US:First day for Mulally marks new Ford era - Ford Forums

Stacy94PGT · 10-02-2006, 05:31

First day for Mulally marks new Ford era
CEO expected to focus quickly on work at company

BY SARAH A. WEBSTER

DETROIT FREE PRESS BUSINESS WRITER

What's next at Ford?

• Alan Mulally officially starts as chief executive this week.
• In October, Ford starts its first wave of cutbacks for salaried workers. It will offer buyouts to higher-ranking managers who are 52 or older with at least 10 years of service. Those who accept will leave by Dec. 31.
• In November, the new Ford Edge crossover -- the company's most important new vehicle for 2006 -- hits showrooms.
• In December, two more buyout offers, which could appeal to lower-ranking managers and general salaried employees, will be made to workers. Those who accept either of those programs will leave by Feb. 28.
For Alan Mulally, the new chief executive of Ford Motor Co., today is Day One for Job One: fixing the suffering 103-year-old auto company that put Detroit on the map as the Motor City.

Already, his presence is shifting the mood in the executive ranks.

"It feels good," said Mark Fields, the automaker's president of the Americas. "I tell you, he's very, very positive -- very, very energetic."

Since Chairman Bill Ford appointed Mulally Sept. 5 to the CEO's post, the former Boeing Co. executive from Seattle has spent as much time as possible in Detroit, where he expects to eventually reside. So far, though, his time here has been intermittent. He even missed one of the company's biggest product launches this week at the Texas State Fair.

In an interview at the fair, Fields, who should be Mulally's most important deputy as the company tries to fix its money-losing North American operations, talked about how much he's looking forward to working on a team with the experienced CEO.

"He's got a hell of a lot of experience, which is applicable to our situation," Fields said. "He's at Ford Motor Co. because he wants to see this icon succeed. ... The other thing that's important, and that I sense, very, very palpably, is there's great chemistry between Alan and Bill, which is really important."

Ford insiders expect Mulally to begin his first full week with little fanfare and a quick focus on the difficult, hands-on work of turning around a company that has lost $1.4 billion in the first half of the year.

The company has vowed to shed 44,000 workers by 2008 and 16 plants by 2012 that the company doesn't really need. The company's recently revamped Way Forward turnaround plan also calls for freshening 70% of the Ford, Lincoln and Mercury lineup.

Already, Mulally has started a regular weekly business review with his leadership team, mostly vice presidents and above.

The meetings were a hallmark of his operational style at Boeing, where he is credited with turning around the commercial airlines division after it was pinched by revived competition from Airbus and sagging demand after 9/11.

Fields said a lot of business moves outlined in the Way Forward plan are already in motion.

"We're very, very focused on execution," he said.

Of the 44,000 job cuts coming, 30,000 will come from hourly employees. Most of those could be accomplished with buyouts. The other 14,000 will ultimately be from the salaried ranks, leading Ford to a massive evaluation of how work is done now and how it should be done in the future with one-third fewer workers.

"We're going through that process now," Fields said. "We look at it ... under a microscope and cut out the things that aren't relevant anymore or we can do more efficiently, and each of the areas is going through that right now."

Fields said the review is even getting down to which reports are compiled.

"Paste all the reports in a room, look at them all and say: What are the ones that really add value? ... Let's cut out 20% of them and see if anybody screams," he said. "It's almost that kind of granular approach."

Fields re-emphasized his desire to see fewer layers of separation between the upper management of the company and entry-level workers.

"I feel very strongly about that," he said.

Fields said he doesn't believe that will require the company to eliminate any of the six leadership levels at the company, but he was mum on questions about whether benefits might be cut more in the future.

Meanwhile, he added, some progress is being made on Ford's attempt to sell 14 plants and 6 other facilities formerly owned by Ford's spun-off parts supplier, Visteon Corp., and now held under a Ford subsidiary, Automotive Components Holdings Inc. Ford has taken some lumps for not selling any of the assets over the past 11 months, since the subsidiary was created to close or sell the plants.

"These are complex transactions," Fields explained. "We're closer than we were."

The most important strategy in motion, Fields emphasized, is the launch of new products. Besides the new Super Duty, which will be available in showrooms in early 2007, a new Ford Edge crossover will hit the market later this year.

"Every launch is going to be important going forward, because this is a product-driven turnaround and I don't want that to be a sound bite," Fields said.

"It's very important for us as we go forward to get off our back foot, and that means being very proud and confident about the products that we make. That's what's going to put this company back on its feet."