What specifically was accomplished in this process?
More than 80 percent of our managers will have healthy spans of control of six or more direct reports, up from 35 percent before Smart Redesign;
Our average span of control for managers has increased from five direct reports to more than seven and we have reduced management bureaucracy by one third;
By year-end, most of the organization will be structured with nine layers or less, resulting in a flatter and more agile team. At the beginning of the redesign we had up to 14 organizational layers;
We identified more than 5,000 concrete ideas to change the way we work – identifying new initiatives as well as work that was not value added;
We created the new Enterprise Product Line Management organization, which will ensure we manage our product lines end-to-end for maximum customer centricity and profitability, as well as our Customer Experience group.
We also created the International Markets Group, to focus on the customer and ensure these markets receive the attention they need to thrive and grow;
Each skill team fundamentally redesigned their work. For example, Product Development created a new vehicle architecture and testing team, a new systems engineering and design assurance group, and expanded future investments for in-vehicle infotainment, software, electrification, and other areas.
Overall, by the end of the process later in August, we will have eliminated about 7,000 salaried positions or about 10% of our global salaried workforce. Within that total, and consistent with our goal to reduce bureaucracy, we will have reduced management structure by close to 20% resulting in annual savings of about $600 million.
Will there be more separations? When?
- The redesign in the North America will continue through June and we do expect that there will be some separations as those teams conclude the final design. Timelines in other regions vary but we are targeting to complete most of our global work by the end of August.
If you have created new organizations, does that mean you are also hiring new employees while others are being let go?
- As we have said from the beginning, Smart Redesign was a process to help us succeed in our competitive industry, and position Ford to win in a fast-changing future. This redesign allowed us to focus on the most valuable work which included creating new teams and in some cases, bring on new talent to help us achieve this future.
Given other auto companies' recent announcements, does Ford’s plan go far enough?
- Yes. We believe we are taking the right measures to help us create a more dynamic, agile and empowered workforce, while becoming more fit as a business.
Is this the end of the actions?
- The redesign efforts are expected to conclude in June for North America. Other parts of the world will take longer based on a variety of factors. However, this does not mean we are done evolving our business. The goal of this exercise was to reduce layers, create healthier spans of control, decrease bureaucracy and make our organization more fit for the future. We will continue to keep those objectives front and center as we constantly assess how we can be a more efficient, effective and responsive company.