A Pioneer of the Open Office Helps Ford Rethink the Car

By Christina Rogers 

Ford Motor Co. is looking to reimagine the way people get from point A to point B. It has turned to an unusual pick to lead the charge: Jim Hackett, former chief executive at office-furniture maker Steelcase Inc.

Mr. Hackett chairs Ford Smart Mobility LLC, a subsidiary formed in March to explore new ventures in ride hailing, car sharing and self-driving vehicles. One of several auto-industry outsiders recruited by Ford CEO Mark Fields, Mr. Hackett is expected to help rethink the ways Ford's cars connect with the outside world as well as the company's role in the future of transportation. Also on his list: figuring out how to make money at it, too.

Ford moves into transportation-related services at a time of changing attitudes toward car ownership and emerging Silicon Valley rivals like Uber Technologies Inc. and Alphabet Inc.'s Google.

Over 30 years at Steelcase, Mr. Hackett, age 61, reshaped the company's workplace offerings, dispensing with cubicles and embracing open offices. Later, as interim athletic director for the University of Michigan, Mr. Hackett famously recruited NFL coach Jim Harbaugh to lead Michigan's football program.

Mr. Hackett recently spoke about his new job, and why Ford is looking beyond the car.

Edited excerpts:

WSJ: You were sitting on Ford's board when they recruited you for this role. What was the mission?

Mr. Hackett: Mark [Fields, Ford's CEO] said 'your remit is to come in and help us understand what kind of business models are going to be required in this new space of mobility.' It was a broad mandate.

I asked them if we could construct [the role] in a way that there was a CEO running things -- I wasn't looking to be a CEO again -- and an executive chairman. By making me executive chairman, they allowed me to put as much or more time into the thought part of things as in the running part, and that was appealing to me.

WSJ: Ford anticipates its mobility ventures will eventually return profit margins of 20% or more -- far higher than in the auto business. Why is that?

Mr. Hackett: What reduces margins in our industry and puts pressure on our P/E are the extreme amounts of capital required to produce each dollar of profit. In this case, it doesn't take that. It takes operating expense. You need software engineers and you need designers. But it's not nearly as expensive as the capital it takes to produce a car.

WSJ: What did Ford see in the acquisition of Chariot, the van-shuttle service?

Mr. Hackett: You couldn't help but be smitten by the entrepreneur who started it. [Ali Vahabzadeh] He did some things that were quite impressive, using crowdsourcing as a mechanism for determining where the vehicle goes, so it didn't have a fixed route. The algorithm sorts the requests it gets and plans the routes. It gives you the walking distance to pick it up and people love that. There is a lot of data potential in this business.

WSJ: How will the rise of car-sharing and ride-sharing services change the notion of car ownership?

Mr. Hackett: [Ownership] will be more tied to jobs to be done that day: Are you commuting? Are you on vacation? Are you in a rush somewhere? Are you worried about drinking and driving? All those things will determine what mode of transportation you take.

WSJ: You've also partnered with a bike-sharing firm. What's the connection to selling cars?

Mr. Hackett: They fit into an emerging transportation system where people own vehicles but also share assets. So Chariot and Motivate bike-share are the sharing plays we've made. More important, it is about the data, which for us is really important to the mystery of what the transportation system is exhaling every day.

WSJ: What are the top three items on your to-do-list for 2017?

Mr. Hackett: No. 1 is to build the where-to-play, how-to-win strategy around the world. Two, building out the rest of the team to pull this off. Three, I've been given a license for creative ideas and I need some early wins. This [van-shuttle service] is in place and expanding. It's already gone to a second city. It's on its way to four other cities in the first 16 months.

WSJ: Michigan football fans worship you for hiring Jim Harbaugh. If you could do something equally noteworthy for Ford, what might that be?

Mr. Hackett: I couldn't be happier with the success they're enjoying. If I could leave an impact [at Ford], it's that this brand and its people come out of the mobility challenge more competitive. The next thing that hits [our industry] may not be a financial crisis but a crisis of purpose.

Write to Christina Rogers at [e-mail]

(END) Dow Jones Newswires

November 29, 2016 12:53 ET (17:53 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.