The Big Three automobile makers’ CEOs drove to last week’s Congressional hearings — an improvement, I suppose, over flying in separate corporate jets.
Ford made a credible case, and while giving the guy credit is painful given my past criticism of his compensation (“Fix Or Repair Daily,” KJR, 3/12/2007), Ford’s CEO, Alan Mullaly apparently took my advice two years ago (I’m sure he reads KJR — aren’t you?) and has focused the whole company on building cars people want to buy (“Time for architecture planning,” KJR 10/9/2006).
Here’s Ford’s official statement: “Our plan is actually quite simple: to build the best vehicles on the road today and make them affordable for millions.”
This is as good as it gets when it comes to mission statements. It’s simple, concise, clear, energizing, and convincing. Best of all, Ford doesn’t call it a mission statement.
Mullaly also cut his base salary to zilch, which must mean he also read last week’s column (“What to tell employees, and how,” 12/8/2008) which explained that employees need confidence their leaders:
- Know what’s going on.
- Know what to do about it.
- Have a plan for getting it done.
- Are working harder than anyone else in the company to get it done.
- Will be as compassionate as possible regarding any changes that have to take place.
- Will share whatever financial pain employees experience as part of getting through the tough times.
There’s more than a bit of fluff in Ford’s delivery, I’m afraid: To support its claim to be neck-and-neck, quality-wise, with Toyota and Honda it cites reports from BusinessWeek and the Insurance Institute for Highway Safety. Road and Track, Car and Driver, and Consumer Reports would be more convincing. Maybe next year.
But at least Mulally has pointed Ford in the right direction.
GM’s Wagoner and Chrysler’s Nardelli failed to describe any plan to start increasing their share of the U.S. automotive marketplace, nor did they acknowledge this as the root cause of their problems.
And in spite of their claims that if it weren’t for the economy they’d be fine, marketshare is the root cause. The most recent numbers I could find show that in the United States in 2008, once again, GM, Ford, and Chrysler lost marketshare to everyone else. Everyone.
It isn’t only GM and Chrysler whose employees are feeling anxious right about now that their leaders might not have a good plan. Given the state of the economy and the sheer number of companies that are planning layoffs, have announced layoffs, or have already undergone a round of layoffs, just about the only certainty you have right now is that the employees reporting to you are feeling uncertain.
To understand the impact of uncertainty, compare this statement: (1) “We’re the IRS and we’re going to audit your tax returns,” with (2) “We’ve just finished our audit and you owe $17,500.”
Or this: (1) “We have no idea what’s causing your symptoms and they’re getting worse,” with (2) “You have cancer. Your chances of survival, given proper treatment, are about 70%.”
See the point? Even very bad news is better than uncertainty, because uncertainty has no limit when it comes to envisioning just how bad a situation might be.
And make no mistake: Employee uncertainty is very much your problem, because uncertain employees divert time and attention away from their work, spending it instead on worry, grumbling, gossip and job searches, exactly when you need all hands on deck.
If you aren’t already, distribute a weekly communique for all employees. The title: The economy’s impact on us — this week’s update. The text has three sections: Situation, Solutions, and Plan (adapted from the communication format William Bridges recommends in Managing Transitions: Making the Most of Change,” 2003).
Situation describes the company’s view of what’s going on, demonstrating that the executive team is keeping close track of the rapidly shifting landscape. Solutions demonstrates they know what to do about it; also that they will be as compassionate as possible and will share the pain. The Plan demonstrates they know how they will get everything done, and also that they’re working hard at it.
All three sections explain what’s changed since the previous week, because that’s what employees need to know. Every day they read or watch the news. They need confidence their leaders are paying attention too, and are updating the company’s solutions and plans accordingly.
Which the leaders are more likely to do if they know they’ll have to explain it.