The 'One Ford' Strategy
In September 2006, Alan Mulally was appointed CEO of Ford. Soon after, he unveiled the 'One Ford' strategy in an effort to stimulate growth.
ONE TEAM
The first component of the 'One Ford' strategy concerned people. It recognized the importance of a skilled and motivated workforce working together as a team. The company planned to develop a winning team by putting in place the principles and practices that would unlock the full potential of its employees. To start with, all employees who were connected to a project were to be included in the decision making process. While work was to be assigned to teams, individuals were to be given authority and held accountable for delivering results....
ONE PLAN
The second component of the strategy was a single plan for the entire global enterprise, with unambiguous performance goals. Traditionally, Ford's regional operations operated as autonomous business units. While many of these units had been successful, it was felt that this mode of operation was too inefficient and would not be sustainable in the long run. The 'One Plan' involved replacing disparate units with a single, unified entity...
Implementing the Strategy
Ford set out to implement the 'One Ford' strategy. Its initial focus was on securing financing as this was vital for the restructuring efforts.
SECURING THE FINANCING
In December 2006, Ford secured $23.5 billion of new liquidity. In addition, the company obtained a convertible debt of $4.95 billion, a secured term loan of $7 billion, and a secured revolving credit facility of $11.5 billion. This amounted to total automotive liquidity of about $46 billion at year-end 2006. The company intended to utilize this liquidity to fund the restructuring and product development initiatives. It was also to act as a cushion for unforeseen events in the near term...
RESTRUCTURING THE COMPANY
As part of the 'One Ford' strategy, the company initiated a restructuring exercise of its automotive business with the objective of dealing with the realities of lower demand, higher fuel prices, and changing consumer tastes. On September 15, 2006, the company announced that it would accelerate the 'Way Forward' plan that the company had announced at the beginning of the year. This was expected to further bring down annual operating costs by approximately $5 billion by 2008 (compared to 2005) and quicken the flow of new products