Free American Icon by Bryce G. Hoffman Page B

The outside directors also cut their own compensation.
    In July, Toyota outsold Ford in the United States for the first time ever. By then, Fields had reassembled his Way Forward team and begun work on an even more aggressive downsizing plan. They spent the summer locked in lengthy meetings trying to figure out what else they could cut. More factories would need to be closed, more jobs would need to be eliminated, and Ford would have to abandon its pledge to return its North American automobile business to profitability by 2008. Even with another round of cuts, that was no longer possible. Instead of coming up with another catchy slogan, they simply called the new plan the “Way Forward Acceleration.” Most people referred to it a little more ironically as “Way Forward II” and whispered that “Way Forward III” was already being discussed at the top of the house.
    As they struggled to go further faster, Fields began running into the same old brick walls that had held back change for so long at Ford. Entrenched executives gave superficial support to his turnaround efforts but often conspired against them whenever his plans ran counter to their own aims. Ford’s rigidly regionalized corporate structure made it impossible for Fields to address issues globally. Fields thought his mandate from the board would prove unassailable. When he realized how wrong he was, he appealed to Bill Ford to make good on his promise to protect him. But Bill Ford had not been able to protect himself. Meetings became tense as tempers flared, and the worsening business environment only served to fan the flames.
    It all came to a head during an off-site meeting that summer. The company’s top executives had cloistered themselves in a conference room at the Henry Ford Museum so that they could work on the accelerated restructuring plan without interruptions. Fields had been fighting with Leclair ever since the CFO vetoed his Bold Moves initiatives. Now Leclair was insisting on even deeper cuts to Ford’s advertising budget. Fields refused.
    “There’s no other alternative,” Leclair insisted. “You’re going to do this.”
    “When you run the fucking business, you can do it,” Fields fired back. “But you don’t run it. You’re the CFO. So, I’ll take your counsel, but that’s it.”
    “You’re going to do this!” Leclair shouted.
    Fields leapt out of his chair screaming, “I’m tired of this bullshit!”
    He was halfway across the table by the time Bill Ford grabbed him.
    “Cut it out!” Ford demanded.
    Scenes like this hampered Ford’s progress on the Way Forward II plan. So did the chronic lack of honesty inside the company. The plan’s goalposts kept moving as Ford’s position in the market deteriorated.
    “The budget changed constantly,” recalled one executive. “Nobody knew where the money was. Nobody knew how much spending was actually going on. Everyone was trained to pad their budgets and their projected expenses so that they could line them up at the end of the year.”
    As truck sales continued to tumble, Fields began putting together the biggest production cut in two decades. It called for a 21 percent cut in fourth-quarter factory output, as well as additional cuts to third-quarter production. Ten factories would be idled for extended periods, and some 30,000 workers would be temporarily laid off. However, by the time the cut was announced in September, it was clear that far deeper cuts would be necessary.
    Though Fields kept talking about matching production to the actual demand for Ford’s cars and trucks, it was now evident that neither he nor anyone else at World Headquarters had the stomach to actually do it. He and his team had tried to take an unflinching look under Ford’s hood, but they still suffered from the same failure of imagination that had plagued Detroit for decades. Fields knew that Ford needed to change or die, but he was unable to recognize how deep and sweeping those changes needed