The turning point: 'Is anything not going well?'.

• Author: Novak, David
• Position: Reprint

Recognizing the behaviors you want and those you don't is essential to keeping your people on track toward achieving your Big Goal. It's important to do this formally, with things like performance reviews and raises, but even informal recognition can have a big impact. I heard a great example of this while talking with the CEO of Ford Motor Co., Alan Mulally, who has presided over what many consider a miraculous turnaround.

Mulally described to me what he believed to be the turning point. Soon after he took the job, he started bringing all the functional leaders and line managers from around the world together to review the status of all current projects, more than 300 of them in all. Protocol was to display the status of each project on a color-coded chart: red stood for serious problems, yellow meant progress was slow, and green meant everything was on track. But something curious was happening. For the first six weeks he was there, every single chart was green. Mulally told me, "I said to the team, I'm getting ready to announce a $17 billion loss and all our projects are green. Is anything not going well?"

Two weeks later Mark Fields, leader of their Americas group, showed up with a chart that was bright red, the only one in the room. Something had gone wrong with the Edge car in Canada, a mechanical problem that had caused him to delay the scheduled release for a week or two so they could fix it.

Mulally described the room as "deathly quiet" after that, and everyone turned toward him for a response. He told...