Alan Mullaly, CEO Ford, gave an interview for the Financial Times, Alan Mullaly: in the Driving Seat at Ford, where he spoke about the breakthrough the management team had leading to breakaway company performance. In short, he adopted a “problems-first” environment. Mark Fields, head of the Americas business unit, announced at a weekly executives meeting that there was a problem in launching the Ford Edge.

“I could feel the chairs moving away from me,” Fields recently recalled. “At Ford, in the past, if you delivered bad news, it wasn’t good for your mojo.”

The “old Ford” would create thick reports that would hide the problems a business unit was having. The new Ford puts their problems on the table for others to provide help.

Neither Ford nor Mullaly invented the problems-first approach. Credit has to go to Toyota. As Ralph Keller, President of the Association of Manufacturing Excellence says, “Don’t Allow Problems to Be Hidden; They’re Jewels.” Jewels? Really? You bet! Problems — variances to our expectations — are the opportunity to learn and start a cycle of improvement.

The challenge is not problem-solving. Toyota claims that over 80% of all their improvements start and finish with a Good 5-Why™. When people recognize and investigate variances they inevitably improve the situation.

The challenge is in announcing problems. In the design and construction industry, we deal with problems as we encounter them fixing and “making do” without fan-fare. Most problems are never reported. For all kinds of reasons, reporting problems is seen as job-limiting.

What can leaders do? We must set good examples to celebrate problem discovery, problem announcement and problem learning. Getting involved with learning from variances is one of the most important things a leader can do. It shows a respect for people and leads directly to continuous improvement.

What problems will you announce today?