MGT 504 Management & Organizational Behavior Case Study Alan Mulally’s Restructuring of Ford Motor Company

Alan Mulally’s Restructuring of Ford Motor Company Case Study Alan Mulally received an opportunity to turn around one of the most famous brand names in the United States. Ford was struggling; losing more than 12.7 million in 2006 (Nelson p558) and desperately needed a change. Alan Mulally took the challenge, and stated he would do what many thought was impossible at the time – make Ford profitable. He did just that.

Mulally knew Ford had issues and the first step was to identify those structural issues. The issues included a wide variety of models and styles of automobiles. A work force that was not collaborating or communication to a high standard, hypercompetitive and relentless competition in pricing and sales, and possibly the most important was lack of accountability.

With the development of his strategic plan of “One Ford” Mulally was on his way to the turnaround of one of the biggest automakers in the world. The first major act of this plan was to sell the Aston Martin division of the company and focus on the customer by building what they really want. By eliminating 70 percent of his vehicle models in fewer than four years, and cutting labor costs by 22 percent, Mulally was well on his way to achieving great success (Nelson p588).

The direction Mulally took in approaching his goals of the One Ford was through understanding what was needed. The focus was on the customers, his employees, and unnecessary overhead costs; such as that of developing two separate productions in the U.S and Europe. Mulally’s strategy was not new; he implemented a similar strategy for Boeing when that company was struggling with a 2.7 billion loss in 1997 (Henry). What Mulally was able to do is

take a successful strategy that was proven and tested and mold it to