What Ford Needs to Do

Manage staff downsizing with precision

Plans to cut 14,000 white-collar jobs — a whopping one-third of the auto maker's U.S. operating staff — need to be executed with the skill of a surgeon. Mulally and Fields must make sure the inevitable disruptions and eventual brain drain caused by the process don't take management's eye too far off the ball.

Determine a viable product plan — and stick to it

The future starts here. Ford needs to figure out once and for all what each of its core brands stands for and the types of vehicles needed to succeed. The auto maker's repeated change of direction has starved Mercury and Lincoln of product, confused buyers and helped speed the company's overall decline. Failure to get it right only will mean more job cuts and plant closings.

Stabilize top management

Mulally quickly must determine who is on his team and then find a way to keep them there. All the recent change at the top — no fewer than 10 high-ranking executives have moved on in less than two years — has led Ford to more than its share of strategic waffling. What's needed is a management team both insiders and outsiders can trust and that will stick around long enough to see the recovery through.

Protect the family jewel

Ford says it will redo its critical F-Series pickup by 2008 in light of softening sales and intense competition expected from a revamped Chevrolet Silverado and Toyota Tundra. But navigating the redesign of America's most popular vehicle will be tricky. Too bold a redo may turn off buyers. Too conservative and all the money and effort may go for naught. A miss either way is certain disaster.

Get lucky

Ford will need to read the tea leaves correctly if it is going to develop cars and trucks that resonate with future buyers. It must do a better job of coordinating development globally and cost-effectively across its myriad brands, use its remaining plant capacity wisely and find ways to improve productivity and quality.