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In: Business and Management

Submitted By bibo
Words 2449
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Alan Mulally, who was hired as CEO of Ford in September 2006, had not engineered, designed, or built any cars. He came from Boeing. After joining Ford, he devised a plan that identified specific goals for the company, created a process that moved it toward those goals, and installed a management system to make sure the company reaches those goals. Mulally demands weekly, sometimes daily, updates. “Alan's style is pretty relentless,” says chief financial officer Lewis Booth, a 31-year Ford veteran. “He says, ‘If this is the reality, what are we going to do about it?' not ‘We're going to work our way through it.'”

Mulally's leadership has resulted in Ford making some strategic moves. When Mulally arrived in September 2006, Ford was known mainly for its pickup trucks and the Mustang. The company was on the verge of financial collapse. It lost $12.6 billion in 2006 and another $2.7 billion in 2007. Sensing a recession in 2006, Mulally decided to borrow $23 billion against Ford's assets. Taking on more debt wasn't easy, but the extra cash meant that Ford could say no to government loans when sales declined in 2008 and 2009. He wants Ford to maintain its independence.

Mulally is moving to integrate the company globally, despite several failed attempts in the past. In 2010, Ford will be selling small cars (e.g., Fiesta and Focus) in the United States that were developed in Europe. Mulally persuaded Bill Ford to sell off Jaguar and Land Rover and focus its resources on the Ford brand. He sold Jaguar, Aston Martin, and Land Rover to India's Tata in 2007 when there was still a market for makers of luxury vehicles, and he has been trying to sell Volvo. Mulally felt that these cars were a “dangerous” distraction from Ford's core business. Mulally believes that fewer models mean better economies of scale and significantly improved profitability.

Mulally's decisions have…...

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