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Developing Accountability

Many Lean affectionados revel in there affection for Toyota while McDonalds is another great model for the attributes of Lean. You need to look at both how McDonalds operates internally and how as an organization they have morphed and evolved from being a kid centric marketing strategy to now being a social hub for seniors.

Daily Report-Outs are my number one pillar for keeping teams focused, concerns addressed and insuring people can meet those daily targets and celebrate success. This works amazing and delivers outstanding results when the discipline is followed with a single facility. Several years ago, i had the opportunity to witness Alan Mulally in action shortly after he took charge of Ford.

So how does an industry outsider like Mulally come into a company as large as Ford - with its 205,000 employees, multiple product lines, and international operations - and straighten it out?

"Communicate, communicate, communicate," Mulally explained in one of his notes to me. "Everyone has to know the plan, its status, and areas that need special attention."

The Thursday project update meetings are held in what's known as the Thunderbird Room, one floor below Mulally's office, around a circular dark-wood table fitted with three pairs of videoscreens in the center. Eight clocks, one for each Ford time zone, are mounted on the wall. There are seats for 18 executives around the table, with additional ones on the perimeter ("Here's where I sit," says Mulally, indicating a chair: "Pilot's seat").

There are no pre-meetings or briefing books. "They don't bring their big books anymore because I'm not going to grind them with as many questions as I can to humiliate them," Mulally says. "We'll see them next week. We don't take action - I'm going to see you next week." No BlackBerrys are allowed, and no side conversations either - Mulally is insistent about that. "If somebody starts to talk or they don't respect each other, the meeting just stops. They know I've removed vice presidents because they couldn't stop talking because they thought they were so damn important."

Mulally instituted color coding for reports: green for good, yellow for caution, red for problems. Managers coded their operations green at the first couple of meetings to show how well they were doing, but Mulally called them on it. "You guys, you know we lost a few billion dollars last year," he told the group. "Is there anything that's not going well?" After that the process loosened up. Americas boss Mark Fields went first. He admitted that the Ford Edge, due to arrive at dealers, had some technical problems with the rear lift gate and wasn't ready for the start of production. "The whole place was deathly silent," says Mulally. "Then I clapped, and I said, 'Mark, I really appreciate that clear visibility.' And the next week the entire set of charts were all rainbows."

Richard's Observation ... no time was spent discussing "Green" projects since they were on track, Yellow & Red tagged projects spurred significant discussion to either kill the project or decided how it could be coached back onto the rails. This optimized people's gift of time and talent where it was truly needed.

"If something is off-track, we are much better at identifying it and resolving it," says CFO Booth. "Not everything turns to green. If it doesn't, we have to modify the plan."

Daily update meetings were also facilitated from the Thunder Bird room.

Richard's Observation ... This meeting transpired with military precision. Alan arrived at 7AM sharp and went through reviewing key metrics regarding Health & Safety, Quality, Production ... each plant was already on-line into the Thunder Bird Room and if a plant was either in a Yellow or Red condition a scribe quickly updated the wall chart. Performance metrics were also updated as the conversation progressed. Most impressive is that with 35 minutes all plants had reported and all charts had been updated.

Alan started his meeting promptly and he was not concerned if his team had arrived or not. Even if a member came slightly late they would still be held accountable. So surprise seldom was anyone late.

To monitor operations during the week, Mulally can visit two adjacent rooms whose walls are lined with 280 performance charts, arranged by area of responsibility, with a big picture of the executive in charge in case there are any doubts. Everyone at the Thursday meeting gets wall space. Mulally spends 30 minutes explaining the charts to me, making sure I stand 20 feet away so that I can't see any of the data. The message, though, comes through clearly: Mulally has his finger on every piece of this large and complex company. So does his board of directors; they see a subset of the same data. There are no secrets at Ford anymore. "This is a huge enterprise, and the magic is, everybody knows the plan," says Mulally.

“To use a disciplined business review process that continuously assesses the business environment, updates our strategy and plan accordingly, and relentlessly drives execution and performance individually and as a team”

We have shared this with you before … running a business is actually pretty simple …

• Make your plan

• Work your plan

• Meet your numbers

You can make it work within one facility or across multiple sites, you just need focus and then communicate, communicate an communicate.

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