LS had good launches, then aged quickly and died on the vine.
Under Mulally, the 2006 Fusion received a major facelift for 2010 and, by the 2013 model year, had been replaced with the current model. There were likewise significant updates for the Taurus and Mustang. Even the mediocre U.S. Focus got an important new technology, Sync, as Ford prepared the all-important 2012 Focus.
If most of this was in place before Mulally’s arrival, we must give him credit for its implementation. Ford and its rivals have been promising such changes for decades, but few – and especially not Ford – delivered. Mulally’s overused public relations phrase for his determined approach is that the company remains “laser-focused.” (Chief executives rarely make for creative extemporaneous speakers.)
Mulally’s individual accomplishments at Ford are likely to manifest themselves months, even years after his July 1 retirement. Of course, there’s the aluminum-bodied Ford F-150 coming this fall, and we’ll be well into 2015 before we know whether traditional pickup buyers accept the lightweight truck.
It will be up to Mark Fields to maintain Ford’s propensity for frequent, costly upgrades and updates to its mainstream lineup. Mulally cautioned Wall Street at the beginning of the year that Ford’s net profits will be much lower than its 2013 net income of $7.2 billion, largely because of a slew of new products in 2014.
Though Ford’s sales are good and profitable, and public perception is high, Ford’s quality numbers have taken a hit for the company’s over-reliance on Microsoft-based Sync and MyFordTouch, and the EcoBoost engines have been criticized for failing to provide both Eco and Boost at the same time. For enthusiasts, Ford has become a predominantly front-wheel-drive company, the big trucks and the halo Ford Mustang the sole exceptions. I don’t think Lincoln will get a sedan based off the new Mustang platform. As the advent of the autonomous car quickly approaches, this is not a bad position for Ford’s new CEO.
Overall, holding off Fields by eight years for the Big Job turned out to be the right plan. He surely would have not had the guts or the clout of the well-seasoned outsider to spend the money on product. Even though Fields is a Ford lifer, Mulally leaves him with the imprimatur of being a Mulally protégé. Fields will deviate from that course at his peril.