Industry Report: How Did Mazda Go from So Cold to So Hot?

Getting the Troops Motivated

Going back, while Ford fed Mazda investment capital and shared components the real change that the automaker initially needed

Ford not only provided Mazda with the much needed capital to continue, but also a complete corporate culture overhaul. (Photo: Rob Rothwell, Canadian Auto Press)

was a complete cultural overhaul. Ford did so by dropping a bomb on what had become a secure, comfortable employer, by cutting 2,200 workers in November 1999. While this did its part to stun Mazda's workforce, the adoption of a performance-based employee evaluation system, rewarding high performers with healthy raises and potentially lining up low-productivity workers for the chopping block made all the difference.

"When I walked in two years ago I was stunned at the rooms with the rows of desks," said Philip Martens, Mazda's head of

The 4-door, 4-seat RX-8 sports car truly stretched the limits of the imagination when it debuted last year, and sales have been extremely strong in a segment that is otherwise very soft. (Photo: Trevor Hofmann, Canadian Auto Press)

product development to Forbes in 2000. "It's a very good way of developing competencies but it's not the most fertile way to encourage creative outputs and really break people free. We are breaking the boundaries on the formal organizational charts."

Looking to the Future

So, what boundaries will Mazda break through in coming years? Its 4-door, 4-seat RX-8 sports car truly stretched the limits of the imagination when it debuted last year, and sales have been extremely strong in a segment that is otherwise very soft. Another boundary breaker could be the upcoming Mazda5, a 6-occupant mini-minivan based on compact Mazda3 architecture.