Ford Management Bonuses Now Directly Tied To Quality

After facing numerous well-publicized quality issues in recent years – some of which stem from inefficiencies that went away and resurfaced – Ford has since begun the long process of rectifying that big problem, a solid portion of which originated during the pandemic. The automaker recently set varying best-in-class quality targets for its most popular models, though CEO Jim Farley also noted that while he expects this process to take years, initial quality has already improved as of late. When speaking during the automaker’s Q4 2023 earnings call with investors, Farley also revealed that Ford management bonuses are also now directly tied to quality, too.

“Yeah, I mean I’ll give you example. Three years ago, to be very precise, three years ago, when we – it was the first year we had kind of record recalls in the U.S. I had just become a CEO and I looked at the performance management of the middle and entry managers – supply chain, manufacturing, and engineering. And 91 percent of them had 100 percent or more in their cash bonus. Okay?” Farley said.

“So, now, that’s not the case. You have to set up a culture shift, performance reward system, where every engineering manager, purchasing component manager, every plant manager is fully accountable for the quality and cost of their work. I could give you 20 examples like that. Things that have changed now and we’re starting to see the results.”

This change makes perfect sense, and is perhaps overdue after Farley recently admitted that he waited too long to address the company’s burgeoning quality woes. Regardless, FoMoCo has since begun using one of its rivals – Toyota – as a benchmark for quality, all while implementing new production process that are quite costly, yet are already resulting in fewer issues during new model launches.

We’ll have more on Ford’s quality push soon, so be sure and subscribe to Ford Authority for continuous Ford news coverage.