Ford

Chimney Breaking

Previously, Ford was vertically organized by function. The vertical organizations had become so narrow and self-contained that they were referred to as ‘chimneys' of power. Each function had its own goals and perspectives, and each tended to view the others as part of any problem rather than as part of its solution.

Chimney breaking is known as breaking the vertical structures into a horizontal one, so that each functional department can work with other departments horizontally and achieve better working relationships between each other.

Executive Workshops

Before adopting the chimney breaking, the managers need to perceive the problems of its current structure through engaging the DPO executives in executive workshops. Each functional discipline was asked to identify the positive and negative impacts of the other functional departments on its ability to fulfil its role. The comments are then passed to the related function to analyse its feedback and give solutions to respond to the identified problems.

Executive workshops have boosted the motivation of employees as they feel like they are part of the company since their voices can be listened by the senior Ford executive and they have a better understanding of how their role is influencing on each other, this paved them the way to cooperate with each other and work towards a common goal.

The Blue Ribbon Committee

The Blue Ribbon Committee has set a good example of chimney breaking. As the responses indicate that Ford needed faster, higher quality communications and more decentralized decision making, Frey established a Blue Ribbon Committee to address these concerns. The Blue Ribbon Committee was created in early 1980, it was responsible in delayering and downsizing the engineering ranks. It took two years to formulate recommendations. (1) a reduction from five to three layers within the engineering hierarchy, and (2) identification of over 200 middle managers whose positions could be eliminated.

Transformation: never complete

Ford has undergone a significant changing process since 1980 and there has been a radical change in the company's thinking regarding the mangers'