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<p>This is a bunch of bull. I happen to know a lot of people in various parts of the automotive industry. The CEOs of these companies have known since the 1970s they were in trouble and were getting their butts kicked on a lot of different levels by foreign competition, especially the Japanese. That’s why long before the current economic downturn, Ford went out and raised over $20 billion to build up a war chest to carry it through an aggressive transformation plan even in the event of a sharp economic downturn—one of the main reasons Ford has not taken a dime of federal bailout money, and why Ford has actually gained market share primarily at GM’s and Toyota’s expense over past several months. </p>
<p>A year ago the CEOs at Ford and GM had no respect for Chrysler and would probably have given it a “1.” Outside the Chrysler family, few people in the automotive industry have had much respect for Chrysler—though a lot of people had hoped that Daimler, with a well-deserved reputation for quality engineering and quality products, would turn things around at Chrysler instead of treating it like an unwanted step-child as it did. But Ford and GM both knew perfectly well their own operations were bloated and inefficient, and they could see it in each other, too. My guess is Ford and GM would have each given themselves a “3” and the other a “2,” and both would have given Toyota a “4.” 9toyota’s far from perfect, too). </p>
<p>In various ways, Ford and GM have both been trying to emulate and/or partner with top Japanese automakers for at least a couple of decades now, setting their Japanese rivals as the benchmark. That’s the way it works in any industry–including higher education.</p>
<p>Ford in particular has bet heavily on a “product-driven” transformation based on “best-in-class” engineering principles—in each vehicle class, doing meticulous comparative benchmarking of all the components, systems, features, and design elements of all its competitors’ vehicles, and seeking to emulate, match, or surpass the “best-in-class” in every single element. They also pay extremely close attention to independent product quality and reliability surveys and feed that information back into their engineering and manufacturing processes. As a consequence they’ve moved well up towards the top of the charts in independent surveys of product quality. (Reminds me an awful lot of the way the best colleges and universities approach their own institutional goals, objectives, and strategic redesigns).</p>
<p>Whether Ford’s transformation succeeds or not remains to be seen—among other things they’re fighting the burden of “legacy costs” and generalized consumer perceptions that now lump all U.S. automakers together indiscriminately under a generally negative label. That’s a lot to overcome. But the assertion that these companies, and Ford in particular, have been sitting back, fat, lazy, and self-satisfied, is plainly just flat wrong.</p>