FORD MOTOR COMPANY- SUPPLY CHAIN STRATEGY Harvard Case Solution & Analysis

FORD MOTOR COMPANY- SUPPLY CHAIN STRATEGY Case Solution

CASE OVERVIEW

The Ford Motor company was founded by Henry Ford in 1903, and it produced approximately 260 million vehicles since its inception. The company is also considered as the second largest automobile industry in the world with $144 billion revenue. The company expanded its operations in more than 200 countries with 370000 employees. The company has gained significant profit and revenue from its monetary services. Moreover, the company has been sticking to its core business strategy in which it focused on sales and manufacturing of automobile sales which help edit in achieving its competitive advantage over its competitors in the automobile industry.

From the past few decades, the auto industry has grown rapidly and achieved competitive edge over its competitors companies. However, in 1970s, the three big US companies which involved Ford, (GM) General Motors and Chrysler have analyzed that they are going to lose their automobile market share in the international market due to the expansion of international companies which involved Toyota and Honda. The company has owned and serve variety of brands which include: Land Rover, Mercury, Aston Martin, Volvo and Lincoln. The company’s success is based on its core business strategy which focuses on providing its customers with high-quality innovative products that satisfy their needs and requirements as well as strengthen their business and providing benefits to its communities. The company is dedicated to attaining productivity and progress by implementing their sustainability approach, backup the communities and expand its investment in creative technologies. In order to achieve maximum growth in the auto manufacturing industry, the company decided that it will start its operations with Penske whose lead logistic providers are fully trained in six sigma initiatives who work closely with Ford to restructure its operations and sustain an integrated logistic system.  They both revealed the diverse areas for actual cost saving as a result of this the company has reduce the cost of discrepancy, reducing shipment coverage and eliminated the unnecessary premium cost. On the other hand, in order to gain sustainability in its logistic operations, the company implemented the advanced management and accountability operations which help the company in maintain its supply chain networks as well as provide them a space to gain competitive advantage over its competitors. In 1999, Ford acquired Sweden’s Volvo which help the company in taken advantage of its global presence. In 2000, the company decided that it will restructure its operation which would help the company in achieving its target goals in a single global organization. On the other hand, the company realized that by merging its organization with different companies like North America and Europe, it would help the company in reducing its operational costs as well as allow the company to attain maximum opportunities from these operations. The company also believed that if the company re-engineered its processes and globalizing its corporate operations, then it would help the company in reducing its organizational and process redundancies dramatically as well as help them in achieving economic of scale in the purchasing and manufacturing. Therefore, In order to improve its global performance in the global market, the company decided that it would encourage and develop its export oriented auto industry which would help the company in achieving its targeted goals in the global market. The company looked to Dell for inspiration. It is also expected that in order to attract the suppliers, the company decided that it would use emerging information technology and ideas for change which would help in attracting the targeted audience and suppliers which in turn would help it in increasing its profitability in the auto manufacturing industry..............

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