THE BLOG
01/26/2015 10:48 pm ET Updated Mar 28, 2015

We All Can Transform Culture Through Resonant Leadership

"The leaders who work most effectively, it seems to me, never say 'I.' And that's not because they have trained themselves not to say 'I.' They don't think 'I.' They think 'we'; they think 'team.' They understand their job to be to make the team function. They accept responsibility and don't sidestep it, but 'we' gets the credit. This is what creates trust, what enables you to get the task done." --Peter Drucker

It's September 5, 2006. Alan Mulally is appointed president and CEO of Ford Motor Company. This American icon is facing bankruptcy and extinction. The company is projecting a $17 billion annual loss. Every brand -- and every model -- is unprofitable. There is no commitment to be best-in-class.

Not surprisingly, the prevailing business culture at Ford is one of self-protection and survival. It is a culture of "I." The leaders of Ford's many global brands and divisions don't talk to each other. Some executives are engaged in bitter internal rivalries -- all of which have nothing to do with better serving customers. Clearly, the culture is broken, right down to the assembly line level, where employees who stop production for any reason get reprimanded by their managers.

From "I" to "We"

Like many CEOs who are brought in from outside a company, Mulally encountered substantial resistance at Ford. He had no background in the auto industry; he wasn't a car guy. Insiders and pundits alike questioned his ability to make enough of a difference. Yet, Mulally made a tremendous difference. Under his leadership, Ford experienced a profound turnaround and a true cultural transformation.

Mulally was able to build rapport and trust within his team in a very short time. He was able to help his executives transform their relationships with one another -- from fighting against each other to pulling together. And he was able to lead them in working together to create a compelling vision, to conceive and implement the highly successful One Ford plan.

How did Mulally effect such dramatic change so quickly? Let's step inside Ford for a moment to experience one perfect example.

Red, Yellow, Green

Every Thursday morning at 7 AM, Mulally meets with his direct reports. He institutes a "traffic light" color coding system for projects and deliverables: Green means everything is on track. Yellow means some attention is needed. Red means there are critical problems.

At the very first weekly business meeting, most senior leaders arrive with a chart that shows Green, Green and Green. Very few charts are showing Yellow. None are displaying Red.

Mulally stops the meeting. He faces his team and essentially says: I see a whole lot of Green here. Is anything NOT going well? Because right now, we're on track to lose $17 billion.

One brave executive, Mark Fields, decides to take what is, at that point, a huge career risk: He presents a Red alert. It concerns the launch of Ford's next big thing, the Edge SUV in Oakville, Canada, Ford's first true crossover vehicle. The launch has been delayed because of technical issues. A grinding noise is coming from the SUV's suspension.

The room goes deathly silent. The leadership team is shocked by Fields's disclosure.

And then Mulally acts. Rather than reprimanding Fields, Mulally applauds. And then he says, "Mark, I really appreciate that clear visibility."

Then Mulally does something just as radical. He asks: Who can help Mark with this?

With that question, the energy in the room shifts. Mulally has rewarded honesty and transparency, and he has opened up a space for teamwork and collaboration. In moments, leaders are coming up with suggestions. Some pitch in to help. And within two weeks, the Edge delivery is marked Green: on target.

Mulally looks back on this as "a defining moment in Ford's turnaround." And, he says, "Within two weeks, the entire set of charts was all rainbows." People were ready to speak the truth and get some help.

Honoring People

Mulally's emphasis on openness, appreciation and teamwork -- and, in a broader sense, on honoring people -- naturally extended beyond his direct reports. Mulally says he considers it an honor to serve as a leader, and he has shown that by honoring the people he serves.

At Ford, he did so by putting people first, and by ensuring consistency of purpose. Leading by example, he created a safe environment for people to have an honest dialogue, especially when things went wrong.

He also unified Ford's many fiefdoms. The One Ford plan evolved into One Team, One Plan, One Goal, One Ford. And employees around the world felt it: They even created "One Ford" songs.

Looking back, Mulally attributes much of Ford's success to its team of employees, dealers, customers and suppliers. And the company found lots of ways to celebrate these people, including honoring everyday heroes: The company collects stories about Ford vehicle owners, dealers and employees who see something that needs to be done... then do it. These stories are shared widely, including on YouTube.

Achieving Resonance

Mulally's leadership style is high-touch, with deep resonance. He amplifies positive emotions, events and relationships. At Ford, he set an example with his self-awareness ... authenticity ... clarity ... focus ... commitment ... empathy ... and joy.

All of these qualities served to build respect, trust and resiliency within Ford. People felt able to withstand any challenge, to communicate clearly with genuineness, to innovate and to create vehicles that were best-in-class.

Of course, the tremendous shifts at Ford paid off. The company started generating annual profits in 2009 and has done so every year since. Of course, its stock price also has rebounded. Today, Ford has a bright future, and employees, dealers, customers, shareholders and suppliers are flourishing.

This turnaround happened, in large part, because of the shift from an "I" culture -- rife with self-preservation, in-fighting and survival -- to a "We" culture filled with openness, appreciation and honor. The change started at the top, where Mulally created and nurtured a space in which every senior leader on his team could feel safe to open up -- and even play. The profound change at Ford started by creating resonance.

Exceptional leaders are resonant. They are attuned to people's feelings. And they support people in creating, amplifying and catalyzing positive emotions. A truly great work culture cultivates the development of resonant leaders so that people at all levels can flourish and thrive.

To implement such an approach in your business, focus on leading from the heart and being authentic. Get clear about who you are and what your values are.

Then focus, as Mulally did, on building rapport and trust with your direct reports. Listen to understand. Applaud honesty (what Mulally calls "visibility"). Celebrate people's genuineness.

When you lead from this space, you'll feel inspired to ask simple, but incredibly powerful questions, like Mulally's culture-shifting query: Who can help Mark with this? When you ask appreciative questions from a space of genuine, heartfelt concern, people will open up. And the questions can be exquisitely simple, like: How are you today? Do you have everything you need? And how can I help you?

Sue Elliott, Co-Founder and Chief Energy Officer, and Johann Gauthier, Co-Founder and Chief Human Resonance Officer, Workplace Energetics, help business leaders amplify their personal power, energize their people and their business, generate forward momentum and achieve epic results. To connect with Sue on Twitter and via email: @empoweringsue / sue.elliott@workplaceenergetics.com. To connect with Johann on Twitter and via email: @gauthierjohann / johann.gauthier@workplaceenergetics.com.