When Alan Mulally joined Ford as CEO in 2006, the company was floundering – to put it mildly. It was 17 billion in the red. Its stock price had fallen precipitously. It was widely expected that Ford would eventually file for bankruptcy.

Mulally’s impressive turnaround of the company saw him garner a 97% approval rating as a CEO. The company has achieved a 700% increase in its share price since 2009. Ford has seen the best profitability in decades and shed its junk bond status.

His leadership style and results earned him CEO of the Year by Chief Executive Magazine (2011), MarketWatch (2010) and Man of the Year by Automobile Magazine (2010), plus a host of other esteemed accolades and awards.

There are many reasons why Mulally has been lauded as one of the best corporate leaders of our time.

What was the most powerful action he implemented from the get go?

Setting ground rules around the behaviour expected of his key leadership team.

PLUS, he had a zero tolerance policy for any deviation from these ground rules. Like a new teacher walking into a classroom of rebellious teenagers, Mulally had all eyes on him – and a brief window to let everyone know how it was gonna be.

Did he get challenged? You bet! But, he held steadfast to these behavioural ground rules. And the rest, as they say, is history.

In so many organisations, KPI’s of senior leaders focus on the ‘what’. Profit margin, growth, revenue and market share. In other words, outcomes.

And, there’s nothing wrong with that. The question is more about – what is missing?

“We respect what we inspect – not just what we expect.” This quote was made for setting ground rules on behaviour with your team.

Mulally put as much emphasis, dare I say it, more emphasis on the how. He knew that if they got the behaviour right, the rest would take care of itself.

How the team worked together.
Interacted.
Created trust.
Respect.
Safety to be vulnerable.
To share.
To focus.

How can we learn from this inspiring story?

Here are 6 ways you can create (and enforce) ground rules in your teams:

  1. Create a team charter. Do this collectively, but be transparent about the ones that are non-negotiable. Alan and his team had “people first,” “respect, listen, help and appreciate each other,” and “no jokes at anyone else’s expense.” Others may resonate more for you and your organisation.
  1. Look at ways and places you can demonstrate these. Alan used his infamous Thursday meetings as the predominant platform for sticking to the behaviours they agreed to follow. For you and your team, there may be more suitable ways and occasions for living the behaviours you have set. Meetings, operating rhythms, organisational rituals, processes. Look to every opportunity to live and breathe your leadership charter.
  1. He modelled them himself. He held himself to account on these critical behaviours. He gave his team permission to call him on it if and when he fell short. He held his leadership team accountable to the same high standards.
  1. Practice zero tolerance. Like children, if you renege once, it’s almost worse than having the rule itself. Apparently, if someone started to use their mobile phone in a meeting, Mulally would stop the meeting and ask, “Is there anything we should know from that phone call?”

“The important thing is that we are all accountable to each other. You are accountable to the team, and the rest of the team is here to help you.”

  1. Make sure everyone knows. Communicating the ground rules at every level is key. Mulally distributed wallet-sized cards with Ford’s business plan on one side and 16 expected behaviours on the other, but you may have other ideas to spread the word.
  2. Get buy in. Ensuring everyone understands the ground rules and why they are important is vital. Make sure everyone is on the same page. As Mulally said, “It is about people working together for the good of all of us.”

How do you create and enforce ground rules in your teams? I’d love to hear your comments – please share your thoughts in the comments section below.