Found On Road… Death Spiral – Ford to cut one-third of salaried staff, $5 billion in costs, stop dividend

As a guy who grew up in Michigan and around the auto industry, this is sad. Does it really take a new “$30 Million Dollar Man” to come up with slash-and-burn management approaches? That’s not terribly innovative. How much did the consultants get paid to convince management “you’re not selling as many cars, and it looks like you won’t be in the near future, so you better not build as many cars.” The death spiral continues.

Does the “new guy” take the blame for this? It’s probably just bad timing on Mulally’s part to new appointed new captain after the ship hit an iceberg. What a slap in the face to Ford workers that the big boss can get $18.5 Million up front while the company is being decimated because the company suffers from “rapid shifts in consumer demand that affect our product mix and continued high prices for commodities”?

Translation — Ford doesn’t design vehicles that people want to buy, so the workers suffer as a result.

Lesson for me — don’t EVER be part of a company that isn’t growing. Shrinking is painful. As management, don’t let it get to that. It all falls apart if you’re not growing, no matter what the business.

The lesson I would NOT take away from this: “See, lean doesn’t work, it couldn’t save Ford.”

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Mark Graban's passion is creating a better, safer, more cost effective healthcare system for patients and better workplaces for all. Mark is a consultant, author, and speaker in the "Lean healthcare" methodology. He is author of the Shingo Award-winning books Lean Hospitals and Healthcare Kaizen, as well as The Executive Guide to Healthcare Kaizen. His most recent project is an book titled Practicing Lean that benefits the Louise H. Batz Patient Safety Foundation, where Mark is a board member. Mark is also the VP of Improvement & Innovation Services for the technology company KaiNexus.

1 Comment

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