D DAY AT FORD

[kyle]

Looks like Ford is implementing their re-org this week......

https://www.freep.com/story/money/cars/ford/2019/05/20/ford-layoffs-dearborn/3739354002/

Good luck to all affected and hope things work out!

[jcartwright99]

This is why I will never work in the auto industry. They are too cyclical with cuts/layoffs. My company does the churn and burn with the bottom 20% performers and the most costly employees (excluding mid/senior management).They will generally rehire at a much lower cost. It's pretty much expected at the end of January and September.

For anyone who gets canned/layed off today, it's sucks but not the end of the world. Take a few days to regroup and then get after it finding a new job.

[akirby]

5 direct reports or less?  That's ridiculous.  Should be at least 7-10. 

14 levels?  No wonder they couldn't get anything done.

This kind of restructuring has been happening in other companies for many years.  Ford is just late to the game.

[mackinaw]

My contacts who worked for Ford have all retired.  Talking to them though, they always mentioned the unnecessary layers of bureaucracy that got in the way of them doing their job.  Sounds like this reorganization has, finally, addressed that.  Of course, it comes at a cost.  Never easy to tell a person they no longer have a job.  I wish those leaving the company well.

[akirby]

Hopefully these are mostly executives with golden parachutes, folks who were ready to retire anyway or poor performers.

[Bob Rosadini]

3 hours ago, akirby said:

5 direct reports or less?  That's ridiculous.  Should be at least 7-10. 

14 levels?  No wonder they couldn't get anything done.

This kind of restructuring has been happening in other companies for many years.  Ford is just late to the game.

For sure on the span of control.  When I retired in 2010 I had 9.  When I joined the company, I had 4!  Nothing like a flattened org chart!  And that was my last 20 years with a private company.  When I started with my first 20+ year career in one of the largest Fortune 500's , there were probably 25 positions across the country at the level I was at when I left.   And when I left,  I was one of like 6!

 Sounds like Ford was long overdue for this, tough as it is.  

The good news is it sounds like Ford is being fair as far as severance as well as attempting to minimize the issue by getting as many voluntary layoffs as possible.

[mackinaw]

1 hour ago, akirby said:

Hopefully these are mostly executives with golden parachutes, folks who were ready to retire anyway or poor performers.

Many long-time employees were offered a sweetened retirement package.  My last Ford contact who worked in EV's (and her husband) were both offered a package they couldn't refuse.  They left on December 31st.  She worked at Ford about 30 years.

[akirby]

32 minutes ago, mackinaw said:

Many long-time employees were offered a sweetened retirement package.  My last Ford contact who worked in EV's (and her husband) were both offered a package they couldn't refuse.  They left on December 31st.  She worked at Ford about 30 years.

We went through those enhanced retirement packages between 2000 and 2012 or so.   Back then there were some really sweet deals.  Since then it’s basically up to 6 months pay and that’s it.   Still more than you’d get if you just retired on your own.

[fuzzymoomoo]

2 hours ago, akirby said:

Hopefully these are mostly executives with golden parachutes, folks who were ready to retire anyway or poor performers.

It's mostly middle management by the sound of it. Don't think there's much in the way of golden parachutes in that level. 

[akirby]

18 minutes ago, fuzzymoomoo said:

It's mostly middle management by the sound of it. Don't think there's much in the way of golden parachutes in that level. 

Those would fall into the 2nd and 3rd categories, not the first one.

[fuzzymoomoo]

I wonder if the layoffs will effect plant level management too. Ever since I've worked here I've always felt there was too many decision makers and it was hard to make opinions heard, even when we're asked for our opinion. 

[jpd80]

It sounds like Jim Hackett is actually doing what Alan Mulally pretended to do, dismantling fiefdoms that grew from all the excessive levels of management. My concern is who actually prepared this study on changes and driving it - what's their angle, keeping their own little corners?.

 

I watched the video of Jim Hackett in the link, he made a great point,

Quote

I think the no 1 thing in the auto industry is the capital that's required to build a new model makes a barrier that you have to be certain of success  before you spend it. So it causes the company to do mutations of older platforms that have served their usefulness and stay with them because the risk is less.  It's like doing sequels of movies, how many versions of Ghostbusters do you want to see? 

Yay, he gets it.

That's a great analogy and why buyers want something new and fresh, not cheap and chinzy make overs designed to save money....

[fuzzymoomoo]

6 hours ago, jpd80 said:

It sounds like Jim Hackett is actually doing what Alan Mulally pretended to do, dismantling fiefdoms that grew from all the excessive levels of management. My concern is who actually prepared this study on changes and driving it - what's their angle, keeping their own little corners?.

 

I watched the video of Jim Hackett in the link, he made a great point,

Yay, he gets it.

That's a great analogy and why buyers want something new and fresh, not cheap and chinzy make overs designed to save money....

I have to admit 

 

I'm starting to like this guy 

[fordmantpw]

21 minutes ago, fuzzymoomoo said:

I have to admit 

 

I'm starting to like this guy 

[fuzzymoomoo]

2 minutes ago, fordmantpw said:

I know, it's a crazy concept these days. 

[kyle]

This would not be good but sounds like their is some merit there....

“The bottom line is that Ford’s announced job cuts are absurd," said market analyst Jon Gabrielsen, who advises automakers and auto suppliers. "No one who analyzes the Ford situation believes that 7,000 job cuts remotely scratches the surface of what will be required for Ford’s long-term longevity."

He added, "Adam Jonas, the most respected analyst in the business, estimates that Ford will need to cut an additional 23,000 salaried workers through 2022, for a total of 30,000 since late 2018. My own estimate, arrived at separately and before his report came out, indicated an additional 22,000 cuts would be needed."

https://www.freep.com/story/money/cars/ford/2019/05/21/ford-job-cuts-analysts/3754205002/

[rperez817]

20 minutes ago, kyle said:

This would not be good but sounds like their is some merit there....

“The bottom line is that Ford’s announced job cuts are absurd," said market analyst Jon Gabrielsen, who advises automakers and auto suppliers. "No one who analyzes the Ford situation believes that 7,000 job cuts remotely scratches the surface of what will be required for Ford’s long-term longevity."

He added, "Adam Jonas, the most respected analyst in the business, estimates that Ford will need to cut an additional 23,000 salaried workers through 2022, for a total of 30,000 since late 2018. My own estimate, arrived at separately and before his report came out, indicated an additional 22,000 cuts would be needed."

https://www.freep.com/story/money/cars/ford/2019/05/21/ford-job-cuts-analysts/3754205002/

Adams Jonas is correct. While the plan Ford announced yesterday is a step in the right direction, there are many more jobs that Ford will need to cut in order to become and stay "fit" long term.

For comparison, GM's Plan for Transformation reduces the size of its global workforce by 15%.

[PREMiERdrum]

6 hours ago, fuzzymoomoo said:

I know, it's a crazy concept these days. 

It's nuts, right? I think the rank-and-file will be on board before the ball drops, but my contacts have had me high on him forever and I'm glad to see you start to turn around. 

Any time things are coming behind a curve, there will be those to piss off and feelings to be hurt. Jim understood the holes that needed filled and the cuts that needed made, and most importantly, wasn't afraid to make the cuts that needed made. Ford is better off that he's there. And, as much as it pains me to say it, is better with Farley on the way out. 

[mackinaw]

57 minutes ago, rperez817 said:

Adams Jonas is correct.

Is he?  From today's Detroit News:

"In a note, Bank of America Merrill Lynch analyst John Murphy appeared to disagree. He wrote that the final phase of Hackett's turnaround gives "credence" to the slower approach for which he was criticized — most openly by Morgan Stanley's Jonas. 

"Ford has made a number of one-off announcements on various restructuring actions, which are starting to add up," Murphy wrote. "In our view, Ford's workforce reduction announcement ... illustrates that the company's ongoing efforts are very much concrete, and should start to be better appreciated by the investment community. Ford's 'Tough' days are starting to fade into the rearview."

[fuzzymoomoo]

37 minutes ago, PREMiERdrum said:

It's nuts, right? I think the rank-and-file will be on board before the ball drops, but my contacts have had me high on him forever and I'm glad to see you start to turn around. 

Any time things are coming behind a curve, there will be those to piss off and feelings to be hurt. Jim understood the holes that needed filled and the cuts that needed made, and most importantly, wasn't afraid to make the cuts that needed made. Ford is better off that he's there. And, as much as it pains me to say it, is better with Farley on the way out. 

Yeah IMO the faster Farley hits the road, the better. I've always liked Joe Hinrichs (even though I questioned a few of his decisions a few years ago) and I'm glad to see him seemingly finally being positioned to take over once Hackett decides his work is done. 

I do still have a problem with Hackett's overuse of hyperbole. We get it, you know a lot of big words. Quit showing off. 

Edited May 21, 2019 by fuzzymoomoo

[ice-capades]

We were notified yesterday that our Ford Zone Manager was let go so evidently the cuts go down pretty far. It'll be interesting to see how the reorganization affects the dealerships going forward as the Ford Zone Managers are a Dealer's primary contact on all matters. We should find out soon how many Zone Managers are left and how many dealerships they'll have to represent going forward.

If I read correctly in some of the media reports, cuts are also coming in the technology department by the end of June. Could Ford's IT could get any worse? I guess we'll find out!

[kyle]

38 minutes ago, ice-capades said:

We were notified yesterday that our Ford Zone Manager was let go so evidently the cuts go down pretty far. It'll be interesting to see how the reorganization affects the dealerships going forward as the Ford Zone Managers are a Dealer's primary contact on all matters. We should find out soon how many Zone Managers are left and how many dealerships they'll have to represent going forward.

If I read correctly in some of the media reports, cuts are also coming in the technology department by the end of June. Could Ford's IT could get any worse? I guess we'll find out!

 

Wow that is surprising since most of those guys have around 12-15 dealerships and like you said, they are the main contact for any dealer. Not sure of your volume, but maybe they are moving even mid-tier stores to a call center?

[theoldwizard]

On 5/20/2019 at 1:38 PM, akirby said:

Hopefully these are mostly executives with golden parachutes, folks who were ready to retire anyway or poor performers.

I had lunch with a fellow retiree just yesterday.  Many were NOT ready to retire even though the "writing was on the wall".  A friend of the other retiree who was in mid-level engineering management was given the opportunity to do an early retirement last.  When they declined, they were demoted and had ZERO people reporting to them !  If that is not a signal, I don't know what s !

[theoldwizard]

On 5/20/2019 at 11:17 AM, akirby said:

5 direct reports or less?  That's ridiculous.  Should be at least 7-10. 

This is really the THIRD attempt top slim down the "muffin top" !  The first was "Ford 2000" ("Blue Ribbon" committees; actually in the late 1990s).  The second happened in 2006-2007 (involuntary and voluntary "separation"; net was about a 33% reduction in white collar, including myself).

As for "span of control", in the 2000s, I worked for an engineering manager who had about 20 "direct reports".  When he got the dreaded "special assignment" (go watch paint dry), he was replaced by 2 managers.

[theoldwizard]

On 5/21/2019 at 4:01 AM, jpd80 said:

It sounds like Jim Hackett is actually doing what Alan Mulally pretended to do, dismantling fiefdoms that grew from all the excessive levels of management.

Don't blame Mulally, The 33% reduction in white collar was BRUTAL !  It was Mark Fields who basically did NOTHING and allowed the fiefdoms to rebuild.