Ford Gets Lucky; Customers are Still Job 1

You can say, Ford Motor Co. got "lucky"Aug. 9.

The Bridgestone/Firestone Inc. voluntary recall of 6.5 million tires, which are the target of a regulatory investigation, allows Ford to continue to market its goal of becoming the world's leading consumer company for automotive products and services.

Many of the tires in question are standard equipment on the Ford Explorer and Mercury Mountaineer. It would be hard for Ford to continue to position itself as "the" consumer-first automotive company with millions of its owners driving vehicles with tires suspected of tread separation.

Ford has spent a lot of time and money during the last two years cobbling together a cohesive message, which spans everything the company does, that the customer is Job 1.

Louise Goeser, Ford's quality vice president, continues hammering the message at the U-M Management Briefing Seminars in Traverse City Aug. 10 when she talks about the company's Consumer Driven Six Sigma effort.

Obviously, customer satisfaction is a key to Ford's transformation and Ms. Goeser says that Six Sigma is how Ford will attain quantum improvements in customer satisfaction, by as much as 70%.

Ms. Goeser says it works this way: Identify a customer need and use analytical and statistical tools to fulfill it, while reducing variability and defects that also drive down waste and costs. Fewer defects result in improved customer satisfaction, and higher revenues, which increases earnings.

Indeed, says Ms. Goeser, a one-point increase in customer loyalty translates into $2 billion in added revenue and $100 million in earnings. Customer is Job 1 forms the base of Ford's Strategy Pyramid; atop it sits superior shareholder returns.

No wonder that every announcement that Ford makes is either directly or indirectly tied to the company's customer is Job 1 message.

When Ms. Goeser's boss, Martin Inglis, head of Ford's North American Operations, announced on Wednesday that all of its SUVs and pickups will eventually be equipped with AdvanceTrac stability control, he said it was "in line with our cleaner, safer, sooner commitment" to consumers.

The line also could be applied to Ford outfitting the 2002 Explorer and Mercury Mountaineer with a safety canopy system, which when combined with seat belts, helps keep people in the vehicle in case of a rollover.

"Why more safety? Why more fuel economy?" asks Mr. Inglis. "Our customers are asking for it - particularly on SUVs. And they will reward the ones with the best answers."

Ms. Goeser says the Six Sigma is about "understanding and adapting to our customers' desires and needs. And it is a real shift for us in moving from a transaction-based company to a consumer-driven company."

Ford's transformation is based on five building blocks: strong global brands, superior customer satisfaction and loyalty, best total value to the customer, nimble organization with leaders at all levels, and corporate citizenship.

"Our foremost focus is on those issues that are most important to our customers," says Ms. Goeser. "We believe that customer satisfaction is the best way to drive costs down and earnings up." With that in mind, it would have been difficult for Ford to stand by if Firestone had not recalled those tires. It would have contradicted Ford's marketing message that its customers come first.