The Happiest Man in Detroit

Quarter after quarter for almost two years, the news out of Ford Motor (F) was astonishingly good. Under Chief Executive Officer Alan Mulally, who'd joined the company from Boeing (BA) in 2006, Ford had not simply avoided bankruptcy and a federal bailout, it had turned itself into the world's most profitable automaker. It beat analyst estimates for seven consecutive quarters and drove its stock to a nine-year high of $18.79 on Jan. 27, up from $1.26 on Nov. 19, 2008. Last year, hits such as the Fusion family car and Fiesta subcompact propelled sales of Ford models upward at twice the rate of the overall market. And the 65-year-old Mulally, a gifted and relentlessly upbeat salesman, wasted no opportunity to look into the eyes of analysts and reporters, squeeze their forearms, and remind them how "fabulous" Ford had become.

Late last year, however, Mulally began to see some new signs of trouble. Inside the Thunderbird Room on the 11th floor of Ford's Dearborn (Mich.) headquarters, the windowless conference chamber where Mulally meets around a circular table with his 15 top executives every Thursday at 7 a.m., some of the news suddenly wasn't good. At these 2 1/2-hour meetings, known as BPR for business plan review, he requires his direct reports to post more than 300 charts, each of them color-coded red, yellow, or green to indicate problems, caution, or progress.