Tuesday, September 25, 2018Canada's Leading Online Business Magazine

Ford Canada’s President & CEO Believes Her Company Has the Edge on Competitors

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It’s but a 90-minute drive along the Queen Elizabeth Highway from the western New York border along the Niagara River to Oakville, Ont. but Ford Motor Company of Canada President & CEO Dianne Craig has nonetheless come a long way from her childhood years growing up in Hamburg, NY – a small town in Erie County of about 60,000 just outside Buffalo – to where she now leads one of this country’s largest and well-known companies.
 

“My family is still there,” she tells us. “My parents turned 80 in September, so I was the only one that actually left Buffalo. My grandmother was Canadian and lived in Niagara Falls. When I got this job I was just so delighted because I’m only an hour and a half from Oakville to visit with them, so it’s just been great.”

Craig, who celebrated her 50th birthday in February, has been at the helm since November, 2011 leading Ford of Canada’s operations from national headquarters in Oakville, just west of Toronto as well as three regional offices, two branch offices, three vehicle assembly and engine manufacturing plants and two parts distribution centres. In total, Ford Canada employs almost 6,000 workers with about 18,000 more working at dealerships from coast to coast.

One of the first things you notice about Craig even before getting into the finer details of the automotive business is her high energy level and warm, enthusiastic approach.

A friendly, smiling face is certainly the best way to begin. She has been Ford her entire adult working career after graduating from the State University of New York at Fredonia with a degree in mathematics and holds an MBA from Ohio State. If nothing else, that math degree comes in handy when counting Ford’s total sales compared to that of the competition.

After joining the company at the age of 22 in 1986 in what would best be described as an entry level marketing job, Craig’s climb to the top is truly a story of perseverance and proof that hard work pays off.

“In a marketing, sales and service function at Ford, one of the entry level positions is when you call on dealers,” Craig explains. “You start in what we call the Ford College Graduate Program and you learn the business and the best way is hands-on, working with our dealers.”

It is decidedly evident Craig is expeditious in spreading credit to all involved in making Ford a success, including the dealerships and individuals working for the company right across Canada.

“Our dealers, whether in Canada or the U.S., are phenomenal business operators,” Craig continues. “I owe a lot of what I’ve learned in this business to the dealers I’ve called on over the years. Not only were they great teachers, mentors and coaches but they’ve become good friends of mine as well.”

Craig worked in that entry-level marketing role for about five years, being given a bit more responsibility as time moved on before being promoted to a managerial role while working on the distribution of product.

“Throughout my career I’ve had great assignments whether it’s advertising or marketing or product development or field operations.”

Building a Career

Determined to forge a successful career for herself, Craig admits that when coming out of school she really wasn’t certain what route her educational background would take her down, but once she got involved in the automotive business, she was enthralled; something just felt right.

“When I came out of university with my undergraduate degree I didn’t think ‘I want to go work for the car business’ – it’s just something that happened and I feel really fortunate because when we all work in the careers and professions we have, you spend a great deal of time in your career, and you have to love it because it certainly makes for a much better life when you like what you are doing,” she laughs. “I love the car business. It’s been great fun; the people are fantastic. I picked a field that suits me well.”

Married for 18 years, Craig and her husband – who works in advertising – have one daughter who is now 14.  They’ve lived in Canada for a little over two years and feel very comfortable here and enjoy the surroundings.

Craig says keeping a strong balance in her professional life and her personal life is something she also strives to always keep in line, which isn’t easy when you’re heading up a large automaker such as Ford where requirements for your time and crucial decision making can be extremely demanding.

“You just have to find that balance,” Craig replies. “My husband and daughter are proud of me, as is my family. They’ve been huge supporters and I couldn’t do what I do without all their support. We all have demanding jobs and so it just comes down to striking that balance, which is different for everybody.”

Canada-U.S. Marketplace

Craig emphasizes how much the Canadian and American marketplaces are in fact quite different but it’s not something you notice until you spend an appreciable amount of time in one market or the other.

“Having come from the U.S., I expected the market to be pretty similar; we share a border, the same language, same time zones but the segments are different.”

Canadians have a preference for smaller vehicles and the finance terms are longer than those you’ll find in the United States.

“At Ford we’re working really hard to make sure we minimize that trade cycle because our vehicles are changing so much,” Craig notes. “We want to make sure we get our customers into our vehicles and not be committed in these longer term 84-month or 96-month contracts, because we don’t think it’s in the best interests of the customer long term.”

In recent years there has been a growing number of women who have not only reached the executive ranks in many North American companies, but some have ascended to the very top, such as Craig and Mary Barra in the automotive industry, with the latter taking over the reins at General Motors Company.  But there’s still a long way to go. The number of women occupying senior management positions in Canada’s biggest companies has barely budged in the past decade. Only 17% of corporate officers and 13% of directors at Canada’s top 500 private and public sector companies are female. But Craig believes the tide is turning.

“I have met so many women CEOs in Canada so I don’t know if it’s just not talked about enough or they’re just not recognized, because they are out there. In my case, there are a lot of women in senior positions at Ford and I encourage men and women to come to this industry because it’s a great one to work in.”

Differentiating oneself in heading to the top of the executive ladder is never an easy thing to accomplish in this ultra competitive world we live in, but Craig made it. 

“I worked really hard and listened really well,” Craig replies when asked about her ascent to the summit. “I had great mentors and teachers. Every position I had enabled me to grow more professionally and learn the business and I had a really supportive family. You can have a combination of those other things and be lonely at the top without family support.”

A Key Economic Driver

The auto industry is a particularly vital cog to the economy of Ontario, which hosts all vehicle assembly plants in Canada and also the vast majority of the 150,000 jobs in assembly and parts manufacturing that compliment the main auto plants themselves. Auto manufacturing and auto parts components represent about 2.5% of Ontario’s gross domestic product. That figure increases to almost 10% if you factor in other reciprocating industries such as steel production, transportation and warehousing facilities.

Auto manufacturing in North America went through a golden era from the 1960s through the 1980s and even into the early 1990s, but after that the realities of globalization and increased worldwide competition began to take firm hold.  There was a noticeable and substantial drop-off for a variety of other reasons as well. Despite the downturn that has plagued the industry for almost 20 years now, Craig believes that manufacturing, and specifically the auto industry, can remain an economic force within Canada, providing steady, good paying jobs for Canadians. 

“There’s no question there’s reason to be optimistic,” Craig says. “It’s a really exciting time for Ford Canada with the announcement of the next generation Ford Edge, which will be built in Oakville for the world. We’re going to ship to 60 countries around the globe. We made the big investment with Oakville that we announced back in September. Windsor and Essex have double the workforce that we planned to have there just five years ago, so I think we’re securing manufacturing to at least keep the base that we have,”

As with any successful business, or industry for that matter, the need for a common goal and a clear vision is something that must be adhered to by all parties involved.

That alone can be a cumbersome process, but it’s vital that everyone keeps moving in the same direction.

“It’s a collaborative effort between government, making sure we have a competitive labour agreement, which we got done a couple of years ago and making sure you have got a great workforce,” Craig maintains. “We’ve got the right ingredients to make sure we keep manufacturing in Canada, which is so important because it’s vital to the economy.”

Those who champion the efforts of the manufacturing industry, be it automotive or otherwise, often fret about the value of the Canadian dollar versus its American counterpart when the loonie is at – or near – par with the U.S. greenback.  A strong dollar definitely hurts exporting, regardless of whether it’s tender fruit or automobiles.  But from the other side, a dollar that is too weak also hurts many of our other crucial business industries, lowering our economic standing within the international community.

Many manufacturing leaders would ideally like to see the dollar hovering around the 80 cent level, while most financial economists would argue that’s far too low for the other sectors of the economy to sustain and be successful, opining that the sweet spot is more likely in the range of 90 to 92 cents.  Craig isn’t certain you can put an actual number on where it would best suit the automotive industry.

“You’ve got to be really careful about the Canadian dollar driving decisions,” Craig warns. “Yes, we factor it into the equation, but when you’re making a $700 million investment and a plant in Oakville that just celebrated its 50th anniversary, you can’t just whipsaw a manufacturing complex like that based on what might happen with the dollar – and over time it changes. There are times it’s going to be to our advantage and times when it may not be, but it can’t be the key driver and we’ve got to be really careful not to overreact to it.”

On its 60th anniversary of being in Oakville in 2013, a $700 million investment announcement was made last fall, officially coming via Executive Vice President and President of the Americas for Ford Motor Company Joe Hinrichs, who is also Craig’s boss.  The injection of capital helps guarantee a degree of stability in the manufacturing sector for a number of years to come.  It’s an increase of $200 million in spending in Canada each year and takes the total commitment to $4 billion each year.  Adding to that total is a combined $135 million coming from the federal and Ontario governments.  Ford first came north of the border in 1904 with the opening of the Essex plant near Windsor.

Craig credits a “competitive labour agreement” with the autoworker union now called Unifor and the Ontario and federal governments for offering additional funding to make the project a reality.  Ford Canada employs 6,000 people.

“Ford’s investment demonstrates Canada can be competitive in the global market through strategic partnerships,” said Craig. “Working closely with government and labour, we have secured a bright future for our employees at Oakville Assembly.”

In this era of an acutely competitive global economy, it’s essential that manufacturing facilities be set up to serve countries well beyond their own borders. Canada is the ninth-largest vehicle producer in the world and the auto industry remains Canada’s biggest contributor to manufacturing Gross Domestic Product (GDP) and its largest manufacturing employer. According to Statistics Canada, GDP in the motor vehicle manufacturing industry group decreased from $14.0 billion in 2002 to $9.7 billion in 2011.

The decrease in GDP reported between those years represented a compound annual rate of 4.0%. Between 2010 and 2011, the total value-added of the motor vehicle manufacturing industry group increased by 0.7%, a trend that seems to be continuing at the present time. From 2009 to 2012, the volume of sales in automotive industries, expressed in 2002 constant dollars, increased 67.3%, outpacing the 54.4% rise in current dollars over the same period. This difference can be attributed to declining industrial prices in motor vehicle manufacturing.

“Canada can compete and win in today’s global economy,” Craig declares.  “We know from experience that investment in manufacturing pays off. “Looking ahead we’ll continue to focus on products and technologies that customers want through innovation.”

In addition to the newly-redesigned Ford Edge, which is a best described as a crossover between a car and a sport-utility vehicle (SUV), Craig is also excited about what’s in store for the F-150 and this also being the 50th anniversary of the Mustang.

“It’s a big year for Ford of Canada,” she declares. “Not only do we have the next generation Edge being built in Oakville but also the F-150. I mean we already have been the full-size pickup leader for 48 years, big news with the F-150 – certainly we’re going to add military-grade aluminum alloy. It’s never been done on a full-sized pickup; it takes 700lbs of weight out, with betting towing, better fuel economy and better pick up. This is huge innovation. And then we’ve got this gorgeous Mustang, an automotive icon celebrating its 50th birthday. We’re super excited and are looking to capitalize on what is going to be, in our opinion and our forecast, another record industry in 2014.”

Automotive Innovation Fund

The Automotive Innovation Fund was established to provide $250 million over five years to support automotive firms’ strategic, large-scale research and development (R&D) projects to build innovative, greener, more fuel-efficient vehicles.

Under the AIF, Minister of Industry James Moore and Industry Canada will consider funding proposals that provide for private-sector investment of more than $75 million over five years. Eligible projects will include vehicle and powertrain assembly operations associated with significant automotive innovation and R&D initiatives. Other large-scale automotive innovation and R&D initiatives will also be considered, provided they meet the $75 million threshold.

“We were really proud to have the prime minister come to our Oakville plant in January and announce he was going to top up the Automotive Innovation Fund,” Craig states.

“It’s absolutely vital in attracting manufacturing. Even with the Oakville investment I’m up against my global colleagues to fight for that manufacturing investment and when you have jurisdictions, whether it’s the U.S. or Mexico that are willing to pay up to 50% of the investment to secure that manufacturing and those jobs, they’re willing to do that.”

Craig estimates her time is about evenly split 50/50 between working out of head office in Oakville and travelling to various destinations in an effort to drum up more business for Ford Canada.

“What I most enjoy is getting out to see our dealers,” Craig mentions. “We have 443 dealers across Canada. They are a tremendous asset to us being the face of Ford in their community and they are the reason we’ve been the market leader for four years.”

“We have an incredibly talented group of individuals so the company is going to be in great hands when Alan does decide to retire. We’ll all be sad about it because he’s been so inspirational and an incredible leader. He changed our company and I’ve publicly said I’d take a bullet for him because he’s such a tremendous leader.

“We’ve always been known as a pickup company with F-150, while of course everyone knows Mustang, but we’ve been changing perceptions on the car side of the business for the last five years. We had our entry level Fiesta which has done incredibly well. Last year our Fusion sales were up 21% hitting an all-time record, the Focus is the best selling vehicle around the globe and Canadians are finding out why that is. We want to add value for our consumers with the small, medium and large cars, utilities and trucks so that we have the depth and breadth of offerings. It’s not just the products, it’s also powertrains, plug-ins, hybrids, electric vehicles and eco-boost engines that are fantastic from a fuel economy standpoint.”

Technology moves at lightning speed… where will the industry be in five years.

“We anticipate and innovate so very well for the customer,” Craig says. “If you look back even five years ago at what was out there versus what will be out there in the next five years, the market is moving faster than I’ve ever seen it in my 28 years with Ford. We are going to continue to focus on what the customer wants in their vehicle and then deliver that to them.”

We’re still waiting for those flying automobiles as seen on the old Jetsons cartoons.  Given the pace of technological innovation, that day might be coming a lot sooner than most of us think.

By Angus Gillespie

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