Ford Motor Co. CEO Bill Ford's retooled revival plan for the company founded by his great-grandfather is taking shape with changes in the way the automaker develops vehicles and works with its suppliers. To be successful, Ford Motor also must alter its culture to accept the changes.
Global purchasing chief Tony Brown's plan to reduce the number of Tier 1 suppliers working with Ford is long overdue. Ford Motor intends to work collaboratively with the remaining suppliers rather than resort to painful, price-driven negotiations for every component it buys.
Brown's plan is similar to a system Toyota Motor Corp. has used to build strong, productive relationships with its suppliers. Parts makers respect Toyota; they don't resent the company. As a result, Toyota is a beneficiary of supplier innovation. Ford Motor's new program can work that way, too, if the purchasing staff is motivated and compensated in a way that encourages collaboration.
It also will make it easier for Phil Martens, Ford's North American product development chief, as he recasts his operation in the image of Mazda's product development process. Martens and Mark Fields, who now heads Ford's North American operations, were colleagues at Mazda when the Japanese automaker revamped product development.
The result was a system that develops hot products quickly. The system can work for Ford, too, if Martens can coax the organization to change. Most organizations resist change, and the Ford organization has a history of rejecting outsiders and rejecting change, even if it comes from within.
Benchmarking successful purchasing and product development systems is a good start to this phase of Ford Motor's revitalization -- if the changes are implemented quickly, efficiently and permanently.