Introduction
The aim of this assignment would be to describe the assignment along with its primary stakeholders. The company that is taken into consideration for this assignment is Ford; the most prominent name in the automobile industry. To gain insight regarding the company and its processes, the vision and mission statement would be analyzed and described. Moreover, the company’s code of ethics would also be evaluated to gain relevant knowledge regarding the organization and how it seeks to operate in the internal and external environment.
The main theme of the study would be to analyze the most prominent challenge faced by the leadership of the organization. Such an analysis would play significant role in the identification of company’s performance in the automobile sector. Lastly, the study would focus on providing a strategy that could help the company to overcome the challenge. The strategy, in particular, would tend to focus on eliminating the challenge based on outside research.
Overview of Ford
Ford was incorporated in 1919 with an aim to produce cars and trucks to revolutionize the way people move from one place to another. Being the largest producer of automobiles, the company operates in North America, South America, Europe, Asia Pacific and Africa. Ford being the largest manufacturer of cars and trucks has 260,000 employees working in 100 plants worldwide (Ford, a).
Being an internationally recognized and well reputed automobile company in the world, the company acknowledges the importance of innovation and is highly committed to it throughout the vehicle lineup in terms of fuel economy, head-turning style as well as customer focused technology. Innovation being the heart and soul of Ford, the company focuses highly on providing the customers with the best quality cars and trucks in the market which eventually is gained with the company’s ability to mold technology to its optimum level. In the automotive sector, the most acknowledge brands of the company include Ford along with the luxury brand Lincoln. On the other hand, the company discontinued the manufacturing of Mercury brand in the year 2011 (Hoovers, n.d.).
In the year 2011, the company was able to sell approximately 5, 695,000 vehicles in the international automobile industry (Reuters, 2013). Providing the customers with right vehicle at the right time is one of the priorities of the organization. To accomplish such priority, Ford’s cars and trucks are marketed through retailer dealers in North America. In addition, distributors and dealers are the primary source of the organization to meet the demands of the customers outside North America. Moreover, the company is also known for selling of cars and trucks to dealerships for sale. The fleet customer of the company includes commercial fleet customers, daily rental car companies along with the government.
Maintaining the old customers along with attracting new customers is the goal of the organization. To do so, the retail customers are provided with variety of after-sale services which include maintenance and light repairs, heavy repairs, and collision repairs along with other wide range of services (Reuters, 2013).
Being an internationally recognized motor company, Ford faces stiff competition from variety of automobile companies in the market. The top three competitors of Ford include Chrysler Group LLC, General Motors Company and Toyota Motor Corporation (Yahoo Finance, n.d).
Primary Stakeholders
Ford is an internationally recognized and the largest manufacturer of vehicles, it has to deal with variety of distinct categories of stakeholders. The primary stakeholders of Ford are as follows (Ford, 2012):
- Employees
The company currently employs 260,000 employees that are constantly represented by unions. In addition, the workforce outside the North American territory is also represented by unions. With the help of unions, the company is presented with several opportunities to provide the workforce with safe, productive and healthy environment where each individual is respected regardless of factors i.e. place of origin, religion, color, sex etc (Ford, 2012).
- Customers
Ford’s customers play an influential role in the success of the company. With Ford’s operation in six continents, the company serves 5.7 million customers in the international market. The most prominent markets of the company include North America, South America, Western Europe, Eastern Europe, Russia, Asia and Australia.
Ford acknowledges the importance of customers in the market. The customers of Ford are categorized in three categories i.e. individual retail customers, small business customers and large business customers. With the change in the needs and desires of the customers in terms of mobility, the company is constantly working to enhance its offering with more fuel efficient vehicles (Ford, 2012).
- Dealers
Ford’s dealers are often regarded as the face of the organization in the market i.e. to customers and the communities. In the year 2011, the company reported 11,790 dealers of Ford and Lincoln in the international market. The number of people employed by the dealers in United States reached 158,000 with annual payroll of $6 billion (Ford, 2012).
- Suppliers
Ford has always acknowledged the importance of its suppliers in the local and international market. The success of the organization is significantly aligned with the success of its suppliers. This is one the major reasons that the organization relies upon 1,400 production suppliers. The production suppliers provide Ford with necessary parts required in the assembling of Ford’s high class vehicles. In addition, 9000 additional suppliers provide the organization with variety of goods and services that are essential to survive in the corporate world. The products and services offered by such suppliers include industrial material, computers along with advertisement means (Ford, 2012).
Ford’s supply base is highly global that provides the organization with opportunity to enhance its operations in the emerging markets. This is the particular reason that the success of organization is highly interdependent on the success of suppliers.
- Investors
The success of the company highly impacts the investors of the organization. It has been indicated that the company has 158,000 investors that provides the organization with necessary investments to improve the financial health of the organization. Satisfaction of the investors is considered a priority for the organization. This is done by continually communicating with the investors. In addition, the company is also known for its involvement of conference calls and conferences during the year to provide the investors with insight regarding the organization’s success. Similarly, the company communicates with the investors with its website particularly for the investors (Ford, 2012).
Vision and Mission Statement of Ford
The company has quite clear mission and vision statement i.e. One Ford Mission. The mission statement of the company focuses highly on one team, one plan and one goal which are discussed in detail in the following paragraph (Ford, b):
One Team
The company aims to become a lean enterprise with an aim to achieve leadership in the automotive industry. In order to do so, the company works with its primary stakeholders i.e. customers, employees, dealers, suppliers and investors to create a single team that could work towards the growth of the business (Ford, b).
One Plan
Being the largest manufacturer of vehicles in the global market, Ford aims to restructure its operations that could help the organization to enhance its profitability. This will eventually help to meet the current demand of the customers. Customers being acknowledged as the most beneficial assets of the company, Ford aims to enhance its product offering by accelerating the new product development to meet the desires and wants of the customers in the local and international market. The concept of one team is embedded in the culture of the organization due to which, the organization aims to collaborate and communicate with every single member of the organization to enhance its performance and growth prospects (Ford, b).
One Goal
The single goal of the organization is to make the organization enough flexible to deliver the right product at the right time at the right place to the right customer and in the right market. By doing so, the organization aims to achieve profitable growth for all the products offered to the customers (Ford, b).
(Ford, b)
Code of Ethics
According to Ethisphere Institute; leading business ethics think tank, Ford was one of the world’s most ethical companies in the year 2010 (PR Newswire, 2010). Ford was the only automaker company to receive such an award in the year 2010 (PR Newswire, 2010). The factors that were taken into consideration for such an award include ‘social responsibility efforts, corporate governance and business practices’.
The code of business ethics followed at Ford clearly provides the employees and the suppliers with an insight to work fairly and honestly. All the associates working at Ford are expected to act with the highest sense of integrity inside and outside the company. Protection of the company’s reputation at Ford is considered the top priority due to which, each of the employees and the management are expected to act in the most reputable manner that would eventually protect and enhance the reputation of the company (Ford, 2007).
The employees are well informed regarding their duties and responsibilities in terms of work. In addition, the employees are constantly guided to take measures against personnel that are found to be violating the rules and regulations of the company. To assure that every member of the organization provides the policies and regulations with undivided attention, the company has ensured its members that strict actions would be taken against violation of rules and regulations which may include termination or release.
Moreover, the company embraces diversity and equal employment with open hands. Ford is the most prominent vehicle manufacturing company that is committed to diversity and equal opportunity provider in terms of employment. The hiring policies and practices undertaken by the organization clearly ignore the concept of discrimination on the basis of color, race, religion, gender identity, national origin and disability. Unlike other companies, violation of such policies may result in termination or release (Ford, 2007).
Providing the employees with safe and healthy environment is the commitment of Ford. To maintain such commitment, the organization has devised anti-harassment policy that includes the use of foul language, intimidating conduct or offensive conduct. Each of the members of the company including the vendors is expected to abide by the policy.
In addition, the company considers the concept of socialization with the suppliers, dealers and other business contacts as one of its strong points. With such socialization, Ford aims to cultivate its relationship with the key suppliers and dealers in the market but the company has limited the concept of socialization to a certain limit. The employees along with the associates are continually reminded to socialize with the key suppliers and dealers in such a way that would promote the interests of the company along with its reputation. Moreover, the employees are advised to only accept invitations from the suppliers and dealers that could help the organization enhance its relationship with them and it should be freely offered by the other party. Similarly, the company has also indicated the limitation of activities that should be taken into consideration when attending supplier-paid activities (Ford, 2007).
Ford’s Leadership Challenge
The retirement of Alan Mulally is a challenge for Ford in itself.
Alan Mulally was the first ever person to be hired from outside the industry as chief executive. Mulally served 37 years of his life in the Boeing but by challenging the conventional wisdom, the company hired Alan Mulally (Dempsey, 2012).
When Allan Mulally was hired, the company was in quite depressing situation. In 2006, the company reported a pretax operating loss of $15 billion and was about to file bankruptcy. Mulally took the charge of Ford and changed the traditional strategy that was followed by Ford. He divested all the money-losing luxury brands to focus highly on the core brand Ford. The brands that were divested by the company included Jaguar, Aston Martin, Volvo and Range Rover. The global assets were leveraged more effectively in Mulally’s leadership. In addition, the company in such drastic situation was constantly pushed by Allan Mulally to build multiple models on the same platform, as by doing so, the organization would be provided with an ability to use common parts that can eventually help the organization to capitalize the economies of scale (Dempsey, 2012).
But the retirement of Alan Mulally would leave the future of the organization as a BIG QUESTION mark (?) as the successor of Alan Mulally would have to face serious and tremendous global challenges.
The biggest issue that the organization would have to face would be the cooperation and effective communication. Before Alan Mulally the different regions acted alone as a single entity and resisted to share critical information regarding the design and technology used in the manufacturing of vehicles. With lack of leadership or change in the management, the organization might have to face the same situation once again where the regions and different divisions would act alone i.e. executives would not work together.
Strategy to Overcome the Challenge
The most feasible strategy to overcome such a challenge would be to provide the top management with an opportunity to train and develop their skills. For this to happen, the associates should be encouraged to participate in the learning and development of skills through simulation program. This will significantly help the personnel to demonstrate the interpersonal skills required to motive the employees to work together for the accomplishment of organizational goals rather than personal, divisional or regional goals and objectives.
The company should focus on internal recruitment for the post of Chief Executive. The justification behind such a strategy would be to encourage the employees working for decades to work together with an individual that they have known for quite long. In addition, the succession planning technique/strategy would motivate the employees to work even harder to be provided with an opportunity to take decisions that could change the direction and performance of the company under their leadership.
Ford’s future would be a big question for the company along with the industry. The change in management would eventually lead to changes in operations and practices to enhance the performance of the organization. In order to stay in the right direction, Ford should promote the employees that are best suited for the top management position to be trained under the leadership of Alan Mulally. This would help the personnel to gain the idea of what Alan Mulally was aiming to achieve in the short-run as well as in long-run. This means that by sharing ideas with apprentices, Alan Mulally would be providing the organization with his successor to lead the company to work together for the accomplishment of goals and objectives. In addition, with such apprenticeship Ford would be provided with advanced and broad minded employees that could turn out to be the trump card for the organization to restructure and redesign the vehicles to meet the demands of the customers in the international market.
One Ford is the vision of the company that is quite impossible for the organization that tends to work independently. Effective leadership at Ford would be the only solution to such problem. By focusing highly on effective leadership, the organization would eventually be provided with significant opportunities to expand in the emerging international markets. The in-house training strategy could also be taken into consideration where the individuals would have to take strategic decisions to leverage the global scale and communize the development of vehicles as much as possible. By the in-house training facilities, the organization would be able to transform individuals into effective global leaders that could be geared towards directors and senior managers i.e. the decision makers of the organization.
Conclusion
Being an internationally recognized company, Ford has to take all the stakeholders into consideration. The primary stakeholders of the company include employees, suppliers, dealers, customers and investors. The company aims to work together with the primary stakeholders to create a company that could work together for the betterment of one another in the constantly changing business environment.
Leadership at Ford has become the most challenging factor for the organization after the retirement of Alan Mulally that proved to be a trump card for Ford. The constant change in the management could reduce the performance of the organization as well as the market share. The best feasible strategy would be to promote internal individual to take the position of Alan Mulally. This could be done by promoting the idea of Alan Mulally i.e. to work together to accomplish the short-term and long-term goals through effective communication along with cooperation.
References
Dempsey, J. (2012). What’s next for Ford Motor Co.? Retrieved June 5, 2013, from http://www.dallasnews.com/business/autos-latest-news/20120915-whats-next-for-ford-motor-co..ece
Ford. (2007). Code of conduct handbook: corporate policies and directives. Retrieved June 5, 2013, from http://corporate.ford.com/doc/corporate_conduct_standards.pdf
Ford. (2012). Stakeholder engagement. Retrieved June 5, 2013, from http://corporate.ford.com/microsites/sustainability-report-2011-12/blueprint-governance-stakeholders
Ford. (a). Daimler Ag, Ford Motor Company To Become Primary Stakeholders In New Automotive Fuel Cell Cooperation. Retrieved June 5, 2013, from http://media.ford.com/article_display.cfm?article_id=27189
Ford. (b). Our company: One Ford mission and vision. Retrieved June 5, 2013, from http://corporate.ford.com/our-company/our-company-news-detail/one-ford
Hoovers. (n.d.). Ford motor company profile. Retrieved June 5, 2013, from http://www.hoovers.com/company-information/cs/company-profile.Ford_Motor_Company.7e957f44fa904756.html
PR Newswire. (2010). Ford company recognized as one of the world’s most ethical companies by = Ethisphere. Retrieved June 5, 2013, from http://www.prnewswire.com/news-releases/ford-motor-company-recognized-as-one-of-the-worlds-most-ethical-companies-by-ethisphere-88830282.html
Reuters. (2013). Profile: Ford Motor. Retrieved June 5, 2013, from http://www.reuters.com/finance/stocks/companyProfile?symbol=F.N
Yahoo Finance. (n.d.). Ford motor company profile. Retrieved June 4, 2013, from http://biz.yahoo.com/ic/10/10597.html
