How to Replicate Alan Mulally’s Corporate Alignment Success
When Alan Mulally took over as CEO of Ford, he knew immediately that he had an alignment problem in the company. Mulally built a strategy called “One Ford” and aligned the massive organization around it. In doing so, he demonstrated a mastery of key leadership actions that both energized workforces and drove sustained results.
May 16 2014 by Tony Rutigliano
Alan Mulally often tells the story of his first day as CEO of Ford Motor Company. He pulled into the parking lot and saw not one Ford vehicle, but Jaguars, Land Rovers and Aston Martins—brands which, at the time, were all owned by Ford. Mulally wondered, “What are all those people working on? I don’t think it’s Ford cars, and that’s 85 percent of the business.”
Mulally knew immediately that he had an alignment problem in his company. Ford had 97 different models, making it impossible to have a laser focus on what the brand stood for and what its customers could expect when they walked into a showroom.
Mulally built a strategy called “One Ford” and aligned the massive organization around it. In doing so, he demonstrated a mastery of key leadership actions that both energized workforces and drove sustained results:
Tapping Into a Higher Purpose. Grounded leaders like Mulally understand that employees —and other stakeholders—can be inspired and feel more enriched when they pull together for something greater than themselves. People don’t run into burning buildings or charge up hills to save budgets. We find the capacity for heroic action when we want to help others. When individuals at work pursue more than simply a livelihood, they fulfill a quintessential human need to contribute to the community of their fellow human beings.
Defining the Blueprint for Success. Once this inspirational “why,” or purpose, is established, it is essential to define the blueprint for success, including strategies and metrics on how to get there. It’s also critical to support and drive the agenda with an always-humming communication network binding people together and renewing and supporting their commitment.
Forging a Shared Direction. When Mulally first gathered his top executives for a status report, he quickly became familiar with the team’s simple rating system: green for good, yellow for trouble, and red for failing. He was astonished when he saw that the company’s projected losses were $17 billion, yet all the charts showed green. Mulally worked hard to get people to talk about what was really going on at the company. It took repeated meetings before employees understood that honesty would not cost them their jobs. Eventually, when one manager shared an all-red chart, it opened the floodgates for honest communication upward and across the organization.
Mulally showed his executives that the only way they could win the battle for Ford was as a team. “Every week, we would look at all 320 charts and know what needed attention,” he said. “So, during the week, everybody would try to figure out how to help one another so they could turn a red to yellow or a yellow to a green. It was almost like a celebration.”
Unleashing Human Potential. Through those many executive team meetings, Mulally encouraged his colleagues to be generous with their time and ideas. He showed them that by being authentic and vulnerable with their teammates, they would actually become more powerful and effective at their jobs.
FOLLOWING MULALLY’S STRATEGY
To create a climate that fully taps into your employees’ abilities and passions:
Pay attention to perceptions. Let people know that what they are doing is important and that they possess qualities that can make them outstanding performers.
Get the right people in the right jobs. People will succeed when leaders consider their unique talents and take the time and trouble to put them into positions that showcase their abilities.
Ensure that leadership is personal. Don’t confuse “messaging” with “communication.” Talk with your colleagues, not at them. Don’t be afraid to reveal your personal side and your emotions. Be as open, honest and real as situations allow.
Creating and sustaining alignment takes tremendous attention, work and adjustment. Remember it is not just a matter of goals, strategies and tactics. It is also about putting your company’s values to work through your culture and your people.
Tony Rutigliano is president of Healthy Companies, a leadership consulting firm. Note: Health Companies CEO interviewed Alan Mulally while researching HC’s Healthy Leader Model.