Why “One Ford” is One Good Idea

(and what others can learn from this vision):

There is no hiding the fact that after 100+ years Ford Motor Company became a huge collection of separate “chimney’s”, functions and area’s of expertise.  Even within a geographic region (ie Americas, Asia Pacific or Europe, etc) and individual functions there have been, and still are, obvious divisions of power, culture and prejudices.  It is inevitable that with continued success over the years, autonomy and decision making was pushed to those closest to each market.  Unfortunately, to sustain this autonomy, huge amounts of resources (particularly headcount and workload) have been required and core processes simply diverged over time.  It isn’t until we are forced to “remake ourselves” that we find the excuse and momentum to breakdown barriers that exists to transform our business model.  One of the best examples of a beneficial transformation in process is with Market Representation in the U.S.

Note:  Market Representation is the function of franchising dealerships to represent specific brands under specific terms.  A franchise transaction includes everything from Appointments, Approval of Buy-Sell Agreements (corporate or asset purchases), Ownership Amendments, Terminations, Resignations, Relocations, Additional Place of Business and a host of auxiliary contractual examples.

I was blessed to witness the partial dismantling of one of these legacy processes when I accepted the role of the Dealer Contracts Manager for Ford-Lincoln-Mercury in 2007 to lead the consolidation of Market Representation.  At that time, we were forced to radically reduce the headcount in the field.  Prior to this consolidation, all of the processing of every franchise transaction was locally developed, documented and presented to the general office by field personnel.  Unfortunately, this was not only cumbersome given the legal and historic precedence of each office, but it was inconsistent nationally as every market interpreted policy and requirements differently.  It is also true that the requirements of many transactions were redundant and needed to be re-engineered.  It wasn’t that any one region was incorrect (although disparity of quality between them was extreme), but it was simply impossible to streamline or automate dozens of variations of the same transaction.

After a deep dive into every possible transaction variation, we simply documented the best combination of processes and developed a step by step guide that would help streamline each transaction.  While there was considerable pushback and most of the players were resistant to change (I was one of them), the benefits of centralization slowly began to evolve.  As the expertise of those handling the transactions improved, the field became more efficient and better able to redeploy their valuable time with face to face interactions with our customers (dealers).  The field became less intimidated by the fact that their transactions would be processed by someone in a central office and they slowly adopted the modified process.  This became a huge WIN for the field and the Company because we truly consolidated a cumbersome process and eliminated hours of redundancy that ultimately elevated the field.  The manpower savings was enormous, but the real win was in the inevitable shift in mindsets that we really are one team.

Each of us want to believe our situation is unique and we justify the status quo for a variety of reasons.  When in reality we are better served as a member of a larger team with aligned goals.

This is less a reflection of a single project as it is an endorsement of the vision of having everyone on the SAME TEAM.  While there are benefits of parochial thinking, the freedom of dispersing the work and re-engineering our processes to include everyone on the team is greater.  I am confident the synergies we experienced in the US are only the tip of the iceberg as their are numerous activities within Marketing & Sales throughout the world that would benefit from ONE vision and a common process.

Our normal year end financial review brought about a disappointing revelation.

Homeowners Insurance

It seems that our home owners insurance premium went up a couple of percent and it struck me as odd since the housing values in Michigan have plummeted 50% this year.  It forced me to take a deep dive into something I considered a fixed cost and yet saved myself a small fortune in the process.

To make this long story short, just know that I have owned 8 different homes in different States (all through relocations with my job) since 1983 and we have been with State Farm Insurance for our homeowners coverage with every one.  We have NEVER had a claim, even when we have had small mishaps that might have been covered.

It has been our misguided belief that our loyalty to our insurance provider (or phone provider or bank lender or whatever) resulted in a favorable rate and treatment and there was never any cause to shop around as long as it wasn’t “broken”.

Boy was I wrong!

I decided to call GEICO (since I’ve grown to be a fan of Warren Buffet) to compare coverage and rates.  Much to my surprise, they cut my bill in half!

Believe me, I was a skeptic until the lady on the other line of the phone walked me through all the details.  They did a line item by line item comparison of every particular of my home (foundation, construction, fireplaces, moldings, basement types, roof types, patios, etc) since the home was built in 1936 and has had multiple enhancements along the way.

Loyalty

It turns out that they RAISED the amount of coverage by about 10% since the replacement costs exceeded the present selling value and kept my deductible the same…and still cut the bill in half!

My skepticism became elation….then my disappointment (almost anger) of being over charged for 20+ years for blind loyalty set in.

It’s a mistake I won’t make again.

It seems vendors/suppliers/companies that have long term relationships with you are easily tempted to take you for granted.  It seem nuts to me that a cable tv supplier or cellphone provider can give a new customer the same service as an existing customer (one that may have been with them for 20 years or more) at half the price….but it happens every day.

Value doesn’t always come looking for you.  You must go find it and then continuously benchmark it as time evolves.  Nothing stays the same.

How about you?  Have you found a better deal than the one you had been using for years? In a time of financial duress, we might all benefit from each others stories.

Next Deadline:  1/9/10

One of the first questions I’ve asked myself when setting this blog into motion was “who in the world would ever take the time to read what I wrote?”

I’ve never been drawn to anything quite so narcissistic as a public diary (my original understanding of a blog) and my life is a tad bit boring (as my teenage kids will readily attest).  Yet, the more research I read on the art of penning one’s own blog, the more I feel compelled to try.

Clearly, my initial “pre-postings” were, at least, interesting for those that are close friends and family as they dealt with a number of personal issues.  The diversion from a normally secretive persona made the entries dealing with my physical recovery after an accident something to talk about.  Even if we’ve never met, most people can relate to injuries that require time to heal.  I was glad to get it all out of my system (so to speak) and it serves as good background for those that might find it interesting to watch how this blog has progressed.

I have been told by some colleagues that they are looking forward to some “dirt” on the Company we work for.  Unfortunately, this will never occur.  Aside from the water-cooler talk,  I have no interest in memorializing how close my corporate life is to the Dilbert comic strip.  Besides, there are plenty of other sites that rant on with automotive or employer bashing…we don’t need another.

Instead, I simply chose to document and follow a few of my own passions in a public forum.  Perhaps over time, this will reveal part of a transition I’m unaware of at the moment.  Nevertheless, I am compelled to find my own rhythm of starting the conversation.  I hope  that the more people I make aware of this site, the greater the chance we can actually have dialogue.  I continue to experiment with the “comments section”, but I clearly have hopes that I am successful in engaging readers along the way (or at least provoking a reaction).

So what can you expect to read and why should you tune in?

I hope to entertain you (at the very least).

My commitment to transparency quickly exposes the fact that I am simply a happily married, middle-aged, corporate grunt, father of 3 wonderful kids in college or high school.  I deny that I am going through any mid-life crisis (my kids joke that I must be) and I have no experience as an author of anything outside of grad school or work related activities. But after you get over my self-effacing boorish chatter, it will surprise you to learn my interests are…..well, interesting.

I promise to keep my postings short (600-800 words max) so it forces me to get to the point quickly.  As my confidence grows (no guarantees), I may post more than once a week.  I also leave room that I may decide to use video or audio clips, but for now I’ll stick with simple written submissions.

I’m also finding I have tons of friends that, like me, were really stuck in the past (the designer of my website called me “so web 1.0″).  I hope to also introduce them to the world of blogging as I teach myself a few new tricks.

So Stay tuned.  Bookmark this site…subscribe to the feed…or simply check in every weekend and participate (voting on the posts are also anonymous and a good way for me to judge if I’m on the mark or off base).

Next deadline: 1/2/10

I admit, I started my 2010 New Years Resolution last September when I initiated this blog.  I spent several months pre-populating the blog with various tidbits of a personal nature to practice using WordPress (the platform you’re reading) and to experiment with a number of topics.  While I have learned a great deal, I have far to go.

The point of this posting is to state that a New Years Resolution should be communicated. It should be a statement worth sharing.  It can be personal, which means you would only share it with close family members or a privileged few…but it is nevertheless a statement and requires the courage to communicate.  For it to “count” you must do more than just think about it.  You must have the courage to place it in view of someone.

I obviously told a couple of close friends & colleagues about this site while it was under development, even though I wasn’t yet sure I knew where it would lead.  It was necessary to gauge the level of expectations of my intended readers and to make adjustments when necessary. The best example was the revelation that anonymous postings were absolutely required if I wanted to entice people to participate.  At Ford Motor Company (and I’m sure many other fortune 1-100’s), it is a kiss of death to be viewed outside of mainstream.  So, the addition of the ability to join this conversation with an alias was born.  Anyone may log in and add value to this site without the fear of someone misinterpreting their devotion to their employer.

My resolution is simple:  I will stick with this blog and focus on  Transformations. I will post, at least, 52 weekly entries intended to spur conversation as well as personal & career reflection.

Of course, it’s not the only thing we will see on this site.  I fully intend to maintain my focus on mentoring others, pontificating my own “point of view”, sharing my own fascination with the study of the future and any/all tidbits associated with true value.  To make things interesting, however, something as personal as transitioning is worthy of my primary focus.

Feel free to jump in.  Learn from my mistakes (hopefully this blog isn’t one of them), learn from the experience of others commenting (tbd) and read my thought process and decisions during the next year or so and decide for yourself how you can do the same.

What is your New Years Resolution?

http://ford.digitalsnippets.com/technology/#headline
Remember that Ford commercial in which the narrator (a notably blunt TV star and stand-up comedian) recalls seeing someone in a car next to him on the highway driving with his knees while talking on the phone and eating a cheeseburger? He concludes that it isn’t just crazy out there on roads today, it’s “certifiably insane.” It turns out that most people agree with him.

According to a new national survey released last week, the vast majority of U.S. drivers believes handheld texting while driving is very dangerous and should be banned nationwide. While texting is just one form of distraction, it has become the tipping point in a national debate over what constitutes a dangerous level of distraction behind the wheel.

“Very dangerous”
The survey showed that 86 percent of U.S. drivers believe handheld texting while driving is “very dangerous” and 93 percent support a nationwide ban on texting. At the same time, only 42 percent of respondents believe drivers would stop texting behind the wheel if the practice was banned. However, more than 75 percent believe there would be more compliance if hands-free or voice-activated technologies were widely available.
The online survey was conducted September 18-21 by Penn, Schoen & Berland Associates on behalf of the Ford Motor Company. Ford commissioned the survey as part of its efforts to understand driver perceptions related to distracted driving. Ford recently endorsed a proposed nationwide ban on handheld texting introduced by Senator Charles E. Schumer (D-NY) and Rep. Carolyn McCarthy (D-NY).

The survey shows that 67 percent of drivers said they believed voice-activated technology is a safe alternative to texting, and 76 percent said such a feature would be an appealing feature in a car.

The survey results come as the U.S. Department of Transportation is scheduled to host a summit on driver distraction in Washington, D.C., next week.

According to the survey, there is confusion among drivers over existing state laws prohibiting handheld cell phone use and/or texting while driving. Currently 18 states have enacted such bans but nearly 40 percent of drivers in these states indicated they were unaware of the ban in their own state.

Research on driving solutions
According to a NHTSA-sponsored 100-car study conducted by Virginia Tech Transportation Institute, driver inattention that may involve looking away from the road for more than a few seconds is a factor in nearly 80 percent of accidents.

Ford developed the Virtual Test Track Experiment (VIRTTEX), a state-of-the-art simulator that monitors and analyzes a variety of driving behaviors. Since VIRTTEX opened in 2001, Ford has completed a number of driver distraction studies that have contributed to the development of Ford’s Driving Skills for Life teen driving education program, the MyKeyTM programmable teen-safety feature and SYNC® hands-free communication technology.

Quotes

“Research shows that activity that draws drivers’ eyes away from the road for an extended period while driving, such as text messaging, substantially increases the risk of accidents. That is why we support a nationwide ban on handheld texting while driving and why Ford has developed hands-free and voice-activated technologies to allow drivers to remain connected, but to do so while keeping their hands on the wheel and their eyes on the road.”
– Jim Vondale, Director of Ford’s Automotive Safety Office

“A growing number of drivers are using handheld wireless communications and music-playing devices while driving. Research clearly shows that manual operation of those devices that takes the driver’s eyes from the road for an extended period of time creates the kind of distraction that causes accidents.”
– Dr. Louis Tijerina, Ford senior technical specialist

“Our studies show that teens are much more willing to take risks while driving, such as manually dialing on a mobile phone in situations that demand greater attention.”
– Jeff Greenberg, senior technical leader, Ford Research & Advanced Engineering.

Now what?

This is simply a test post using a screen shot from my stock tracking software (Worden’s Telechart).  As I have been a wallstreet wannabe for many years, I have taken to everything from reading stock patterns and studying value investing to trying my own hand speculating (not always investing).  I would argue that I am certainly not a professional and I am completely biased in my picks so take what I write in future postings regarding stocks with a major grain of salt.  But the last 12 months in the automotive business is too rich with vignettes to avoid talking about it.

Before the crash, I would have agreed with virtually everyone else that Ford stock (F) was a risky proposition.  Bankruptcy was not out of the question, our sales & share were tanking, and we couldn’t seem to keep our cost cutting ahead of our revenue declines.  But things began to hit the floor.  The bankruptcies of GM AND Chrysler meant that only Ford would be left standing (American owned OEM).  If GM and Chrysler were to come out of BK, they would be forever tarnished (at least for the present generation) and the short term lift in share could be incredible for Ford.  Obviously, given the behavior of the share price pictured, the last 6 months have been very good to shareholders.  A lot of people have jumped on the bandwagon.  But now that the price has recovered to 2006-7 level prices, what can we speculate?

Reminder:  I do NOT have any inside financial knowledge at Ford Motor Company.  I am only speculating.

Here is something I’ve been arguing around the water cooler:

• Eventually the preferred shareholders (class B shares) are going to want the dividend restored.
• Going back to 1959, the average quarterly dividend was 53cents a share.
• Buying stock while it is low priced (now that the risk of bankruptcy is minimized) will give a huge return once those dividends are restored even if it takes years to get back to average.
• Even with the risk of 20-50% dilution in a debt for equity swap, the investment may yield a substantial long term return with an average dividend.

Sure, it is a wild bet….but so is the stock market.  It is fun to speculate if you are young enough to make these kinds of bets.