Hackett CEO or A.D.?

University of Michigan football coach Jim Harbaugh is quoted as saying, “What will happen will happen, what won’t happen won’t happen.” That Donald Rumsfeldian observation is notable for one reason, which is that Jim Harbaugh was brought to Michigan in 2015 by the then-acting athletic director (A.D.) Jim Hackett.

Hackett CEO or A.D.?

“Ford will prepare for disruption by becoming fit.”

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University of Michigan football coach Jim Harbaugh is quoted as saying, “What will happen will happen, what won’t happen won’t happen.” That Donald Rumsfeldian observation is notable for one reason, which is that Jim Harbaugh was brought to Michigan in 2015 by the then-acting athletic director (A.D.) Jim Hackett.

Yes, the same Jim Hackett who became president and CEO of Ford on May 22, 2017.

When Harbaugh says things like that he does it in the context of the game and with such zeal that you can’t help but believe it.

But Hackett?

Well, his proclamations are going to have a more profound effect on the OEM than the coach’s on the team. And what he says better happen. “Won’t” is probably not an option.

Earlier this month, Hackett went to Wall Street to lay out the future plans for Ford. And it seems that the crux of the matter is all about “fitness.”

Early in his presentation to investors Hackett put up a slide titled “Five principles we need to act on.”

The first in the list of five: “Ford will prepare for disruption by becoming fit.”

Now while fitness generally is associated more with the gymnasium than the boardroom, Hackett went on to provide a chart that defines how they plan to become fit. “Our first priority is to reset revenue and attack costs.” While the “reset revenue” has something of the Silicon Valley VC to it, the “attack costs” smacks of the gridiron.

The other path to Ford fitness is “Redesign Business Operations,” which is more Wall Street Centric, but know that both of those fitness routines are located directly on top of a box that comes right off the cover of a coach’s playbook: “Winning Aspiration.”

That becomes defined by a slide headed “Understanding our future starts with a winning aspiration,” which is followed by the company’s vision for the future (becoming “the world’s most trusted mobility company, designing smart vehicles for a smart world that help people move more safely, confidently and freely”).

But the athleticism of Hackett’s remarks continues throughout his presentation deck.

Other slide heads:

--“There are many more choices for where we play and how we win”

[This includes developing things from e-bikes to Level 4 vehicles]

--“There are persistent forces that will help us make the choices to move from Now to Far”

[Some of this is predicated changes to the city “decades and decades from now,” which means the transportation offerings are going to be different in the Far rather than the Now]

“We will rapidly improve our fitness to lower costs, release capital and finance growth”

[This fitness plan includes creating ventures in India and China]

“We will re-allocate capital to where we can win in the future”

[Sorry, cars, $7-billion are going to SUVs and trucks]

And literally last but far from least:

  • “We will empower our team to work together effectively to compete and win”

Or, as Jim Harbaugh put it: “I have always believed that you win as part of a team effort. I’ve learned that if everybody does a little bit, it adds up to a lot.”

Ford is going to need significant teamwork in order to achieve some of the targets—presumably “stretch targets,” as that seems to be the sort of thing one would work toward while becoming fit—because they are non-trivial.

For example, they are planning to reduce automotive cost growth by 50 percent through 2022. One of the ways they’re going to do this is by achieving “incremental material cost reductions” of $10-billion. That’s right: incremental material cost reductions. $10-billion.

What’s more, they’re going to reduce engineering costs by $4-billion from planned levels. They’re going to do this through actions—or maybe that should be inactions—like building fewer prototypes. Which seems somewhat at odds with this notion of increasing the amount of advanced technology in vehicles: don’t you want more engineering and prototyping and testing when you are building products that are slightly outside the day-to-day production of the last 100 years or so?

Oh, and they’re going to be reducing vehicle development time by 20 percent.

In 2014, the University of Michigan football team had a 5-7 record.

When Harbaugh came in the following year, the record when to 10-3.

Perhaps Jim Hackett needs to start wearing khakis and U-M gear, because what he’s talking about is arguably far more daunting than turning around a football program.

Ford president and CEO is putting the automaker into a fitness regime to prepare it for the future. The former University of Michigan acting athletic director got things moving there, so maybe it will be the same for the OEM…