Ford and the World Automobile Industry Case Analysis

Ford and the World Automobile Industry Case Analysis

Christine Miller-Lane

Park University

        Since 1896 when Henry Ford built the first automobile, called a Quadricycle, and then 1903 when Ford became incorporated in 1903 (Ford), they have been a major force in the automobile industry in the United States.  Within a year of being incorporated Ford went international opening a plant in Canada.  While Ford was not the first automobile maker or first to go international, they did revolutionize the automobile industry when Ford Motor introduced the moving assembly line which cut vehicle production by more than 66%.  With only a handful of competition from companies in the industry at this time, Ford Motor began to dominate the industry at it was able to increase production and lower costs quickly. Ford Motor has been striving to anticipate and keep up with the future since, and with some peaks and valleys have been able to hold on so far.  

Synopsis of the Case

Of the top three well known U.S. automobile manufacturer, Ford Motor was the only one to not take federal help during the financial crisis in the automobile industry.  Over the years that followed, changes to their strategy and tactics helped them survive and by 2011 they were able to pay bonuses to its hourly workers. (Hammond) In 2012, Bob Shanks was promoted to the position of Chief Financial Officer for Ford Motor Company. His primary focus was to review financial forecasts made by his predecessor.  While he was confident in Ford’s ability to implement its strategy that was named “One Ford” in 2006 when introduced, he was concerned if they could successfully do so in the face of continuing changes in the automobile industry and its global structure. (Grant 488)  

Relevant Factual Information about the Problem or Decision the Organization Faced

Ford Motor must be able to continue to manage excess capacity as it pursues internationalization and cost reductions. They must strive to be a leader in changes in the industry such as manufacturing technology and new product development, while meeting demand and production as they strive to keep up with market growth, especially in the area of eco-friendly automobiles, which are more and more in demand.

Explanation of Relevant Concepts, Theories and Applications Derived from Course Material

"That Ford was able to survive this harsh environment on its own is impressive,” (Szczesny) Ford Motor successfully managed organizational adaptations and strategic change to their advantage. The willingness to pursue internal changes, such as Bill Ford stepping down as CEO and hiring an outsider to the automobile industry Allan Mullay from Boeing, leveraging assets to stabilize finances, managing suppliers and successfully handling external sources of change, such as fossil fuels and environmentalism, unexpectedly set them apart from their closest competitors.