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Jiangxi, PR China
International Masters in International Business (IMIB)School of International Trade & Economics (SITE)
Presentation on:
Course Title: International Enterprise Management
Strategic Management & Competitiveness of
Ford Motor Company
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Presented by:
1. BAY, Abdul Gafur (Mozambique) 31540047
2. RAHMAN, Mohammad Tawhidur (Bangladesh) 31540051
Presented to:
Ms. LI Yuhua
Date: 18 March, 2016
Ford History: at a glanceThe Ford Motor Company is an American multinational automaker headquartered in Dearborn, Michigan. It was founded by Henry Ford in 1903.
Type Public company
Headquarter Dearborn, Michigan, U.S.
Area served Worldwide
ProductsAutomobilesLuxury VehiclesCommercial VehiclesAutomotive parts
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Logo Evolution
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Old Model Vehicles
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Organizational Structure7
Very Complex structure fairly mechanistic in nature Rigid departmentalization Low span of control High Centralization
ChairmanPresident & CEO
Executive V.P and
CFO
Executive V.P and
CTO
Executive V.P. of
America
Executive V.P. of Europe
Group Vice Presidents
and President of Asia Pacific
William Clay Ford, Jr., great grandson of Henry Ford, serves as the Executive Chairman at the board of Ford Motor Company.
Key Persons88
Mark Fields, serves as the President and Chief Executive Officer of Ford Motor Company.
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Vision, Mission
People working together as a lean, global enterprise to make people’s lives
better through automotive and
mobility leadership.
MISSIONMISSIONVISIONVISION
Values
People
Products
Profit
Organizational Culture
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Objectives 11
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The Ford World Headquarters in Dearborn, Michigan, also known as the Glass House
Ford's Dunton Technical Centre in Laindon, United Kingdom, the largest automotive research and development facility in the UK
The Ford Research Center in Aachen, Germany
Ford Motor Co.’s investments in China include a plant in Nanjing.
Global Operations12
SWOT AnalysisStrengths Weaknesses1. US market position2. Financial performance3. ECOnetic approach4. ONE Ford approach5. Growth in China
1. High cost structure2. Unprofitable Europe operation3. Low exposure to Asia Pacific
Opportunities Threats1. Green vehicles2. Increasing fuel prices (hybrid
cars)3. New emission standards4. Strategic partnership
1. Decreasing fuel prices (regular vehicles)
2. Rising raw material prices3. Instances competitions4. Fluctuating exchange rates
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US Market Share
Internal Analysis15
Internal Analysis: Strengths Producing hybrid vehicles Brand recognition Profitable financial services division
(Ford Motor Credit) Manufacturing facilities in more than
30 countries Wide range of products targeting all
customer classes
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Internal Analysis: Weaknesses
Weakening North American automotive operations
Sales in trucks decreasing rapidly Firing of employees
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New Model Vehicles
2016 Ford Escort Redesign 2016 FLEX
2016 F-150 2016 LINCOLN MKC
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External Analysis: Opportunities
Global expansion. Brand building
o Better quality vehicleso Better safety ratingo Convenience features
Consumers demand hybrid and fuel efficient vehicles. Increase in consumer spending trends. Consumers demand more innovative vehicles. Industry experiences slow and steady growth. Exploring new alternative fuels.
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External Analysis: Threats
Low-cost manufacturersoChinese Auto Makers (Greely, SAIC)
Increase public transportationoBusoRailway (Metro)
Weak USD Increase in steel and resin prices. Increase gasoline prices. Stricter CO2 emission standards. Increasing mortgage rates. Loss of market share.
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External Analysis: Porter’s 5 Forces Model
Threat of Substitutes
Threat of New Entrants
Bargaining Power of Buyers
Bargaining Power of Suppliers
High:• Chinese Auto Industry
High:• To many models and
options
High:•Alternative Fuels•Modes of Transportation•Customer Loyalty
Low:• Option for Outsourcing
to low-cost destinations• Forward Integration
Industry Rivalry
High:• Numerous competitors • Low switching costs
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Environmental Analysis• Reduce CO2 Emissions• Clean diesel fuel technology
– BLUETEC – reduce nitrogen oxide levels• Reuse of car components
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Toyota, Honda, and Nissan have grown in market share largely as a result of their ability to deliver better products at lower prices, particularly for more fuel efficient smaller vehicles.
Toyota has High Quality, High Safety Ratings (NHTSA)-5
star ratings Streamlined operations with similar models
globally Hybrid models across all segments
Ford has been more successful than both GM and Chrysler in reducing legacy costs.
Competitive Analysis
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General Motors (GM): Focusing on emerging markets Researching Alternative Fuels:
Chevy Equinox Fuel Cell Plans to develop 12 hybrid models
Implementing the new “Tru-Flex system”
Competitive Analysis (cont.)
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Competitive Advantage Cost Advantages:
low production cost cut down of huge expenditure on raw materials the online manufacturing process
Differentiate Advantages: production of smart cars with fuel efficiency centralized decision making system. increased market share. Ford SYNC - fully integrated communication and
entertainment system
Value Chain Analysis
General Administration –It should use high level of information system to make strategic and routine decisions.
HR Management – Strong management with continuous evaluation process.Healthy relation with labor union.
Technology and Systems – use the high-tech information technology to integrate suppliers.
Procurement – Minimize dependence on a single supplier. Leveraged strong buyer power into timely, low-cost, and high quality of raw materials. Strong long lasting relationships with suppliers and efficient inventory management.
Inbound Logistics•Efficient inbound warehousing system•Quality inspection at supplier level
OperationsHigh level of automation.
Outbound Logistics•Reduce delivery time•Increase efficiency of finished product warehousing
Marketing and Sales•Develop Quality•Increase brand loyalty•Increase demand creation
ServiceHigh level of service to after sales customers
Marg
in
Margin
Primary Activities
Supp
ort A
ctiv
itie s
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Strategy Implementation ‘ONE Ford’ strategy Friendly competition ‘Less is More’ new approach Reduction of complexity Creating a new corporate culture A shift toward smaller and more fuel-
efficient cars Globalizing the Ford brand
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‘One Ford’ Approach One team
People working together as a lean, global enterprise for automotive leadership
Measured by customer, employee, dealer, investor, supplier, council and community satisfaction
One goal An exciting viable Ford delivering profitable growth
One plan Aggressively restructure to operate profitably at the
current demand and changing model mix Accelerate development of new products customers want
and value Finance plan and improve balance sheet Work together effectively as one team
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‘Less is More’ New Approach
The ‘Bigger is Better’ worldview defined ford for decades
Replaced with a new approach: ‘Less is More’ Cut costs Transform the way it did business than
to measure market share
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New Corporate Culture Structural and procedural changes
Executives meet with CEO every week ‘We are actually committed to hitting the
numbers.’ Team working
Senior executive reorganization Report directly to CEO
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Cost Advantage (A shift toward smaller and more fuel-efficient cars)
Oil prices persistently increasing over the last few years A dramatic change in consumer’s car buying habits,
reducing the demand for large vehicles Leased cars are sold for much less than their residual
values A change in products, shifting to smaller and more fuel-
efficient cars
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Globalizing the Ford brand Globalize the Ford brand
All Ford vehicles competing in global segments would be the same in North America, Europe, and Asia within the next five years
Deliver more vehicles worldwide from fewer platforms and maximize the use of common parts and systems Reduction of costs in the purchasing and
manufacturing processes
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Market Segmentation
Market Segment Sub segment
FORD Motor
Sports Cars
Economic vehicles
Trucks
Buses
Cars
Racing cars
Rally cars
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Market Segmentation (cont.)Market segmentation approaches-
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Geographic Segmentation
-Ford aims to grab the market of UK as well as India, China,
Malaysia
Physiographic Segmentation
-FORD FIESTA comes at reasonable price
Demographic Segmentation
-FORD FOCUS aims for young people,
ladies and average income consumer
Behavioral Segmentation
-With the benefit for safety and fuel
efficiency
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Products, Sales and Revenue
Sells broad range of automobiles under different brand names.
Strong growth in sales all over the world. Ford's total revenue amounted to around 150 million
U.S. dollars in the fiscal year of 2015.
Profit Margin Profit margin represents the percentage of
revenue that a company keeps as profit after accounting for fixed and variable costs.
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Pre-Tax Profit 2008
5.98 Billion 2009
6.23 Billion 2010
6.12 Billion 2011
6.21 Billion 2012
6.56 Billion 2013
7.20 Billion
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Jari-Matti Latvala driving the Ford Focus RS WRC 09 in
2010.
Ford Mustang GT (racing GT car)
Ford Performance Racing Ford Falcon V8 Supercar at Eastern
Creek in Australia in 2008.38
Ford Racing Cars38
Current Strategies Ford has a strategy on new key design Ford is beginning to use Solar energy to power
their manufacturing plants Global Electrification strategy Ford has a very strong marketing strategy as
they market all of their vehicles differently Ford is making more hybrid vehicles through the
increase use of renewable and recyclable materials
Ford is developing natural-fiber composites as a potential substitute for the glass fibers traditionally used in plastic car parts to make them stronger while reducing vehicle weight
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Future Strategies Reduce manufacturing expenses by 15-20% Introduce new small fuel efficient vehicles Develop affordable electric car for US market Increase market share Manufacturing of new small fuel-efficient
vehicle Entering the Latin American and Asian market
with hybrids $ 20 billion Implementation of electric car in the US market
$ 13 billon
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Future Product41
2017 ESCAPE 2017 RAPTOR
2017 LINCOLN
ConclusionIn spite of having strong competition in market, Ford is still dominating the motor industry as well as their business strategies are quite strong for sustaining in this market.
Ford Motor is well positioned in worldwide market offering consumers a variety of vehicles incorporated with new levels of quality, safety, affordability, performance and luxury that meet all the needs, all while retaining Ford legacy for great value.
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Thank youThank you!!
References www.ford.com https://en.wikipedia.org/wiki/Ford_Motor_Company https://en.wikipedia.org/wiki/ECOnetic https://ycharts.com/companies/F/profit_margin http://www.slideshare.net/luchunjin/introduction-of-ford-
case http://www.thetruthaboutcars.com/2014/09/u-s-auto-
market-share-august-2014/ http://www.statista.com/statistics/267305/total-revenue-
of-ford/
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