Applying organizational learning theory and practice

Self-Evaluation -- Teamwork, Innovation, and Creativity

Ford as an Example of Business Creativity and Innovation

Current Ford Motors CEO, Alan Mulally, provides a contemporary example of a corporate leader who has successfully applied business creativity and Innovation in connection with his recent assumption of leadership at Ford. First, Mulally immediately recognized the long-term value of a brand that the company had discontinued: the Ford Taurus. Mulally issued instructions to reintroduce that product line immediately because he understood the remaining value of a product line in which the company had (successfully) invested so heavily for two decades. Mulally was intellectually creative enough to recognize that the lagging Taurus sales that had led to its discontinuation was a direct function of choices about the last few production models of that line and not any weakness in the brand itself. Mulally first directed that the company first designate a new Taurus from its existing model inventory immediately and, second, that the product development team then implement the necessary engineering and redesign changes to make that new Taurus the most innovative new car on the market within the next two model-years.

Mulally also demonstrated creative thinking in his decision to divest the organization of some of its substantial holdings, such as the Land Rover and Jaguar brands. He knew that recouping the financial assets was important for the company even if the $2.3 million sales price was significantly lower than their purchase price. Mulally recognized that the current economic climate and instability in the price of Middle Eastern (i.e. OPEC) would significantly and negatively impact the luxury vehicle market. Mulally also demonstrated creative thinking in his realization that the amount of equity lost in the difference between the purchase price and selling price of Land Rover and Jaguar was already "lost" before the decision about divestiture. He realized the importance of comparing the costs and benefits of retaining those product lines and divesting them at their current market value and completely irrespective of previous changes in value.

Finally, Mulally also demonstrated prescient awareness in terms of innovation of new marketing techniques. Specifically, Mulally recognized the connection between the newest communications media and the degree to which some of the company's product lines are intended to appeal to members of the target market segment that are most readily reachable through digital social media. Ford implemented social media campaigns to promote some of its product lines that are intended for young adults precisely because they are already so comfortable using those forms of communications. Perhaps the most innovative concept embraced by Ford in that regard is the incorporation of customer-to-customer communications as a supplement to the traditional channel of promotional communications between corporate entities and prospective customers.

Tata Motors as the Counterexample