Risks Of Ford's F-150 Relaunch

The best-selling vehicle in the U.S., the Ford F-150 pickup truck, is about to undergo a dramatic change. In 2015, it will largely be made of aluminum. Up to now, aluminum vehicles have been a small niche in the U.S. not available to the majority of car buyers.

Like any new technology, it faces some big risks. While undoubtedly extensively tested in advance, unanticipated problems or irrational customer concerns might still arise. The vehicle will get better mileage being about 320 kilograms (700 pounds) lighter. But will it handle the same or, if not, will enough customers still like it? Will it be more durable or less in every respect, or durable in a different way (more prone to scratches but less prone to dents)? Will it cause side view mirrors to fall off? Will the aluminum cause some people to have their hair fall out faster?

The challenge is that ALL vehicles have problems and ALL people have problems. The tough part is finding out if the two are related and, secondly, which ones are due to the aluminum versus those that always happen. (Some side view mirrors do fall off new vehicles today and some people do have a lot of their hair fall out especially among the men who are the primary buyers of these trucks.)

But for Ford the problem is even greater given the entire auto industry has a spotty reputation when it comes to admitting to its product problems as demonstrated over the years. With lower levels of trust, people will more likely automatically discount what Ford or anyone else associated with the industry has to say when problems arise.

What to do? The right way for anyone introducing a new technology to proceed is:

  • Set Expectations: Aggressively educate the public on the vehicle before and during its launch. Yes there are benefits but there are inevitably drawbacks too with any new technology. And some differences might not be better or worse, but simply different. Tell the customer before they buy.
  • Managing Quality Becomes Far More Important: Closely monitor through an effective Total Quality Management/Six Sigma programs the quality and characteristics of the new materials, body panels and components being produced. Given the unprecedented number of the aluminum panels and components manufactured for this new application, the initial production processes are likely to have greater variation than existing ones for steel and the steel panels and components. It's critical to have the programs in place to measure and record these variations, understand the root causes, and take corrective actions to ensure manufacturing processes are under control.
  • Be Ready to Stop: Delay the launch or stop production once it is running if manufacturing processes are out of control based on your Total Quality Management Program, or any problems arise that might be or are perceived to be systemic. This is not a decision to be made by senior management if they have not been spending the bulk of their time on the product throughout its development. Research we led clearly shows those close to the development of the product—the ones spending virtually full-time on it—need to be in-charge.
  • Don't Plan to Debug After Launch: Ford President and CEO, Alan Mulally, spent most of his career developing and launching airplanes at Boeing built primarily of aluminum. He understands far better than most what will and might happen next. Virtually all new planes have faced initial problems after entering into service (or Initial Operational Capability if it's the military) including those using well-established materials in a new application.
    But airlines are highly sophisticated buyers and have the technology experts—through their maintenance and repair staff—to work with the aircraft manufacturer, understand the nature of the problems, and quickly develop and implement solutions. The customers —airlines—are experts closely involved throughout. On the other hand, most car customers won’t have this level of knowledge or expertise, or be closely involved in post launch fixes, and are, as a result, going to be far less sophisticated in their response to problems especially for a largely revamped product. Don't plan to debug after the launch, instead test, test and re-test each initial unit before it is sold.
  • Assume People Will be Irrational (and Reasonable): There is considerable science demonstrating that we are not very rational, that we frequently use facts or experiences to confirm what we feel whether they reflect reality or not. So in addition to be able to talk about the facts, be ready to sooth people. Remember that people can be very reasonable if the situation is fully explained. Most customers understand new models tend to have more problems than established ones. Explaining any problems in this context will make them more sympathetic and patient—so long as they see that progress is being made.
  • Minimize Chances for Other Problems: When you are dealing with a new technology in a complex product like vehicles don't make your life more complicated by having additional problems with unrelated features and functions that undermine the overall perception of the product. In other words, if you are Ford, make sure the engine, controls, assembly (fit and finish) and other aspects of the vehicle are perfect so you aren’t distracted by a recall unrelated to the new material or technology that, in turn, undermines confidence in the overall product and damages the brand. The Boeing 787 Dreamliner is an example of too many changes to the product (beyond using carbon-fiber materials for the fuselage and wings more extensively than ever before) resulting in multiple unrelated problems.
  • Keep Designing: When the latest generation of the Honda Civic was launched it was widely panned. This forced Honda to do a mid-model overhaul of the vehicle to reestablish its competitiveness. Identify the weaknesses of the current product, start to design the next to develop solutions, and be prepared to implement these solutions.
  • Keep Manufacturing What Works: Continue producing the current product just in case problems with the new product cannot be resolved in a reasonable timeframe or customers demand the old one. (Remember "New Coke" which was launched then ultimately withdrawn when people demanded their "old" Coca-Cola back). There is precedence in the automotive industry―the ninth generation of the Chevy Impala is being produced through mid-2014 even though the tenth generation was launched in March 2013.
  • Act Quickly: When there is a problem—related to the technology or not—do everything possible to correct it especially with initial buyers until the product becomes established. Make sure to respond especially quickly to those posting comments across popular social media networks.
  • Be Ready to Provide Temporary Solutions: Ford should make it easy for customers to contact them directly and immediately if they have a problem. They should be ready to provide emergency roadside service and offer free rentals and accommodations if needed for initial customers until the public and potential buyers become comfortable with the product. As has been demonstrated repeatedly in many industries and in many situations, people respond very positively when companies takes exceptional measures to solve problems even if those actions are limited to an initial product launch. People in Long Island perceived Con Edison very positively when they had a major and prolonged power outage several years ago because the utility provided free prepared meals, generators and just about anything else to make them comfortable.
  • Have a Great PR Firm: A firm or firms that know how to respond to the media if serious problems arise are invaluable. And it might not be your current one if they don't have the right experience and people for something this complex. The Con Edison example above offers an important lesson regarding PR and the media. Those that saw the media coverage about the event generally had a very negative impression of Con Ed and how they handled the power outage. This was directly opposite to those who directly experienced the outage and the extraordinary steps the utility took. Failing to manage the message in the media through effective PR can undermine all the great work you do to fix even the worse problems.

At its core managing the introduction of a dramatically new technology is an intense total team effort that is often unprecedented for an organization. Engineering, branding, manufacturing, product development, design, corporate communications, research and development, finance, legal, customer service and the senior leadership team must be working as a tightly integrated team, typically much more so than normal, in order to identify and fix problems quickly. And with that comes a benefit that will last far beyond the launch: by breaking down the corporate silos and building relationships across the organization, a more effective and efficient one will emerge. So even if things get tough, keep in mind that after it passes you will be better than ever before.

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