A recent news program focused on Ford Motor Company and how it managed a more solid performance in the midst of the economic downturn and the other auto manufacturers’ rapid decline. Ford is the only major auto maker to not take government bailout money and appear to be the corporation that will see profitability again before the rest. As I was watching, I realized there were some excellent lessons in Ford’s “success” for small business owners and entrepreneurs.
Recognize problems and correct course early. Ford recognized upcoming financial difficulties and acknowledged them before GM or Chrysler. They did a financial reorganization early on which helped them avoid the government funds and allowed them a headstart on healing what ailed them.
Admit when you need help. William Ford realized he did not have the experience or skill set to manage the company through the difficult times they were facing. He voluntarily stepped down AND refused a salary (as Chairman) until the company turned a profit again.
Be willing to take risks and think innovatively. Alan Mulally was a risky choice with no automotive background but had steered Boeing through tough times. Many questioned the choice of an industry outsider as CEO, but it turned out to be a very wise one.
Refocus on your niche. Ford had 98 “nameplates” (different models under various brands like Jaguar and Land Rover) when Mulally stepped in. He is trimming those down to 20-something in an effort to clarify the Ford brand. Do you know what YOUR brand is and the customers you are serving? Don’t spread yourself too thin. No business can be all things to all people.
Talk to your customers. After talking with theirs, Ford realized that, as Americans downsized to smaller, more fuel-efficient vehicles, they still wanted little luxuries in their autos. Ford will roll out a new and improved Fiesta which is a top-seller for them overseas. Despite the low price tag and small size, the Fiesta will have high end standard features like spoilers, rear window wipers and MP3 compatible stereos.
Take some time to consider your own business and if any of these steps are appropriate to help you “steer out” of this downturn more quickly. Feel free to let other readers know your thoughts about this topic in the comments section below.
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by Steven Schlagel