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Laymon made one more stab at Carlos Ghosn. Bill Ford even flew to Paris to meet with him personally, but Ghosn again insisted on having the chairman’s title, too. He had clashed with the Michelin family when he worked for the French tire company and would only agree to come to Dearborn if the Ford family had no part in running the company.

As Ford and Laymon flew back from France, the company’s directors were going through their address books to see if they could find someone outside the automobile industry who was equal to the challenge. It would have to be somebody who had already proved he could do it—somebody who had not only run a global manufacturing enterprise, but also turned one around. The list they came up with was a short one. The name on the top was Alan Mulally.

The Man on the White Horse

A
s the head of the Boeing Company’s Commercial Airplanes Group, Alan Mulally had spent the past ten years fending off one disaster after another while somehow managing to transform its divisive culture into a model of corporate collaboration. Under his leadership, Boeing had survived an unrelenting assault by Europe’s Airbus Industrie, a difficult merger with rival McDonnell Douglas, and the collapse of sales that followed the terrorist attacks on New York and Washington, D.C., in 2001. Mulally turned what could have been a fatal blow to the aerospace giant into an opportunity to fundamentally transform the company into a leaner, more profitable enterprise. By 2006, Boeing’s commercial jet division was well on its way to record sales, revenue, and earnings. Mulally credited it to a team-based approach he called “Working Together.” And he had learned many of its principles from Ford Motor Company.

Mulally’s success at Boeing was already making him something of a corporate celebrity, but he hardly acted the part. He looked like an older version of Richie Cunningham, the wholesome protagonist on the television sitcom
Happy Days
. Mulally had the same reddish-blond hair, the same pointed chin, and the same gee-whiz grin—only Mulally’s suggested he knew more than he was letting on. It was the only hint that there was more to him than his aw-shucks, backslapping demeanor suggested. It was as though he had an ace up his sleeve that he was only barely managing to conceal. Otherwise he
came off like an overgrown Boy Scout, seasoning his conversations with words like
neat, cool
, and
abso
-LUTE-
ly
. While most high-level executives favored tailored suits and expensive cuff links, Mulally’s trademark couture at Boeing was a red Windbreaker. His idea of dressing up was a blue blazer and tie. Instead of an expensive Montblanc pen, he used cheap retractable ballpoints he could buy by the box. He drew a smiling jumbo jet under his name whenever he signed anything.

The
Seattle Times
called him “
Mr. Nice Guy.” Mulally’s lack of pretension was evident in his dealings with other people. At formal events, he showed little interest in the rich and powerful, preferring to mingle with those less interested in comparing résumés or other measurables. He asked more questions than he answered and seemed genuinely interested in what people had to say, be they world leaders or waitresses. Mulally made a point of remembering something about everyone he met and would often astonish underlings by recalling some scrap of information about their lives they had shared with him months or years before. He was also big on hugs, and had even been known to plant pecks on the cheeks of both men and women when he was in a particularly exuberant mood. All of this made Mulally adored by subordinates. It also kept his rivals off balance. They could never quite figure out how much of it was an act. And Mulally liked to keep it that way.

The truth was that Mulally’s character was an odd mix of guilelessness and relentless determination that was born of an austere childhood and a lifelong desire to write his name across the sky. Mulally’s interest in aviation was not the product of the usual schoolboy fascination with flight, but an attempt to lash himself to something really big and important that would take off like a rocket and leave his humble beginnings in Lawrence, Kansas, lost in a plume of prairie dust.

Mulally’s parents met at a USO dance there in 1943. A month later they were married and his father was on his way to the Pacific. Mrs. Mulally followed him to his base in Oakland, California, when she found out she was pregnant. Alan was born there—the first of four children, and the couple’s only boy—but returned to Kansas with his mother a few days later. His father joined them there after the
war, taking a job as a postal worker. The Mulallys were not poor, but they were far from well-off.
Alan grew up in a series of small ranch homes, a somewhat nerdy kid with a crew-cut and off-brand jeans who dreamed of bigger things. He used to sit in one of the front pews at the Plymouth Congregational Church so that he could study the pastor and learn the secret of his sway over the congregation. As a child, Mulally delivered the local newspaper and
TV Guide
. As soon as he could afford it, he made a down payment on his first bicycle at Montgomery Ward so that he could take on longer routes. It cost $57 and Mulally rode back to the store every week to make a $1.25 payment. In high school he upgraded to a motorcycle and started a lawn-mowing business, building a trailer for his bike so that he could tow his equipment. Instead of football, he went out for gymnastics. It did little to improve his social standing on campus, though he finished second in the state. But Mulally continued to search for something bigger and more important.

He finally found what he was looking for on his family’s black-and-white television in September 1962 when he watched President John F. Kennedy call on his generation to go to the moon. Mulally took it as a personal challenge—one worthy of his lofty ambitions. He enrolled at the nearby University of Kansas, joined the Air Force ROTC, and started studying physics and calculus as he plotted his path to the stars. But a routine physical revealed that Mulally was color-blind and put an end to his dream of becoming an astronaut. Mulally shrugged it off and switched his major to aeronautical and astronautical engineering. If he could not go to the moon, he could still build the rockets that would take other men there. At the same time, Mulally was beginning to demonstrate the charisma and leadership skills that would serve him so well later in life. He joined the
Kappa Sigma fraternity and became president of the Lawrence chapter. At night he managed a small convenience store, Dylan’s Quick Shop. The owner told Mulally he would never amount to anything, but his professors were more encouraging. His graduate adviser, Jan Roskam, thought Mulally was a born leader with a knack for getting people to work together. At the
school’s annual engineering exposition, Mulally not only did much of the organizing, but also made sure everyone had
fun at the event. Roskam told Mulally that he had a rare gift for an engineer—people skills—and suggested that he think about management. The professor, who consulted for Boeing, also talked Mulally into going to work for the aerospace company instead of NASA.

Mulally toyed with the idea of becoming a professional tennis player first. He was that good. But after earning his master’s in 1969, Mulally headed for Seattle. Airliners were not nearly as sexy as rockets, but he soon found himself enamored with the idea of jet travel and its ability to make the world a smaller place. Just as Roskam predicted, Mulally was quickly promoted to management. But his first employee quit after Mulally kept redoing all of his work and showing him his mistakes. The young boss realized that his job was not to show his subordinates how much smarter he was than they were, but to bring them up to his level. It was a valuable lesson, and one he never forgot. As he honed his management skills, Mulally kept asking for more responsibility and getting it. He worked on every Boeing jetliner program from the 707 to 767. By the early 1980s, Mulally was being eyed for a senior position. Boeing sponsored him for a Sloan Fellowship at MIT, where he earned a second master’s in management and only missed Bill Ford by a couple of years. Mulally’s career advanced quickly after that. He led the cockpit design team for the 757 and 767 programs, creating the first all-digital flight deck for a commercial aircraft. But it was on the pioneering 777 program that Mulally really made a name for himself.

Ford CEO Donald Petersen was a member of Boeing’s board of directors in the late 1980s when Mulally was named chief engineer for the important new jet program. Petersen suggested that Mulally study Ford’s work on the Taurus and offered to introduce him to Lew Veraldi, the man who led the development group Ford called “Team Taurus.” Veraldi was a visionary product development executive who, when given the task of designing a car that could take on the Japanese, had assembled a team that included almost every Ford function to make sure they got it right. In addition to the usual designers and engineers, there were representatives from manufacturing on hand to offer insights from the assembly line, purchasing staff to add input from suppliers, and marketing people who talked to dealers and
found out what their customers really wanted. Veraldi even worked with major insurance companies to figure out how to make the car cheaper for customers to repair after a collision. As a result of this innovative approach, the Taurus not only became the bestselling car in America, but also came in nearly
$500 million under budget—unheard-of at a company famous for its cost overruns.

Ford promptly forgot most of what it learned from Veraldi and Team Taurus, but Mulally did not. He blended it with other lessons he picked up on Toyota’s assembly lines during visits to Japan and applied it all to the Boeing 777 program after he was promoted to general manager in 1992.

By then the new jet had become a make-or-break gamble for the aerospace giant. All over the world, airlines were passing on Boeing’s aging 747 and buying newer models from its rival, Airbus. The company was losing market share and desperately needed a new plane, but the entire industry was in the midst of a deep recession. One of the most complicated machines ever built, the 777 would push the envelope on aeronautical science and would cost
an estimated $5 billion. It was a huge risk but Boeing had no choice. The company staked its future on the program and asked Mulally to lead it.

He assumed command of a team of ten thousand and a supply chain that stretched over four continents. The program was already behind schedule, a victim of the same sort of corporate infighting that had plagued Ford. To cut through it, Mulally and his boss, Philip Condit, instituted a new policy of enforced cooperation and transparency. This was Working Together, and it required the top leaders of each discipline and function to meet every week to go over their progress, discuss problems, and figure out how to deal with them as a team.

“It was a point of conflict to begin with. You know, an engineer with pride wants to find the solution to his problems. And it’s not a natural thing to go out and explore publicly the particular problems you have,” said Ronald Ostrowski, who became chief engineer of the program after Mulally was promoted to general manager. “
There was resistance at first.”

Mulally overcame it by inviting a documentary crew to film the
entire process. He knew the cameras would keep everyone on their best behavior.
^*
It worked.