Ford plans to fire 1,400 staffers, and many media outlets suggest the move is intended to appease Wall Street by cutting costs (the stock is down and Tesla’s up, so the latter is now “worth” more than the former).
Ford’s in a tough spot, for sure. Incessant talk about autonomous driving dominates most every conversation in the automotive sector these days. I attended this year’s auto show in Detroit, and it was fascinating to watch reporters grill car companies (and their Tier 1 suppliers) about promises and fantasies announced by tech companies and startups. The looks on the executives faces ranged from disbelief to horror.
Because most of it is nonsense.
The automotive sector is destined for disruption, in much the same way as air travel, electrical generation and distribution, and every type of manufacturing. Think newspapers and record labels, only the products are all the things that we use in geophysical space.
The likelihood that any of it can be forecasted is a joke.
The theory of disruptive Innovation, like Darwin’s theory of evolution, works in hindsight, as both have proven very good at explaining how things came to be the way they are. They’re useless at predicting the future, though; awareness of the mechanisms that drive change might help encourage and narrate it, but the theories aren’t determinative.
So it’s silly that the equity markets have already picked winners and losers (though that’s what they do, as pricing “evolves” as time reveals new truths). It’s less surprising that media have also, insomuch that it’s a hell of a lot more entertaining to talk to a tech exec or entrepreneur who gives a great interview, versus a mid-level automotive schnug who’s suffocatingly wrapped in quotes intended to reveal nothing interesting or new.
Ford has bought into the circus, spending lavishly on a Silicon Valley storefront for innovation, where more than a hundred cool people develop digital apps, experiment with AI, and are otherwise as removed from the reality of Ford’s business as, well, Silicon Valley is from the rest of America.
There’s no geographic source for disruption, and innovation happens at the intersections of formerly disparate factors. The car industry 5 years from now will be the product of changes in services, regulations, environmental issues, work and living trends, communications tools, and a host of inconceivable facts that, in hindsight, will seem utterly obvious.
Now it’s going to lay off lots of people, which is a distinctly Old Economy response to challenging news.
I have a different idea to suggest:
How about giving those employees the challenge of changing Ford?
They’re likely a motley crew, since they’re white collar types, with a splatter of talents, areas of expertise, and varying willingness to exert much effort. This makes them uniquely qualified to discover and make connections between things that experts would probably miss. Maybe they could be tasked to be a “shadow company” that analyzes and reacts to the key initiatives underway inside Ford…giving the company a sounding board in reality that it clearly needs.
The point would be to avoid predetermining what disruption looks like, or where it will come from. The more clueless the group was about how change would occur, the more likely they might be to actually discover it.
Axing them is going to cost a bundle anyway, and maybe you let the angriest ones leave with a check. But I bet a solid majority of them would want to get paid for doing something more meaningful than walking away.
For instance, what if it made sense to consider ways to make sure every current Ford owner was a Ford owner 5 years from now? What would it take? What could Ford do to engender that level of confidence and commitment?
The disruptive answer(s) for Ford might have little to do with technology, which will be common across platforms sooner vs. later, just like it always is in most industries (automotive included).
Taking off the limitations of working in a big company might be empowering, and all those zillions of hours of work and life experience (and maybe even residual affection for the company) might enable an entirely new, unforeseen, and therefore truly disruptive future for Ford.
Don’t fire the 1,400. Free them!