There’s one question that’s almost ridiculously obvious to ask. And yet, in so many meetings no one dares to ask it. It’s this:
→ Wait a second, what’s actually true right now?
When Alan Mulally took over as CEO of Ford, the company was a mess. They were heading toward a $17 billion loss.
But that wasn’t their biggest problem. Because most problems can be fixed.
As long as you know what the problem is.
Not knowing that was Ford’s problem.
They were using the infamous traffic lights system that every team on this planet hates. And they were the quintessential example for why everyone hates it.
Mulally tells a fascinating story about his experiences with it in this video from a Stanford lecture.
In their progress meetings, they had only green charts.
Not a single issue was marked.
Not a single risk was marked.
Nothing.
It was all green.
Now, that is obviously BS (and everyone knows it). But the culture at Ford was so broken that no one dared to flag an issue. Everyone thought that when you flag you get made responsible for it. And you don’t want to live through the consequences of that.
So, even the most senior team members, masked issues to make them appear green.
The brilliance of Mulally wasn’t that he found the solution for the $17B loss. It was that he changed the demonization of the colors red and yellow.
At one point, he stopped the meeting and asked the line you see in the visual.
You should really watch the video I linked to above. He’s a great storyteller and the way he tells how the situation unfolds is hilarious and eye opening at the same time.
A few more words from Mulally:
“You weren’t red, the issue you’re working on is red.”
It’s a leadership failure if you confuse the two.
“The data sets you free, right? Data tells you everything.”
Honestly, I take this as a shot against the storytelling industry. Stories are great if they serve the data. They are terrible if they dilute it. The spin we saw at Ford was storytelling at it’s worst.
“You can’t manage a secret. People can’t help if they don’t know what the real situation is.”
As it turned out, people were happy to help. Which is what ultimately turned Ford around. Because together you can achieve more than anyone ever could alone.
What happened after that pivotal meeting?
A few weeks later the charts looked like a rainbow. Not because things got worse, but because people finally told the truth.
And so, that meeting was the turning point. The moment Ford stopped pretending and started facing the truth.
In 2009 Ford reported a full-year net income of about $2.7 billion.
That is the power of a leader who makes it safe to show what is true.
Keep lighting the path,
Michael
PS: The latest issue of “What the Best Leaders Say” goes deeper into the same question that unlocked the Ford turnaround. What is actually true right now? If you want to explore how leaders surface truth without fear, here’s the link.
