Milestone 4
- Corporate Strategy: Business Diversification
Ford's Mission is One Ford - One Team, One Plan and One Goal. The organization is into related diversification since it is manufacturing different light commercial vehicles and cars for the people. However, they have been focusing more upon technology and quality parameters so as to sustain in the given increasing competition in the entire industry. The segment includes three car categories, which are the Sedans, SUVs, and the Hatchbacks. The target population for this organization includes young executives, businessmen, and small families.
There are different brands available of ford, and as per the research statistics of 2012, the net revenues of the organization were around $134 billion. However, the company is facing stiff competition from Honda Motor Company, Chrysler Group LLC, General Motors Company, Daimler AG, Tata Motors Ltd., and many others in the given market. But, the organization has still turned successful through related diversification. It is manufacturing light commercial vehicles, cars, and buses to a certain limited extent.
Surely, this has helped the organization to remain and sustain in the given competition of the entire industry. However, they have sold off certain brands due to which, they will be able to receive huge financial inflows. They thereby need to channelize all these funds and utilize it for the development of new models (Saloner, Shepard, & Podolny, 2001). They need to capture additional market share in the Asian markets, which are still untapped for them in a given scenario. They already have good vision and mission objectives, and hence, they now just need to focus upon the execution of their strategies in the right and appropriate direction.
Ford is required to tap the new opportunities of many of the markets, and thereby increase its net sales so as to improve their profitability. They need to occupy the market space offered in India and China through differentiation and introducing of new models that utilizes the new green technology. This is how it will help them to execute in a better way from the strategic perspective in the near future.
- Ethics, Social Responsibility, and Environmental Sustainability
As per the governmental reports of US in 2013, Ford is considered to be one of the best ethically working companies all around the world. The entire organization has adapted to different ethical principles so as to prevent unethical issues within the organization. In addition, the company has been focusing heavily upon the Corporate Social Responsibility (CSR) initiative. They have awarded some of the best social change visionaries, for their notable contribution in the given society. As per the annual reports of the organization, in 2013, the total funds donated to the local high schools crossed the mark of $5 million.
In order to provide maximum advantage to their customers, they have designed new innovated models. Some of the examples of their innovation include Hybrid Motor Vehicles and the Liquid-Cool Battery system. In addition, to improve their models they have constantly tried to receive the feedback from their customers. If we talk about their social responsibility, they have escalated their initiatives in this direction as well (Alaez-Aller & Barneto-Carmona, 2008).
Some of the noteworthy contributions by the organization include - helping the orphanage, protecting the environment, and assisting the poor people by financially supporting them. Ford has always aimed for helping the lower class of the people, by providing them some form of job opportunities, looking after the education of the children, and also protecting the environment by supporting and developing the initiative of making green models. Here, green models would reflect the making of the car models that will be running on green energy modes.
Milestone 5
- Strategy Execution: Building the Capability to Execute Strategy
The entire structure of the organization is diversified, and hence, there is no need of any other organization structure or culture in the given present situation. It is a global organization, and hence, there are employees working from all parts of the world. Thus, we could observe cultural diversity across the organization, due to which, there could be several challenges for the Human Resource (HR) Department of the organization. However, the HR Department in association with the top-level management has been playing a key role for overcoming all the challenges regarding the recruitment process and the training programs for the employees of the organization (Aoshima, 2002).
The HR Department has formulated teams in such a way that, it comprises of several employees from different nations and cultures. Thus, instead of acting as a weakness, it is becoming the strengths for the organization. They have been even forming teams as per the different requirements of the departments of the organization. They are aware of the cultural conflicts issue, but they have been tackling it well inside the organization.
In addition, the HR Department has been taking great care of the employees so as to motivate them and increase their job satisfaction levels. They have been providing favorable compensation packages and bonus benefits to their employees for their best performance in the organization. In addition, they have been taking great care of the families of their employees, their annual leaves, and their leisure life as well.
The organization has been following a matrix structure in the organization. But, due to increased global presence it will become intensely difficult for the Middle-Level Managers especially to handle all the cross-cultural teams that are working in the organization. However, the divisional head is also assigned with a similar responsibility to handle the entire territory of the given region.
Hence, in order to achieve the strategic objectives of the organization, the HR personnel can establish strategic relationship with these divisional heads, and accordingly allocate the different resources as per the requirements of the organization (Barnes & Morris, 2004). They need to plan together in an optimistic way so as to achieve the objectives of the entire organization. In addition, the HR Department needs to provide enough training to all the staff members so that they can gain knowledge on the latest technologies and other operational updates. They are even trained on the course of soft skills so as to improve their time management and presentation skills. For this purpose, Ford has even formed specific policies for the employees of the organization.
- Strategy Execution: Managing Internal Operations
As mentioned earlier, the HR Department has been taking food care of the all the employees of the organization. Despite of wide cultural diversity across the organization, the HR Department in association with the Middle-Level Managers has formulated teams as per the different requirements of the organization. In addition, today, the company has even started using the information systems not only to streamline all the processed and functions of the organization, but also to monitor the performance of all the employees of the organization.
The HR Manager has been motivating the employees by either rewarding the employees or promoting certain best performers on year-on-year basis. This seems to be the best practice adopted by the organization, since we can judge the performance of the employee in different conditions over a long time period. On the other hand, once the performance is judged, the employee is rewarded accordingly.
The current compensation packages offered by Ford seem to be matching a lot with the competitors such as Chrysler, Daimler AG, and General Motors Company. The packages are more or less aligned to each other; however, some of the extra-ordinary employee is provided with higher packages, but provided that he is also assigned higher responsibilities. The company can thus be rated to be best performing in terms of compensation packages (Catalan, 2010). The company is also sometimes giving shares of the organization on the basis of the performance of the organization.
However, for further improvement, they can introduce Balance Score Card system so as to achieve the strategic objective of the organization regarding expansion in the Asian markets. Hence, for this purpose, they will require employees that will be performing well on all the perspectives. However, the organization is ready to provide appropriate compensation packages to such high performing employees of the organization.
- Strategy Execution: Leadership
In order to become more competitive-based organization, the top-level management including the board of directors and the CEO, need to tap the emerging markets by improving their net sales. They need to focus upon their differentiation strategy in order to first of all create a market space for them in the given scenario. Further, they need to change their strategy and make it more aggressive and dynamic in order to meet the requirements of change management. Further, as per the annual reports of 2013, it was found that, they want to leverage upon flexibility and efficiency gains through One Ford Plan. They want to launch new models of small cars in the Asia-Pacific territories; along with that, they are also planning to launch the same in the European and African markets so as to accelerate their global development.
They also need to focus heavily upon their marketing activities in order to attract the customers and drag them toward their stores. For this purpose, they can utilize various mediums of advertising through which they can mark their vision and footprint in the global markets all around the world. For this purpose, they need to establish collaboration with the vice presidents and executive officers of all the departments that are located in different parts of the world (Catalan, 2010). They need to accordingly formulate the strategies that will help them in achieving the strategic objectives for the organization.
References
Saloner, G., Shepard, A., & Podolny, J. (2001). Strategic management. New York: John Wiley.
Alaez-Aller, R. and Barneto-Carmona, M. (2008). Evaluating the risk of plant closure in the automotive industry in Spain. European planning studies, 16(1), 61-80.
Aoshima, Y. (2002). Transfer of system knowledge across generations in new product development: Empirical observations from Japanese automobile development. Industrial Relations, 41(4), 605-628.
Barnes, J. and Morris, M.(2004). The German connection: shifting hegemony in the political economy of the South African automotive industry. Industrial and corporate change, 13(5), 789-814.
Catalan, J. (2010). Strategic policy revisited: The origins of mass production in the motor industry of Argentina, Korea and Spain, 1945-87. Business history, 52(2), 207-230.
