Bob's Gutsy Leadership Blog

Ford – The Stock Tanks While Management Plods Along!

Recently the stock price of the Ford Motor Company has been trading around $9/share, a drop of 32% versus the start of 2018.  The company makes some money in North America but is losing money everywhere else, particularly in Europe and China.

What is so surprising about Ford is that they don’t seem all that uptight about this dramatic decline. For example, the CEO recently announced “we are in the early stages of re-organizing our global salaried workforce of 70,000 people.”  When questioned about the details he indicated “these planned cuts should be decided by April 1, 2019.”  The lack of urgency of this CEO is amazing.

It gets worse; he recently also stressed that he wants a “participatory process with each layer of management being tasked with restructuring their own group.”  I find that statement to be totally naïve in that he should realize that when you push that kind of decision down further, each subgroup will become incredibly ingenious on why other groups should be cut and/or reorganized but their group should maintain their current structure and enrollment levels.  The creativity of such arguments is typically quite impressive!

The damaging part of stretching out the length of time in making enrollment reductions is the uncertainty for employees which quickly leads to a reduction in productivity. Not only are you delaying getting any business benefits, but you have a bunch of very unhappy people wasting time worrying and arguing why their job should be left alone.

Stepping back, as an indicator of just how sloppy Ford has been, Ford’s current global workforce, including factory workers, totals 202,000 people, up 18% versus 2012.  These big enrollment gains were registered at the same time the stock price was dropping 50% during that period.

One of the most important elements a leader should be bringing to an organization is an ongoing sense of urgency; quickly seizing opportunities and aggressively making significant improvements to get the group on track for success.  Unfortunately you don’t sense one ounce of that kind of behavior at Ford.  That’s why a recent Wall Street analyst has been all over Ford to consider moving in a new CEO to get things moving.

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