Ten Years After Ford’s Spectacular Turnaround, What Alan Mulally Reveals About Brand-Inspired Cultural Revolution

Guest post from Denise Lee
Yohn:

It’s been 10 years since Alan Mulally pulled
off what has been considered one of the greatest corporate turnarounds in U.S.
history.  HIs leadership of the venerable
Ford Motor Company’s recovery from the Great Recession of 2008 has been
celebrated and analyzed from many perspectives — the development of
industry-leading
products and partnerships with technology and consumer electronics companies, the revival of the Taurus brand, the consolidation
of global operations into a single business unit, etc.  But one angle that
hasn’t yet been covered is the
brand-inspired cultural revolution he led
inside the organization.

When Mulally arrived at the struggling company, he set his
sights on dismantling the toxic culture that had metastasized within it. In the
excellent book American Icon: Alan Mulally and the Fight to Save Ford Motor
Company
, Bryce Hoffman wrote about the lack of transparency, fractious business
units, and a preoccupation with self-preservation that had come to define
Ford’s culture. Meetings resembled mortal combat, Hoffman described, with
executives regularly looking for vulnerabilities among their peers to exploit.

Given the state of internal affairs at the company, it’s no
wonder the Ford brand was struggling on the outside. With its leaders
distracted by playing politics and defending turfs, the Ford brand had become
listless and unfocused. Ford’s product lineup hadn’t kept up with changing
consumer tastes and different regions pursued different automobile
configurations which diluted the brand identity around the world.

Mulally challenged this dysfunction head on and championed a
single, clear vision for the organization: 
“One Ford,”  With One Ford, the
company set about reviving what Mulally called the “phenomenally
powerful” Ford brand, promoting “the critical ingredients that made a Ford
a Ford.” and then working as one team to deliver on those, as a
Fortune
article
explains.

One Ford was grounded in the original purpose that prompted
Henry Ford to start the company—to “build a car for the great multitude.”  The resurrection of this vision conveyed to
everyone inside the company and out that Ford was back in the business of
“serving all around the world a complete family of cars that are
best-in-class,”
Mulally
explained
. With One Ford, he put the purpose and values of the Ford brand
at the center of the organization and unified the company’s people, plans,
operations, and products to restore the brand to automotive leadership.

He instituted weekly business performance review (BPR)
meetings that required a new level of rigor, scrutiny, and detailed analysis
from the company’s leaders. According to Hoffman, these executives initially bristled
at Mulally’s demands and resisted the changes, but over time they began to see
that the transparency Mulally enforced effectively united them to work together
on the company’s business and brand goals and that the commitment he expected was
not in service to himself but to the brand he had so much passion for.

Mulally also drove Ford’s engineers to define Ford’s “DNA,”
as Derrick Kuzak, Ford’s global product chief, called it—the “genome that was
designed to and engineered to convey quality, innovation, and style.” By identifying
“300 different characteristics—from the chirps on the electronic key fob to the
clunk of a closing door—that define the personality of its vehicles,” Ford developed
a common design language that made it easier to develop single products to sell
in all markets.  Moreover, it helped
build the Ford brand by making a Ford recognizable around the world and eliciting
a strong, visceral, emotional reaction to its vehicles.

All of these efforts worked to transform Ford — the
company was restored to profitability and the brand, to preeminence.. Within a
year, the entire organization’s energy toward the Ford brand had been
reinvigorated and executives throughout the company had begun to adopt Mulally’s
focused and data- driven approach. In 2010, Motor Trend named one of
Ford’s newest cars, the Ford Fusion, “Car of the Year.” And the company posted
annual profits of $6.6 billion, making it the most profitable automobile
company in the world at the time.

Ford’s turnaround demonstrates the transformative power of
an organizational culture steeped in an overarching purpose and integrated with
the brand. But more than that, it shows how leaders set the tone and pace of
cultural transformation.

 

Denise Lee Yohn is a
leading authority on positioning great brands and building exceptional
organizations, and has 25 years of experience working with world-class brands
including Sony and Frito-Lay. Denise is a consultant, speaker, and author of
What
Great Brands Do: The Seven Brand-Building Principles that Separate the Best
from the Rest
and the new book FUSION: How Integrating Brand and Culture
Powers the World’s Greatest Companies
.