Teams, Turnover, and Transformation

May 30, 2023 | Article, Building Cohesive Teams, Building Cohesive Teams Public

No matter the organization, everyone loves to talk about ‘Teams’. But there’s another t-word that no one seems to love; ‘Turnover’. Team members and Leaders alike fear the hard conversations that lead to someone quitting or getting fired, but turnover is a reality and it can be handled in a healthy way. In fact, it can lead to more than just balancing the budget or silencing embarrassing conflict. If you approach turnover in a healthy way, it can lead to Transformation.

One of the healthiest examples of this dynamic comes from the Ford Motor Company. In the fall 2008, their new CEO, Alan Mulally, showed up for his first day on the job. The assumption was that he would show many people the door and bring in ‘his own people.” When asked this question by a reporter he surprised everyone by referencing the existing executives he inherited and saying, “this is my team.” He knew the power of continuity and didn’t want to perpetuate a culture of dysfunctional churn.

Within Alan’s first 4 years, Ford faced the threat of bankruptcy, an economy in crisis, and countless other external threats to one of America’s oldest giants. During that time, Alan kept his promise and retained most of his initial senior team (~75%). Within that group are many executives who experienced their own transformation. However, he also oversaw turnover with other executives too. Here’s some interesting profiles of leaders who experienced turnover and one who experienced transformation.

Mark Shulz, VP of International

Mark was a high-powered leader like his peers. He oversaw the international operations for Ford. He was busy flying all over the globe to keep the lights on and didn’t need any babysitting to do his job.

Mark was also leading his own silo. He wasn’t interested in getting help, or offering help, to his colleagues across the leadership team. When Mulally started holding weekly team meetings and made them mandatory, Mark pushed back immediately. Using backchannels, excuses, and other forms of passive/aggressive behavior he did everything he could to get out of the meetings. Mark wanted to be on a plane to China, not in a boardroom in Michigan.

When Mullaly finally had an opportunity to confront the behavior directly, he used a powerful, simple tact: he let Mark choose his own fate. Mulally didn’t address all of Mark’s distracting behaviors. He only addressed the high, consistent standard across the team. With great poise he simply told Mark, “sure…you don’t have to come to meetings if you don’t want to; but, if you don’t, you are not on my team.” Mulally held the standard. The heat turned up, and Mark Shulz got out of the kitchen and left Ford on December 7, 2006, about 90 days into Mulally’s tenure.

Don Leclair, CFO

Don Leclair made his own stamp on the future of Ford. Even before Mulally joined the team, he was managing one the most complex portfolios that included Ford’s worldwide brand of products, 9 other brands that Ford owned (ex. Jaguar), and Ford Motor Credit. When Alan arrived, Leclair championed an effort to secure 23 billion dollars of credit to secure Ford’s future before credit lines dried up during the 2008 crisis.

But Don had a debilitating weakness. When the sky started falling in 2008 he wanted to jump ship and take everyone with him. His analyses were perpetually one-sided and he lobbied heavily for Ford to file for bankruptcy. He suffered from what Henry Cloud calls “Learned Helplessness.” He could see no path forward for Ford and Mulally knew it. Mulally could see that Leclair was very smart, but he was not a healthy member of his executive team. And his negativity was distracting and infectious.

Since Don’s position was so key, Mulally knew that he could not just up and fire Leclair. However, as soon as he knew things were not working, he began a plan to replace him. He subtly groomed Lewis Booth and brought him over from Ford Europe to be the new CFO. With the board’s cooperation, they extended a transition plan to LeClair and he accepted.

With the exception of The Great Depression, Mullaly was entering the darkest financial crisis Ford had ever seen, and he needed a healthy team to do it. In the end, Ford was the only major car company to save themselves and reject the government bailout.

Mark Fields, President of North America

After reading these stories in succession, it’s easy to assume that many lost their nerve and became collateral damage as Ford tried to save itself and the American auto industry as a whole. However, most of Mulally’s team not only survived, they thrived and grew in the process. The best example of this is Mark Fields.

Before Mulally came, Mark was the next in line for CEO. He had already brought a team together to save Ford and was implementing a plan. So it took a measure of humility to watch Alan come in and pass him over. Alan was an outsider to the entire industry.

Fields didn’t transform day-by-day in incremental fashion. He came to a breaking point. And, in an act of vulnerability, he made a big decision that changed his fate and that of Ford’s as well.

To understand this decision, a little context is required. As mentioned, Mulally created a weekly meeting for all his top leaders. During that meeting, he asked for standard updates on every critical metric of their strategic plan (production, deadlines, finances, etc.) He asked that data be simply coded: green (good), yellow (concern), or red (at risk). Sounds simple. Here’s the twist: every team member had reported everything all green, every week. Not one leader on Mulally’s team had actually reported any areas of weakness or concern…not even one. And this is from a company approaching bankruptcy! Truth is stranger than fiction.

So back to Mark’s decision. One day, Mark was feeling a bit bold. He thought, “I’ve got nothing to lose.” The worst that could happen is he could get fired and he was expecting that anyway. So, he decided to label one, just one, area “yellow”. A new model of car was delayed in its launch. He told the team his rationale and plan to correct.

After his update the room fell silent until broken by the sound of…clapping. No, not a standing ovation from his peers. It was an audience of one: his CEO Alan Mulally cheering him on and rewarding him for his candor. Instead of losing another smart team member, Alan gained a new champion.

Years later, Mulally would call this moment one of the most critical in the Ford turnaround story. That’s quite a claim. Could healthy behavior on an executive team be the missing piece to save a company whose stock had fallen from $16/share to $1/share?

Back to the idea of turnover. Is it a reality that everyone must learn to face with fear and simply endure? Or is turnover an opportunity that can help transform an organization? In the case of Ford and Mulally’s team, it can turn stars into retirees (ex. Leclair) or naysayers into champions (ex. Fields). And as everyone came to that crisis point, they all made their own choice.

The only path Mullaly didn’t choose was passivity. He did not ignore the issues. He never let anyone sit on the fence or quietly ride out the storm. He held the same, consistent standard and forced everyone to choose their own path. Regardless of the specific timeline, it became clear pretty quickly if someone was going to be a part of the future, or the past.

Shulz chose to get out of the kitchen when it got too hot. Leclair chose to lead Ford on a one-way path to bankruptcy court (Ford never had to file for bankruptcy after Leclair left, while their competitors did), but Mark Fields showed that there were alternatives to turnover. He experienced his own transformation and became a student of Mulally’s school of organizational health. He made a choice to face the tension of turnover and realize a completely new future. A fitting path for Ford’s current CEO. Mark Fields took over for Mulally in 2014 after the great CEO retired.


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