Forget all that fancy, modern business theory: Henry Ford taught the automobile industry all it needs to know for the 21st century, says Richard E. Dauch.
What made Ford so revolutionary that his lessons should be relearned? For Dauch, just three things: the assembly line; the $5-a-day wage; and a reliable, affordable product.
In other words, 'Organize your work, motivate and inspire your people and produce a great product,' Dauch, CEO of American Axle & Manufacturing Inc., told the Automotive News World Congress.
Industry basics are changing so rapidly, he said, that it has the feel of a mild earthquake. 'It keeps the ground shifting and swaying and sliding out from under your feet and you get a little queasy in the gut, and you are never quite sure what is coming next.
'DaimlerChrysler - who would have thought it? Nissan and Renault, strange teammates ... Ford with Volvo.' As for auto parts makers, 'Who would have thought that ITT would abandon the auto industry? Or United Technologies? And who ever heard of Meritor - or American Axle for that matter?'
But the forces of change are not new with the new millennium, he said. 'At the turn of the century, there were more automakers within a half-day drive of where I'm standing than there are in the whole world today.'
The industry's consolidation, he said, is not a measure of failure but an acceptance of economic reality. It means shedding weaknesses, leveraging strengths and teaming up to go global.
If those challenges were not enough, he said, the automakers are impatient for changes.
The former Chrysler Corp. executive said he made a list on the back of an envelope of the 22 things a company must do in order to survive the industry today. He listed 'technology, because if you fall behind, you are doomed.'
He added globalization, core competencies, logistics and critical mass and e-commerce.
Dauch said he considered all 22 items as he rebuilt five spun-off General Motors plants into American Axle, now the world's second-largest maker of axles and driveshafts, after Dana Corp.
But, he said, success came from three fundamentals.
'They are the same three that made Henry Ford famous,' he said. 'If we do those simple things, then embracing the new millennium will be easy. All you need is the courage to forge change.'