Ford's Secret Power Conquered Ferrari. Hail Middle Managers!
When we talk about corporate innovation breakthroughs, what comes to our mind are charismatic figures, such as: Steve Jobs, Jeff Bezos, Elon Musk. They are the founder or CEO of the company. Prestige is misleading, deceiving because the reality is that the breakthrough innovation that succeeded in saving the company from destruction actually came from employees at the Intermediate level. Who do you think brought the motor company's default innovation to life at a time when the legendary brand was starting to lose its fangs in the market? Who saved the Xbox from the onslaught of Sony PlayStation. Who contributed to Apple's fantastic corporate turn-around. The answer is not the founder or CEO. This is the story of how those in the middle appear as company heroes. Check out the story of Ford's secret power conquered Ferrari. Hail Middle Managers!
Chapter One: THE DECLINE OF FORD
In the early 1960s, Ford Motor Company experienced a significant decline in sales due to several of their products that failed in the market. And at the same time rival products from GM and Chrysler were increasingly popular with customers at that time. The CEO, Henry Ford II, who is the eldest grandson of the founder Henry Ford, has started desperately looking for ways to improve the situation. The spending behavior of the American people at that time was changing as the baby boomers got older. Generations born after World War II, for the first time in history, are more important to American businesses than their parents.
Bombers have a lot of income that can be spent on things, such as: cars, clothes and houses, unlike their parents who are used to living frugally because they have been through The Great Depression and World War II. This new generation, willing to buy expensive goods as long as it is unique. Speaking of vehicles, they want a car that is more beautiful and sexy. A car that prioritizes speed and performance over comfort and reliability.
Chapter Two: THE PROPOSAL THAT MADE FORD
Ford executives, including Lee Lacocca, who was then General Manager, believed that sports cars were the answer to declining sales conditions. Ford needs to rebrand itself as a contemporary vehicle, which fits the aspirations of the current generation, not the vehicles of their father's previous generation. Unfortunately, Ford doesn't have a sports car in its portfolio and there are no plans at all to make a sports car. So, Lee submitted a proposal to Henry Ford II to buy Ferrari, an Italian sports car manufacturer that was currently experiencing financial difficulties. Initially, Ford management rejected Lee's idea.
"Ferrari is nothing compared to Ford" was their view. The number of cars that Ferrari produces in one year is equal to the sales of Ford cars in one day. In fact, if you watch the film Ford versus Ferrari made by James Mangold which was released in 2011. Leo Beebe, a confidant of Henry Ford II mocked Ferrari by saying that "Ford spent more money on toilet paper than the total output made by Ferrari".
Chapter Three: FORD'S WAR AGAINST FERRARI
Lee Lacocca did not give up, he argued that it was not Ford that Ferrari would be the best car manufacturer in the world. Not from the sales of Ferrari, but because of the meaning presented by a Ferrari car. Ferrari means victory, as they have proven time and time again in the world's most prestigious auto race (24 Hours of Le Mans). Henry Ford II finally agreed to Lee's proposal to acquire Ferrari. So, in the spring of 1963, tough negotiations between the Ford and Ferrari delegations continued for months. But, when the deal was started, Enzo Ferrari decided to back off. The reason is that he will lose full control over decisions regarding the Ferrari racing team, if he signs his contract.
Rumor has it that Enzo was offended by Ford's offer and then expelled the Ford Executive Team and also insulted Henry Ford II personally. The incident sparked the anger of Ford II who then decided to wage war against Ferrari, his target was to embarrass Ferrari at the 24 Hours of Le Mans.
Chapter Four: BUILDING THE FERRARI KILLER
The task of building a race car that is predicted to be the Ferrari Killer was given to the Ford Advanced Vehicle Group in the UK. The result was a Ford GT40 that was able to move very fast, but the car was still unstable and unreliable. Ford decided to enlist the help of legendary car designer, Carroll Shelby to become a consultant on Ford's race car production and run racing operations. Shelby is the only American racer to ever win at Le Mans.
Shelby then asked his friend, an engineering specialist named Ken Miles to redesign the GT40. Mies was initially reluctant to get involved in the ambitious project. According to Miles, Ford would never have allowed Shelby to make the car he wanted, too much interest.
"They're not people who take risks, unlike you," Miles told Shelby. You are different from them, they don't like being different. and yes, the complexity of the bureaucracy and the tug of war within Ford kept the team from achieving their best. Ford lost to Ferrari at Le Mans for two years in a row, 1964 and 1965. Henry Ford II was furious after the millions of dollars he spent, Ford still could not match Ferrari's superiority in the Le Mans racetrack.
Chapter Five: THE DECISION THAT WON LE MANS
Henry Ford II then made a big decision that changed everything. He put full trust in Shelby and his team to manage the racing team. No more bureaucracy. Shelby immediately reported to Ford. Shelby moved quickly. So, from the cold hands of Ken Miles and his team, the Ford GT40 mark II was born, the latest modification of the Ford GT40 racing car. And with that model, Ford not only beat Ferrari at Le Mans in 1996, it embarrassed the Italian horses.
Meanwhile, none of the Ferrari race cars finished the race. Three Ford GT40 Mark II cars won first, second and third place. And for the next three years at Le Mans 1967, 1968 and 1969 Ford won the most dangerous and prestigious race at the same time.
Chapter Six: THE POWER OF MIDDLE MANAGEMENT
Ford beat Ferrari not because of the greatness and great vision of the founder or CEO, but because Ford has Middle managers who dare to think wildly and are not afraid to express their opinions to the leadership. Although, people on the right and left want to be safe and choose to be "yes man". Lee Lacocca and his colleagues in Middle management were able to drive a radical and innovative initiative and strive for it to be truly successful.
In the midst of the pessimism of the people around him who think his initiative is impossible to achieve. Middle management has a unique position, they are in the middle between the strategic direction and operational workers. Research shows that middle management is a position that has the highest stress level. It's definitely not easy to be a bridge between top leaders who think to the sky and field workers who struggle with problems every day because reality is never as beautiful as planned.
Often the middle management ends up being the target of fire or even being completely ignored. In fact, they should be seen as a key resource that must be developed. That's according to Paul Osterman, Professor of human resource management at the MIT Sloan School of Management. Studies show that "when the company is able to empower this middle management properly, then miracle after miracle will occur in the company. The story of Ford vs. Ferrari is a vivid example.
Brian Elliott, executive Lead of the future forum In his May 2021 Harvard Business Review article entitled “It's time to free the middle manager” said that “the traditional role of a Middle manager is to monitor team performance, optimize individual productivity and so on. But, being increasingly unnecessary with the presence of digital technology that allows the flow of information to move more freely and democratically.
Now managers can focus on something much more important than just channeling information: building teams and connecting the people who are the lifeblood of an organization.
Chapter Seven: THAT MIRACLE LIES IN THE MIDDLE
Ford is not the only company that has middle management capable of being present as the savior of the company, in fact they exist in every company. It's just that they are not very visible and are covered by the charisma of the founders and CEOs. but believe it or not, these are the employees at the middle level who are present as heroes in the company.
Alex Kepmen, a Technical Velo at Microsoft, contributed greatly to the Xbox's ability to survive the onslaught of Sony's PlayStation. Kepmen created the Kinect, a motion sensor device that allows players to interact with the game using their own body without the aid of a controller. When it appeared in 2010, the Kinect sold 8 million units in just 60 days. It earned him a Guinness World Record for the Fastest Selling Consumer Electronics Device.
Although, production of Kinect was discontinued in 2017 due to privacy concerns, the Technology developed by Kepman and the team at Kinect is now powering Microsoft's revolutionary products. Including the Hololens that we use to enter the Metaverse. When Steve Jobs returned to Apple in 1997, Jonathan Ive or better known as Jony Ive, an industrial design engineer who worked at Apple, became Vice President of Industrial Design. Since then, Iconic Apple products have been born, such as: colorful iMacs, iPods, iPhones and iPads.
The turn-around of Apple's nearly bankrupt personnel to become the most valuable company on earth would not have happened without Jony's contribution at these critical times. Jony has turned Steve Jobs' vision of technology into something beautiful. It is undeniable that Jony has made Appel what it is today. Without his intervention, Apple products would not be as simple, intuitive and beautiful as they are today.
The three people in this article: Lee Lacocca, Alex Kepmen and Jony Ive are neither CEO nor founder. They are employees at Intermediate level. They are fully empowered by the company. And in return they present a miracle. So, if you are the head of a company, make sure you provide ample space for your best people to work, to make a difference.
Trust them, support them, and if you are currently in the middle of being part of middle management, this is your moment. Don't just look for safety, don't be "yes man". Dare yourself to take big steps. Voice your breakthrough ideas, strive for them. Prove that you are the company's most valuable asset.
Meanwhile, for those of you who are just starting a career, never count. Just give and give. Show your best performance whatever the conditions. There will be people who will feel threatened by your achievements, there will be people who will ridicule you, let that be all. Remember, your self-worth is determined by your works, not by the words that come out of the mouths of jealous people.
Reference: https://youtu.be/sK7KEGesATs
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