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Rod Meloni blog: Next chapter begins at Ford Motor Company

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DETROIT – In Detroit, automotive executive succession is no joke, but we in the automotive press can’t help but have our little inside baseball humor. So here goes: What was the difference between now former CEO Mark Fields and GM CEO Mary Barra? Answer: Bill Ford! While perhaps droll, this gets you to the heart of what happened last Friday at the Ford World Headquarters. The guy with the name on the building asserted his power, the truly executive chairman.

Bill Ford Jr. knows what he wants for leadership style, knows he represents his family’s interest in the company, and when he and the family get uncomfortable, he acts. The point to the joke: Mark Fields was Ford CEO only. On the other hand, over at GM, Mary Barra is chairman and CEO, which means while her name isn’t on the building, she is fully in charge. It’s largely her board of directors. She calls the shots, unless and until her board decides it’s time for her to ride off into the sunset.

Her toughest jobs outside of profit and loss [which is never easy] is convincing shareholders and Wall Street she is the right person to forge a more profitable future where “mobility” will be central to staying relevant to customers. Mark Fields knew he bore all the responsibility. Bill Ford had all the power. Therefore his relationship with Bill Ford was the key to his success. Obviously that relationship soured. A $10 stock price didn’t help.

Bill Jr. said he discussed it with Fields Friday and together they decided it was time for Fields to go. What exactly happened to the relationship is the news story to be ferreted out in the days and weeks to come. Rest assured, though -- while it is claimed Fields retired, he didn’t.

Now, to give Fields his due, he earned the job and by all accounts did a good one in his first couple of years. He delivered the aluminum-framed F-150, the Ford GT and record profits. Ford compensated handsomely too. Last year he cleared more than $22 million. Still, Fields knew from day one piloting the company from the big chair represented an uphill slog.

First and foremost, he had to know the old Hollywood bromide: never follow a legend. Bill Ford brought in Alan Mulally from Boeing largely because, while Fields was the young heir apparent the time, he wasn’t ready. Books written about the automotive downturn of 2008-2009 told the story of how Fields nearly had a fistfight with the head bean counter in an executive planning session. That led Bill to suspect Fields needed more seasoning and maturity. Ford also felt Fields needed a mentor.

Fields had ably served Ford as its wunderkind, its turnaround guru who fixed the Japanese operations, jetted across the globe to Europe and was fixing that mess when the home office called to bring him to Dearborn and work his turnaround magic at the mother ship. It was his turnaround plan Mulally executed, and it worked brilliantly.

But Mulally had that special something, that salesman’s "it," or you could call it likability. Mulally could make you feel as if you were the only person not only in the room but in the world. You wanted to be around him because he was having fun and he was mightily effective and successful in so doing.

Upon his arrival in the darkest of days, they gave him a standing ovation. When he left, employees gave him a standing ovation, and many cried because they were going to miss him. Monday when Ford employees left the briefing to meet Jim Hackett, he received the ovation, and there wasn’t a tear anywhere for Mark Fields.

It’s not like it was a secret Fields was, to the core, that hard-charging automotive turnaround guy. In covering the business world the last 22 years I have learned there is a distinct difference between turnaround and operational executives. It’s not that Fields was humorless. It’s just that you have to ask, "Who likes the guy who says we need to cut to the core?"

Raise your hand if you like the guys and gals who make the trains run on time? No one! Those executives are absolutely necessary at times, but colleagues usually prefer the ones who make them feel comfortable, give them hope for the future and also give them reason to run through walls of fire for the company’s greater good. Fields could deliver on the profits, just not the inspirational warm fuzzy.

In searching for the clearest indication of why Bill Ford decided it was time for Mark Fields to step down, Bill told us this story. Last Friday after a bruising session with the Ford Board of Directors where Fields clearly didn’t offer any kind of plan that gave members future confidence Bill Ford Jr. said, "We need faster decision-making. We have to empower the teams. Jim’s all about that and we have to trust our people to move fast, and so it’s not command and control."

Ford wasn’t mincing words. Fields had allowed the company to backslide into some of its former bad habits, individual business silos where decision-making wound up paralyzed, of executives being loyal to the executive their wagon is hitched to more so than the company. Another Fields sin Ford acknowledged: the company needed to “improve operational excellence," code for "we’ve had a lot of recalls lately and that can’t stand." Exit Mark Fields after 28 years.

OK, so "who is the new guy and why do I care?" you ask. Well 62-year-old Jim Hackett is a physically big guy, former University of Michigan football player under Bo Schembechler. As so many of Bo’s players did, he went on to considerable success. He rose to the top of Steelcase Furniture near Grand Rapids and spent 20 years as CEO.

Bill Ford Jr. said Monday what got his attention was the fact that Steelcase became the No. 1 office furniture company globally not because its seats were more comfortable or the file cabinets more spacious.

He said, "Jim took a company that defined itself as a furniture maker and Jim said no, let’s imagine the future of the workplace. Let’s imagine how people are going to work and want to work in the future then let’s build our company around that."

Yes, profits still mattered, operational issues were still important, but the vision of why the company existed beyond profit is the heat that creates the steam of success. About four years ago, Bill asked Hackett join the Ford Board of Directors got to know him better.

One surprise came when Silicon Valley executives meeting the Ford Board knew who Hackett was, greeted him warmly and relayed to Bill just how impressed they were he had Hackett on the Board. They said he was special and respected him as a thinker.

Then, after Jim took the helm of the badly limping University of Michigan Athletic Department, signed a massive and lucrative deal with Nike and then brought Jim Harbaugh in from the San Francisco 49ers to coach the Michigan Wolverines football team, he’d poked another impressive feather in his cap. Turnaround accomplished, excellence with a new vision attained, yet again what’s not to like?

So last year, Bill Ford hired Jim Hackett to head up the new Ford Smart Mobility LLC and he reported to Mark Fields. So when it was clear Ford needed a new leader, Bill Ford Jr. looked around and saw he already had in house the person with the talents, history and visionary leadership he wanted. Thus on Friday Hackett said yes to the CEO job. Hackett said he asked Bill Ford Jr. to take two tasks onto his plate, at least in the beginning.

He wants Bill to deal with government relations and communications at least in the beginning. Hackett says he needs time to get the teams he wants in place and operating well. Hackett also walked back a lot of the talk surrounding the decisions made about manufacturing in Mexico. He said they were all business based decisions and politics had nothing to do with it. So, there you go -- Mark Fields' photo ops outside the White House get walked back on day one.

It’s a new day at Ford Motor Co., again. Bill Ford Jr. remains the executive chairman, his new CEO knows the score and his responsibilities. There is a sizable cadre of experienced auto talent getting bigger jobs in this transition to help Hackett succeed. But if it goes south, the company remains ready to move once again if necessary.


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