When the pandemic first began last year, a CEO asked me an intriguing question: “If you could tap anyone to lead a company through an existential crisis like this, who would it be?”
“That’s easy,” I said. “Alan Mulally.”
Mulally is the only person I know who has saved not one, but two iconic American companies: first Boeing, then Ford. He was also the subject of my first book, American Icon, and I am proud to call him my mentor.
I recently had the opportunity to sit down with Alan and ask him how you deal with challenges like the ones so many businesses and governments are dealing with today.
“It starts with really facing reality – not what you wish it could be or hope it could be,” Mulally told me.
He said the challenges posed by the coronavirus pandemic are not that different from the ones that confronted him as president of Boeing’s Commercial Airplanes division back in September 2001, when the 9/11 terrorist attacks prompted many of the world’s airlines to cancel or delay their orders for new jets.
“We started meeting immediately, analyzing the situation and the environment, and looking at what it meant to us near term – and also what it meant to us longer term. We knew right away that this was going to affect people's confidence and their desire to travel, and we knew that was going to mean that we didn't need to produce all the airplanes that we were producing at that time,” he recalled, adding that Boeing’s deliveries of new planes fell from about 620 to just 280 over the next 12 months. “No company that I know of has ever suffered that kind of a reduction in their volume, their throughput, and survived. It’s just very hard to react fast enough to constrain the cashflow expense.”
But thank to Alan’s leadership, Boeing didn’t just survive, it thrived. By the time he left to go save Ford Motor Co. five years later, Boeing’s shares had not only recovered, but were now trading for almost $30 more than they had been before the terrorist attacks.
“We start with people first. We’re going to include everybody, all the stakeholders: the airlines, the traveling public, our employees, our suppliers, the investors, the unions. Everybody was going to be included,” Mulally said. “Also, we were going to come together around a compelling vision, a comprehensive strategy for achieving it – and not only the technical strategy, but the working together strategy, the partnership strategy. And we were going to follow a very reliable, relentless implementation plan, which is the Business Plan Review.”
The Business Plan Review, or BPR, Process revolves around a weekly meeting at which each member of the senior leadership team presents a short update on their part of the business using color-coded slides. Things that are on-plan are green, things that are off-plan but being dealt with are yellow, and things that are off-plan but not yet being addressed are red.
“We’re going to treat those greens, yellows, and reds as gems. (They show us) what the problems are, so we can work together and turn the reds into yellows and the yellows into greens,” Mulally explained, adding that having these clear performance goals and focusing on facts and data goes a long way toward removing politics and personality from the management equation. “The attitudes and the behaviors are really, really important: Propose a plan, find a way, respect each other, listen to each other, help each other, appreciate each other.”
What Alan pointedly did not do at Boeing was change the way he ran the company or alter the long-term strategy.
“We matched the production to the real demand. We dealt with the restructuring to do that. We treated everybody with respect and compassion. We shared what the plan was, what solutions we were considering, and we got everybody's ideas and then implemented it together,” he said. “But at the same time, we also decided that what the world wanted next was an airplane smaller than the 777 to go point to point and nonstop halfway around the world. So, even during this crisis, we committed to invest in the development of the new 787.”
This calm, focused approach allows leaders to cultivate the emotional resilience necessary to navigate through crisis.
“The role of the leader is as a facilitator, as a coach, holding themselves and everybody accountable to following the process and the behaviors,” Mulally told me. “People always said, ‘How do you sleep at night when all this was going on?’ And I said, ‘I sleep really well because we’ve just gone over all the issues. We know the plan. We know the areas of special attention. And everybody's helping each other turn the reds and yellows to green. The most important thing I do is go home, get some sleep, and come back with the energy and enthusiasm and working together – because I know that, if we work together this way, there’s nothing that we can’t overcome!”
Alan says the same is true of America today.
“Coming together around a vision and a strategy for our country to deal with both the virus and the economy is the most important thing that we can do together,” he said. “If you get all the talented people together that can help, and you come together around the vision, the strategy, and the plan, then there is nothing – and this is especially true of the United States – there is nothing that we can’t overcome and turn a horrible situation into an even a stronger country going forward for all of us.”
Listen to the interview on The Thinking Leader podcast wherever you listen to podcasts!