In the 1980s, four out of five American car buyers were loyal to the company that manufactured their brand. I remember growing up in a Chevy family and we had friends who were Ford people and we were as loyal to our car brand as we were to our religion.

In 2009, only one in five Americans was loyal to the same car brand.

In “The Manufacturer’s World Has Changed Forever” (IndustryWeek, July 14, 2010), Robert Bloom provides this contrast in customer loyalty to point out that the purchasing behavior of customers has changed, which is old news to any company that’s managed to keep its head above water the last two years, but his case study is interesting. Italy’s Fiat Auto reported a net loss of nearly two billion euros in 2002 and experts thought it would not survive. In 2008, it reported a trading profit of more than 1.1 billion euros—a three billion euro turnaround in six years.

How did Fiat Auto do it? Bloom lists several key actions:

• Terminated a failing venture with General Motors to gain full decision-making autonomy
• Eliminated an entire floor of executives to reduce costs and bureaucracy
• Cut Fiat’s product development time in half to get products to market quickly
• Reorganized and re-energized its dealer organization to assure sell-through
• Redesigned every Fiat product to create Customer Preference for the Fiat brand and products

According to Bloom, manufacturers can take several steps to compete in today’s global marketplace—and those steps coincide with Baldrige core values (in parentheses):

• Think like today’s buyer, not like yesterday’s seller (customer-driven excellence)
• Get rid of the dead wood—it will drag you to the bottom (focus on results and creating value)
• Anticipate change—it is inevitable and relentless (managing for innovation)
• Act with determination (focus on the future)
• Move with a sense of urgency (agility)
• Inspire your organization to meet your expectations and goals (valuing workforce members)
• Align your organization to consistently create Customer Preference (systems perspective)

Bloom’s list is incomplete. From a Baldrige perspective, world-class manufacturers also value visionary leadership, organizational and personal learning, management by fact, and societal responsibility. By designing, deploying, and refining all of its key processes, manufacturers can embed these core values into their companies and become, or remain, industry leaders.

To read more about Baldrige and business, click on these articles:

• Small Wonder
• The Real Heroes
• The Top Innovative Companies
• How Can You Stay on Top?
• Engaging Customers in a Digital Age
• Developing Critical Capabilities

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