Leach: A strong brand identity takes balance

Martin Leach, Ford of Europe’s product development chief, spoke with Staff Reporter James B. Treece at last month’s Frankfurt auto show.

What is Ford’s view on sharing platforms?

The internal perspective on cooperation has really moved from one of this platform definition to one of sharing technologies. There are different types of synergies available. One is the engineering and systems. Another is the opportunity for cost reduction.

What we’re basically doing is wrapping a whole infrastructure concept around the ability to interchange what we do, as opposed to being prescriptive and saying, “Look, everyone shares this platform.” That’s because there’s evidence out there in the marketplace of people going too far in sharing and vehicles becoming too similar in character.

One of Ford’s underlying strategies is to have strong global brands. To do that, each brand must have its own unique, distinctive character.

How did you develop your thinking on this?

(He picks up a Coke can.) Imagine that this is a system that fits into a vehicle. Call it a brake system. Previously, we would have had two of those. Now we might not only have one, but if we have one, we have one that maybe offers 10 percent more performance than the outer performance limit. That can be scaled, leveraging all the basic understanding and knowledge and infrastructure from developing the original entity itself. That is a lot more efficient than starting with two. That gets you efficiencies in development; it gets you knowledge transfer, institutionalized learning and things like that — all of which is very important.

If you’re producing this one in Japan and that one in Europe anyway, there are maybe not the same synergies of production. So what you’ve done is maximize the synergy effects, recognizing the real world. If you’re producing them together, then the objective is to go for more of a common solution. But it’s really looking at this on a product-by-product, system-by-system, technology-by-technology basis.

It sounds like that would delay the cost savings more than just by saying, “Here’s a platform, use it.” The Mazda platform is available.

I think that’s because we’re trying to manage both pieces of the equation simultaneously. Having strong brand identities is about managing the revenue side of the business. What we don’t want to do is only manage the cost side, and suboptimize the revenue side and therefore suboptimize the business as a whole. So it’s very much a balancing approach.

When Mazda says it is the “center of excellence” for the C/D platform, what does that mean in this context?

Mazda should answer that question, but it’s about fundamental learning, understanding, knowledge transfer, rather than Mazda designing all of the components or Ford designing all of the components.

Where do you see the cooperation between Ford of Europe and Mazda going?

I think there are synergies going both directions. I would agree with the premise that because of pressures like fuel economy, pressures on the size of vehicles, there would appear to be naturally more synergy opportunity between Japan and Europe or between Asia and Europe. As we said when I was at Mazda, we had a long-term strategy to work on reciprocal development and sharing of technologies between Mazda and Ford. That is proceeding, and we’ll start to see the fruits of that increasingly from next year onward.

What is Ford of Europe the “center of excellence” for?

Certainly within our own development portfolio, we’re leading on the whole diesel family within Ford Motor Co. We are presently developing new technologies for small mid-sized cars, the underpinnings to produce a supermini-sized car or mid-sized car. We also have a very strong capability in vehicle dynamics and noise, vibration and harshness. We work with all the companies on those vehicle attributes.

Mazda has faster — and cheaper — development times than Ford of Europe. What are you doing to transfer that know-how?

I contest the second point.

Is it possible to take longer and spend less money? There’s a function of engineering man-hours.

I’ll explain why I don’t see it exactly the same way.

When I came back to Europe, I had established the world’s record for the fastest-ever time-to-market with the new Mazda Premacy — clean sheet of paper to start of production in 23 months. I couldn’t deny the reality of fast cycle times. So I challenged my team to achieve a 50 percent reduction in time-to-market. Time-to-market is defined as from the idea to actually implementing it.

You say 50 percent. Can you give some numbers?

No, but that would put us basically competitive with Mazda.

With Mazda’s standard as opposed to its best efforts?

For time-to-market, I think you need to look at the total system rather than a specific instance.

There are two major phases that have to occur. One is the product-creation phase and the other is the product-realization phase. Mazda is very fast in terms of the product-realization phase. I have a team working on transferring that know-how, adapting it to the European operating environment and achieving a dramatic reduction in time-to-market.

On the other area, the product-creation phase, I put in two new groups within the organization: the design strategy group and the advanced products group. We’ve been populating them with some personnel from Mazda. The idea being that we have a think tank, an idea-generation forum, and speedy decision making. So we’ve been working on what it takes to speed up the decision making. It’s one thing to take a long time to do something when you’ve decided you want to do it. It’s another to take a long time just making your mind up. We could see that there were issues in both areas, frankly. So I had to address both parts of the business.

You can reach James B. Treece at jtreece@crain.com

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