“Before we do anything, I gotta give you the tour,” says Mark Fields, CEO and president of Ford Motor Co. It’s 9 a.m. on a gorgeous fall day in Dearborn, and brilliant sunlight is streaming into every nook of his spacious corner office on the 12th floor of Ford’s world headquarters, the iconic Glass House.
Although Fields has already been at work for hours — he typically arrives before 6 a.m. — he’s fresh and energized. The 54-year-old CEO has been on the job for 18 months, but he’s been at the company for virtually half his life, after being recruited by Ford in 1989. It’s obvious the view from where he sits at the very top thrills him. And now he’s spotted something he’s eager to share.
“Right down there I can see one of my competitors,” he says, pointing to the southeast toward downtown Detroit. “GM’s right down there. And on a clear day you can see … all the way up to Auburn Hills (headquarters of FCA US), and on a really clear day, if you look that way, you can see all the way over to Japan.”
He’s joking, but not so much. In his position, Fields not only has to keep a wary eye on what Ford’s traditional rivals are up to, but he also has to stay abreast of a slew of new competitors outside the automobile business who, every day, are forcing the Big Three to access their strategies and goals for the 21st century.
“The way we’re looking at the business, and the way I have to look at it, is to have one foot in today and one foot in tomorrow, right?” he asks — the first of several times that he’ll end a statement with a rhetorical question. “We have to have one foot in today in delivering this month’s sales objectives, this quarter’s financials, this year’s overall objectives. And then we have to have one foot in tomorrow, which is: What is our view of the world 10, 15 years out? And then, based on that world, (we have to) make decisions on where we want to play and how we want to play, and make investments in people and in the business to allow us to be successful.”
As far as achieving his goals in the “one foot in today” category, there’s much to celebrate. At an early morning global town hall meeting just a few weeks earlier, Fields broke some exciting news to Ford employees around the world: Thanks, in large part, to flourishing sales of the F-150 truck and the recently-refreshed Mustang and Escape, among others, third-quarter earnings of $1.9 billion more than doubled the results from a year earlier, generating Ford’s best quarter ever in North America.
Positive trends in Europe and South America also bolstered the good news, as Fields assured his global team of a strong fourth quarter, too, despite a predicted increase in material costs and signing bonuses that were part of the recently renewed four-year contract with the United Automobile Workers.
“We positioned this year as a breakthrough year for us,” Fields says, “and part of it was all the record launches we had in 2014. We had 24 global launches, and in 2015 we had 16. So that’s really starting to pay off in the business, and it’s shown in our financial results.”
For his “one foot in tomorrow” part of the equation, Fields starts to answer, then suddenly pops out of his chair, walks over to his desk and grabs a piece of paper. On it is an infinity symbol — a figure eight, lying on its side. In the space to the left side of the symbol is written “Core Business.” On the right, “Emerging Opportunities.”
“This is how we approach the question of how do we remain relevant,” Fields says. “We love the core business that we have, which is designing, developing, manufacturing, and marketing just terrific cars, utilities, and trucks, along with financing and servicing them. We’re proud of every single vehicle that we introduce into the marketplace, and we can’t expect our customers to be more excited and proud about those products than we are. And then we have these emerging opportunities around autonomous vehicles, ride-sharing, car-sharing — all under the banner of Ford Smart Mobility, our strategy to use innovation to get us to the next level of connectivity, mobility, and autonomous vehicles.”
Fields pauses, leaning forward in his chair.
“We’re not just thinking about this as oh-my-gosh, we have to have an autonomous vehicle, or are we going to do a ride-sharing service, or things of that nature,” he says. “We’re thinking about it more holistically, about how do we make people’s lives better; we think of ourselves as a mobility company, and not just a car and truck company.
“And the reason we use the infinity symbol here,” he says, pointing to the document, “is to send the message to the organization that first off, by definition, infinity is without limits, so you can grow each one of these areas. But more importantly, these two things are connected, they feed one another. And it’s not moving from an old business to a new business, it’s moving to a bigger business.”
Fields is quick to offer up the telling numbers supporting Ford’s commitment to its core business.
“We’ve set end-of-decade goals to sell around 8 million vehicles or so,” he says, “and we’ve set a long-term goal, without a specific time limit on it, to be top-five in sales (in the world). Right now we’re No. 6. When you step back globally and look at the growth, today the global industry is about 85 million units, give or take. By the time we get to the beginning of the next decade, that should be over 100 million units.
“When you look at where that growth is coming from, a lot of it is from the emerging markets — China, India, southeast Asia, and Russia, to a certain degree, once it starts getting back on track. We’ve made a lot of investments in Asia-Pacific. Our China business has grown tremendously over the past three or four years. We’ve built 10 plants there since 2010 and our market share is about 5 percent. That’s up from less than 2.5 percent just three or four years ago. And we’re continuing to add new products and new segments.”
While Ford hasn’t opened a new manufacturing plant in the U.S. since 2004 — the last was the Dearborn Truck Plant Fields can see from his office window — the company has poured billions of dollars into updating and improving its existing operations. “If you just look at the last UAW contract since 2011,” Fields says, “we’ve invested well over $10 billion here in the U.S. in plants and facilities, and we’ve created 25,000 new jobs.”
It’s an opportune time to ask him to comment on remarks Republican presidential candidate Donald Trump frequently made last fall, alleging Ford was fleeing the U.S. by building or planning new plants in Mexico — which offers an inexpensive entrée into South America, where some individual countries have high tariffs and import fees.
“We’ve been very clear,” Fields says. “We run our business based on the facts, and the facts of the matter are when you look at some of the statements, it’s really unfortunate that in a presidential politicking year, the facts sometimes get lost. And the facts are when you look at what we’ve invested since 2011, and when you look at our capital expenditures in North America in any given year, over 80 percent of the money we spend on our facilities is done right here in the U.S. When you look at our engineering, 97 percent is done here in the U.S. So we are very, very proud of the contribution we make to the economic development of the country. We make no excuses for it, we are proud of it, and our approach is to just focus on the facts.”
Fields is equally intense and passionate when talking about Ford’s Emerging Opportunities category, the other company goal displayed in that infinity symbol.
“When you think about that world 10, 15 years from now,” he says, “the way we look at it is, what are the societal factors that are changing and will actually change the world? Today there’s like 28 megacities of 10 million or more people around the world. There will be over 40 in 15 years. There’s the growth of the global middle class, going from 2 billion today to 4 billion people, and a lot of that growth will be in the Asia-Pacific area. And then there’s the whole issue of air pollution and how it’s growing. It used to be kind of an environmental issue — it still is, of course, but in some cases it’s a basic health issue.”
It’s a lot to ponder, and Fields hasn’t even gotten to how Ford can make an impact on how all these people are going to get around in a world that is rapidly becoming more crowded and less dependent on traditional forms of transportation.
“The behaviors of consumers like millennials and Gen Zs are changing,” he says. “I mean, they’re delaying marriage, they’re delaying buying houses, and they have different views of mobility — particularly in urban areas, where they want more access versus ownership. So we have to pursue a number of new initiatives, which in some cases may mean bringing in some new talent to complement the talent we have. It may mean new business models in there, which may not seem core to us today but could be tomorrow.”
At the top of that list, he says, is the commitment Ford has made in Silicon Valley.
“Let me put the Silicon Valley operation into perspective,” Fields says. “We set up shop out there in 2012 and we had a small office. It was basically three people, a dog, and a beanbag chair. Just a listening post. And we decided that at the end of (2014), we really wanted to be part of the community there. And it was a risk, right? Because here we are, Ford, we’re gonna go out there, facing off with Google and everybody else that provides massages and free food and everything else (to employees). But the great news is we’ve gotten great candidates who are passionate about really wanting to help change the world.”
As a result, Ford’s Silicon Valley operation is on the verge of receiving a significant upgrade.
“By the first quarter of (2016) we’ll have 125 professionals there,” Fields says. “We probably have about 80 today — software engineers, some business development folks, control engineers, user experience engineers, a number of data scientists. What they’re working on is autonomous vehicles, connected cars, data, and analytics. And they complement the talent that we have here, and they feel like they are part of Ford.
“We don’t want to be viewed as just a transactional partner that flies in, says I’ll take one of those and one of those, and then flies back, because Silicon Valley is really a community of ideas, and very open. And a lot of the ideas happen when you’re bumping into your buddy in the coffee shop or you have these meetings and people are sharing ideas. So we want to be viewed as part of the community.”
Of course, Fields readily affirms that the concept of Ford being a vital cog in a community of innovators and tinkerers isn’t exactly a reach.
“You go back to our founder, Henry Ford,” Fields says. “He was the ultimate innovator, right? The moving assembly line, the $5-a-day wage, which helped create the middle class. And even in the recent past, if you think of our Sync (infotainment) system, EcoBoost engines, and the aluminum F-150, our vision as a company is to use innovation to create products and services that make people’s lives better. It’s not just the big things, it’s the small things. It’s not just the complex things, it’s the simple things. So everybody in this organization can contribute to that and, for us, innovation in its simplest form is people coming together and creating value by implementing new ideas.”
Fields pauses, seeming to let it all sink in. “We don’t have to inject innovation into the company, right?” he says. “We don’t have to bring all of our people off-site for two days and PowerPoint them to death: I’m going to teach you how to innovate. We don’t have to do that because it’s already who we are!”
And with that, he’s again out of his chair, reaching for another document, showing an image depicting the Ford customer surrounded by a cluster of action words like Empower, Enable, Engage, Foresee, and Connect.
“So here’s the customer in the middle,” Fields says. “How do we get them to live, play, and work where they want? It’s about connecting them, making them part of the connected car, connecting them to their world, always. Using data and analytics to help anticipate their needs. Engaging them, regardless of how they want to move, whether they want to drive a vehicle or be driven by a vehicle. Empower them to do that, whether it’s autonomous or otherwise, and make sure they have an experience, through a lot of technological enablers, so that they love their experience with Ford and it’s so sticky that it’s tough for them to move to somebody else.”
To that end, more than 25 experiments around the world are in various stages of completion under the banner of Ford Smart Mobility. These experiments are focused on five areas: connectivity, mobility, autonomous vehicles, customer experience, and data and analytics. The experiments also include looking at multimodal travel solutions, which involve how people utilize various modes of transportation including cars, trucks, and public transportion (trains, buses, and even bikes) at various points in a single journey.
One of the experiments, called GoDrive, is based in London. Touted by Ford as the frontrunner in offering one-way trips with guaranteed parking, the pay-by-the-minute car-hire service — in U.S. currency it works out to approximately $15 an hour — allows customers to utilize an app to select either a zero-emission Focus Electric or a Fiesta equipped with a fuel-sipping EcoBoost engine at 20 locations across the city.
“Every company has to have a why, right?” Fields says. “Our why, as a mobility company, is making people’s lives better. So in the future we not only want to satisfy customers who want to buy, own, and drive vehicles the way they always have, but even in those areas where, from a mobility standpoint, people want access versus ownership.
“So why can’t we give them a Ford experience and build the Ford brand for providing innovations around getting people to live, work, and play where they want? And ultimately, by using these kind of services, it not only helps reduce congestion, but it also provides a bridge to affordability so that, eventually, folks who experience our vehicles through Ford Smart Mobility will be more inclined to purchase a Ford when they’re actually ready to buy a vehicle.”
It all brings to mind the early days of Fields’ career at Ford, when he was based in Japan — the CEO of Mazda at just 38 years old, the youngest person ever to run a major Japanese company. It was when he came to appreciate the local term, nemawashi.
“It means planting seeds,” Fields says. “And what I love about the term is people think as a leader you can get your team around and tell them: Here’s a strategy we’re going to go on, and then go off and prosper. But getting commitment from the organization is different than demanding compliance. We want to decide on things as a team, and I think one of my key roles is to make sure I’m a molder of consensus and not a searcher for consensus. Nemawashi is really looking at the world as a team, one foot in today and one foot in tomorrow, and coming together so everybody feels it’s their plan, not just my plan, and they have to implement it. That’s why planting those seeds is so important.”
Fields pauses and then rocks forward. “I love sayings,” he says, “and there’s one that goes, If you want to build a boat, you can take one approach that says drum up the people, go into the forest, cut down the trees, saw the planks, nail them together, and build the boat. The other approach is to teach them a love for the sea. So how do we teach the organization a love for the sea?”
Addressing the company’s future product lineup, Fields focuses on the strategy for Lincoln.
“We’re really excited about where we’re heading with Lincoln,” he says. “As we’ve said in the past, our commitment is to turn that into a world-class luxury brand. We’ve spent a lot of time thinking through where do we want Lincoln to be positioned? And I think you can see (where we’re headed) through the designs of our new vehicles, the way we go to market, the advertisements, (the decisions) to not try and copy somebody else. When we introduce the new Continental (in 2016), that will be what I call the first phase of the Lincoln transformation. We have the new MKZ, the MKC — which is the small utility, MKX — which is the larger crossover, (that) we just introduced to the marketplace, and the Continental. That’s what I call phase one.
“Now we’re working on phase two of those products,” he continues. “And the good news is we’re seeing progress in the marketplace. Our sales outpaced the growth of the luxury industry last year, and I think they’re outpacing year-to-date so far this year. But we’ve also been very open around here: This is a journey — which means it’s going to take some time, right? If you look at any great brand, whether it’s a car brand or a luxury brand or whatever, it takes years to build that up. And we’re very committed to doing that.”
As he peers down the road at his own career, Fields is planning to lead Ford for a long time.
“I love what I do,” he says. “And because I love what I do, it energizes me. In these kinds of roles you’re always working; that’s why you have to enjoy it. I do a lot of exercise, mostly at night, because it’s a way for me to de-stress, to kind of process the day. So I work the physical and the mental.
“The other thing I love to do is travel. And that’s why I spend a lot of time on the road, seeing our people. I love visiting places around the world where I’ve either lived or traveled before. But I also get energy from the organization. Any time I go to see our people, I always leave with more energy than when I came.” db