I remember back in 1980, when the future oflooked very, very grim. The company was downsizing drastically: bleeding red ink, laying off thousands and padlocking plants.
Times were tough in the American market. Soaring gas prices brought truck sales to a grinding standstill. Customers suddenly switched to smaller passenger cars, especially imported ones. By 1982, total U.S. light-vehicle sales fell to only 10.5 million units, a 39% drop from the record set four years earlier.â€™s stock price dropped 70%. Morale was at rock bottom.
Drastic times require drastic action, and Ford management developed a laser-like focus. To fix quality, it brought in W. Edwards Deming, the cantankerous quality guru who taught Japan how to build the best. He tore Dearbornâ€™s management a new one, but his message stuck. Soon Ford plants were papered with statistical process control charts and executives preached Demingâ€™s quality mantra.
The auto maker reached out to its hourly employees, and with the cooperation of the UAW, began forming Quality Circles. Workers began to have a voice in how to build the cars and components coming down the line, and the impact was immediate. Soon, Ford could legitimately claim, â€śQuality is Job 1.â€ť
On the product side, designers were let off the leash. Overnight, the origami Fairmont design was tossed out and replaced with the aerodynamic shapes that set Ford apart.
While GM andinitiated crash programs to downsize all their cars and convert them to front-wheel drive, Ford couldnâ€™t afford to. It was a blessing in disguise. It wasnâ€™t long before the restyled Lincoln Town Car was crushing Cadillacâ€™s downsized FWD models.
When Ford finally got around to doing a midsize FWD sedan, it really did it right. â€śTeam Taurus,â€ť led by the late Lew Veraldi, adopted a whole new way of developing cars. First, he formed cross-functional teams made up of people from design, engineering, manufacturing, purchasing, finance and sales and marketing.
This ensured fresh ideas from all over the company would be incorporated into the process. And when problems cropped up, the multidisciplinary approach produced quick answers.
Then Veraldi established 100 Best-in-Class benchmarking targets. Team Taurus scoured the worldâ€™s cars for the best features and functionality. He mandated that if the BIC teams couldnâ€™t beat the best, they had to match it.
And they didnâ€™t scrimp on the product. The Taurus and Sable got completely different sheet metal â€“ no badge engineering. The station wagons even got unique bodyside-apertures and a different rear suspension to give them a better look and more cargo space. In fact, 3-time Formula 1 champion Jackie Stewart was brought in to hone the Taurusâ€™s driving dynamics. Jackie Stewart!
By 1987, Ford posted a $7 billion pre-tax profit. Thatâ€™s $23 billion in todayâ€™s dollars.
Ford now faces tough times again. But the question isnâ€™t if the auto maker can do it again. Of course it can. The question is, will it do it again? Because thatâ€™s what it takes: the will.
John McElroy is editorial director of Blue Sky Productions and producer of â€śAutoline Detroitâ€ť for WTVS-Channel 56, Detroit, and Speed Channel.