The Turnaround at Ford Motor Company

This case describes the corporate turnaround of the Ford Motor Company under the charismatic leadership of Alan Mulally. Ford was in deep trouble in the early 2000s as its prices and debt ratings plummeted and employee morale suffered. In 2006, the company anticipated a loss of $17 billion. Ford’s declining product quality and lackluster designs led to declining sales. Moreover, the company struggled with a dysfunctional, ego-driven corporate culture. External factors like rising oil prices and raw materials costs also posed problems. To address these widespread challenges, Bill Ford, then CEO of Ford and great-grandson of Henry Ford, recruited Alan Mulally from Boeing, who had turned around that company in the wake of the 9/11 attacks. Mulally developed and implemented an ambitious transformation of Ford; his plans included instituting accountability among senior executives using a data-driven approach that eventually trickled down to frontline employees and simplifying Ford’s product line, portfolio of brands, and organizational structure. The sweeping restructuring and culture change allowed Ford to once again, become a profitable automaker.