Ford Motor Company’s Sustainability Strategy for Growing Sales

During the North American International Auto Show, I had the opportunity to meet with Ford’s Chairman Bill Ford and CEO Alan Mulally to discuss Ford’s business strategy and the role sustainability plays in it.

Bill Ford

Ford Motor Company’s business strategy reflects Bill Ford’s passion to continue his grandfather’s legacy of “making people’s lives better.” Before climate change was a national topic, Bill Ford was recognized as an environmentalist. A measure of true leadership is the ability to hold to your values in the face of criticism. In 1988, when he joined the Ford board of directors, Ford received harsh ridicule from his business peers because of his view that business success is linked to environmental and corporate responsibility. Bill Ford has declined any opportunity to say “I told you so” and instead continues to lead from the front by guiding Ford Motor Company to design and sell products that win competitive advantage on value and values.

Ford’s sales success

Bill Ford’s vision and courage to hold to his values has been validated. Ford Motor Company is setting sales records selling cars and trucks designed around fuel efficiency that achieve lower tailpipe emissions while being fun to drive and price competitive. 2012 marked the second straight year that Ford Motor Company sold more than two million Ford branded vehicles in the U.S. Ford is the only automotive brand to top two million U.S. sales since 2007. The Ford Focus remains the best-selling global vehicle nameplate.

Ford CEO Alan Mulally

A mark of a great leader is the ability to recruit outstanding people. The measure of a leader’s strength is their ability to allow others to lead. Bill Ford epitomizes the words of Coca-Cola’s legendary CEO Robert Woodruff:

There is no limit to what a man can do or how far he can go if he doesn’t mind who gets the credit.

Bill Ford demonstrated such leadership when he hired Alan Mulally away from Boeing. Mulally brought to Ford Motor Company strong business skills and global leadership in high-tech manufacturing. Like Ford, he is humble, calling Bill Ford his “supervisor.” But it was Mulally who initiated and led the “One Ford” cultural change inside Ford that is driving down costs while also introducing price competitive products loaded with cutting-edge technologies.

Mulally on sustainability

Mulally views sustainability on two levels. Mulally’s big picture for sustainability is defined by how well a company can survive and grow in today’s intense competitive environment. “Continue to serve” is his definition of sustainability on the enterprise level. “Continue to serve” is achieved by offering products that customers want, and will pay for, produced by using fewer resources and that will achieve cost competitiveness through superior productivity.

From his enterprise-scale definition of sustainability, he then defines every resource as “precious.” This “precious resource” perspective drives the enterprise to reduce the use of water, materials and energy in the production, distribution and sale of product. Tellingly, for every company that thirsts to be a Ford Motor Company vendor, Mulally says,

People I like to associate with have that view of sustainability.

Mulally video interview on sustainability

The following two minute video captures Mulally talking with me about the role he sees sustainability playing at Ford Motor Company.

http://www.youtube.com/watch?v=dvgOR0OpzJY

This is the first of a four-part case study on how Ford is going green. Their best practices can be used by every business to grow revenues and win customers. The second article will profile Ford’s Go Further brand messaging built upon sustainability including an exclusive video interview with Ford's Global Director of Sustainability. Upcoming articles will feature Ford's electrification technologies and a test drive of their plug-in electric C-Max Energi car.

Travel and accommodations to NAIAS in Detroit were covered by Ford. Opinions are my own.

Bill Roth is an economist and the founder of Earth 2017 He coaches business owners and leaders on proven best practices in pricing, marketing and operations that make money and create a positive difference. His book, The Secret Green Sauce, profiles business case studies of pioneering best practices that are proven to win customers and grow product revenues. Follow him on Twitter: @earth2017.