Online NewsHour: Ford.com- February 4, 2000



	FORD.com

February 4, 2000

Ray Suarez has the Ford story.

RAY SUAREZ: The old economy has taken another big step into the new economy. Yesterday the Ford Motor Company announced it will provide a personal home computer and Internet access to each of its 370,000 employees worldwide. Here to explain is Ford's President and CEO Jack Nasser. Well, let's talk a little bit about what exactly you're offering. Any employee who want a personal computer can get one?

JAC NASSER: Ray, it is about providing computers. But the essential part of this program is really about developing personal skills and making sure that every one of our employees is connected to the marketplace and that we're at the leading edge of technology throughout the company. At this stage, we have more workstations within the Ford Motor Company than any other company in the world. And, of course, we're very connected with our suppliers and our dealers and the marketplace. And we felt to complete the circle of an integrated Internet strategy, we needed to go that one step further and make sure that our people at all levels in the company are connected with technology, are aware of the capabilities of the Internet and it also of course enhances the communication channels throughout this company around the world.

RAY SUAREZ: You mentioned those workstations in your plants. I'm sure the workers who have to use them were taught how. A more conventional model might be to just offer a wider training program, make sure that those who want to learn can learn but not go that extra mile and start giving out hundreds of thousands of computers. Why did you choose this approach?

JAC NASSER: We wanted to make sure that the computers and the capability that they offer were available to people at any time that they wished to use them. So it isn't only at your workstation. But if you needed to communicate while you were at home, if you wanted the family to participate in that development of your own skill, you could do that. If you wanted to communicate across the global operations of Ford, you had the access basically anywhere, any time that was convenient for the employees. And we felt this is really pushing the automotive industry into the 21st century and we wanted to take the lead.

RAY SUAREZ: What's the up side for ford of such a no-strings policy? Some of those computers are going to go home and stay in the box, some of them are going to be playing computer games with ten and 11-year-olds. Your employee might not be looking at it very much. There's really no way to know what happens once it leaves your place.

JAC NASSER: That's true. But on the other hand, we want to make sure the tools are there. And we will provide the training. We'll make sure the capabilities are well understood. And we feel that if we can mobilize the hearts and minds and the technical capability of 370,000 people around the world, then that has a power that is very difficult to match.

RAY SUAREZ: Some estimates have placed the price tag on this program as high as $170 million, $175 million. I'm sure you're going to want to know whether you're getting your money's worth down the road. What are the kinds of things you'll be watching to see if the program has taken hold among your workers?

JAC NASSER: Ray, interesting enough, I think the program is worth considerably more than the investment numbers that were quoted. But we managed to put together a very innovative and I'd say novel business structure together with our partners. And over the life of the program, which is a three-year program, the cost to the Ford Motor Company is quite nominal. We think the benefits are going to be a better educated workforce, a workforce that is very technology literate. We'll be able to attract better people ongoing, and we'll be able to keep the communication links very well lubricated throughout the company.

RAY SUAREZ: Are there things that are in the works at Ford that you're going to need more computer-able people to be able to pull off, in parts supply, in just-in-time delivery, in making sure that if a consumer wants a red car that he's not going to have to wait a month to get one?

JAC NASSER: When you see some of the recent initiatives that we've announced, partnerships with Oracle, partnerships with Microsoft, they're all aimed at making the supply chain more efficient, and allowing to us connect to consumers in the marketplace much more directly. The good example is the joint venture between Ford and Microsoft called Car Point, which is an Internet capability for purchasing vehicles. And that will come in over several stages this year. And the ultimate objective is that consumers will be able to choose the vehicle of their choice, personal customization of their vehicle through the Internet.

RAY SUAREZ: I can't imagine that your dealer network is very happy about that prospect.

JAC NASSER: Oh, I think the dealers are very happy because all of this extra business will actually go through Ford Motor Company dealers, and they will be able to reduce their capital requirements, reduce their overhead costs and be able to please customers because they will order the vehicles that customers really want, not those vehicles that just happen to be in the lot at that particular point in time.

RAY SUAREZ: And this is a program that you'll be monitoring what, for two or three or five years? How will you be able to check whether it's really working?

JAC NASSER: It's a three-year program. And we think at the end of the three-year period we'll probably go on to something else. And during this three-year period, we'll monitor how satisfied our employees are, whether they think it's useful. We'll look at the business results and we'll see what progress we're making in terms of our Internet strategy. And we'll see whether communication and efficiency has improved over that period also.

RAY SUAREZ: Well, the funny thing about three years in the world of these machines that we're talking about is it's more outdated than any automobile is after three years. The things are moving so quickly in the world of personal computers.

JAC NASSER: That's true. The hardware, I think, tends to have a longer life than much of the software. And we'll have the capability of upgrading as we go along.

RAY SUAREZ: One of the interesting aspects of all of this is that I guess five, certainly ten years ago, this would have been a bank breaker. The powerful kind of computer that you're offering to your employees would have cost almost half the price of a car not too long ago. But memory has gotten a lot cheaper, the microprocessors have gotten a lot cheaper very, very quickly. And now suddenly this looks like an economical play for you.

JAC NASSER: I think several things have happened, Ray. First of all, the computers themselves are obviously a lot cheaper as volume increases. But also the services that are available are a lot broader and a lot more relevant to industry and technology, and their value has improved considerably over that period as well. So you're right when you introduced it as a subject of the last century's economy merging into the next century's economy. And Ford Motor Company wants to take a leading role in that because we view the automotive industry as a leading indicator of the application of usable technology.

RAY SUAREZ: But there's something that's a little counterintuitive about this as far as this is something that's big, expensive. I mean, a car is a big thing. It's not like a diskette that you can slip in your pocket. It is the epitome of the old manufacturing and distribution system in this country. It doesn't easily fall into the slipstream of what we're thinking of as this new economy.

JAC NASSER: Well, I don't agree with that because the automotive industry is an industry that catches all of the technologies that are leading edge. Whether you're talking about exotic material science or polymer technology, environmental research, safety research, crash, power train research, whatever you're talking about in terms of leading technology, whether you're looking at marketing, finance, all of it is involved in the production, design and distribution of the car and truck. And I think what we have in the automotive industry is a magic mix of all of these leading-edge technologies, plus the specialized skills of mass production, manufacturing and engineering. So it's very complex. And I think it mates itself very, very well with the Internet strategies that we're developing.

RAY SUAREZ: Well, today Delta got into the game as well, announcing that its 72,000 employees would be able to get a free PC.. Do you expect to see a lot of this?

JAC NASSER: I think every company has to decide for itself. But I think there's going to be a considerable amount of pressure to continue to upgrade the skills of all employees in all industries, to give our employees the tools that they need to be able to do the best that they possibly can. And I think technology is going to run across industries and the service economy at a very fast rate. So those companies that are thinking ahead, those companies that are connected with the Internet, those are companies that understand the power that the Internet gives the consumer and also the supply chain, then they'll be at the leading edge. And we want to be right there with them.

RAY SUAREZ: Ford Motor Company's chief executive Jac Nasser. Good to talk to you.

JAC NASSER: Thank you.

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