Recalling the distinction between corporate and business str

Recalling the distinction between corporate and business strategies, apply the key concepts for analyzing the scope of Ford Motor Company. What corporate strategies should be considered to enhance the performance of Ford Motor Company?

Solution

Business (or Strategic) management is the art, science, and craft of formulating, implementing and evaluating cross-functional decisions that will enable an organization to achieve its long-term objectives. It is the process of specifying the organization\'s mission, vision and objectives, developing policies and plans, often in terms of projects and programs, which are designed to achieve these objectives, and then allocating resources to implement the policies and plans, projects and programs. Strategic management seeks to coordinate and integrate the activities of the various functional areas of a business in order to achieve long-term organizational objectives. A balanced scorecard is often used to evaluate the overall performance of the business and its progress towards objectives.

Corporate strategy provides the guidelines for the businesses to achieve their long term objectives. When developing a corporate strategy, it is essential to determine the purpose and the scope of the organizational activities. Then about the nature of its business by considering the environment in which it operates, its marketplace position and the level of competition it faces.

Corporate strategy is created based on the vision of the organization. This is the most important level of strategy since it is heavily influenced by the investors in the business activities and acts to guide strategic decision-making throughout the business. Corporate strategy is verbally expressed in the company mission statement. Usually, in every organization the top management is responsible for establishing the corporate strategy.

A strategic business unit can consist of a product line, division, or other profit centers that can be planned separately from the other business units of the company. At this level, there are less strategic issues relating to the coordination of operating units and about developing and achieving a sustainable competitive advantage for the manufactured goods and services.

The strategy formulation phase at the business level deals with:

• Positioning of the business against rivals.

• Strategy need to be changed according to the expected changes in the demand.

• Influence the nature of competition through vertical integration and political actions such aslobbying.

According to Michael Porter, there are three generic strategies; they are cost leadership, differentiation, and focus that can be implemented at the business unit level in order to create a competitive advantage for the company.

Business-level strategies are extremely useful for solving practical problems. These strategies are used by line managers to find solutions to problems that arise in day to day operations such as reduction in sales revenue or reduction in production efficiency.

Concepts for analyzing the scope of Ford Motor Company

After many decades, the company launched a new strategy plan in 2000 to focus on the 21 century. The new strategy was aimed an in creasing the market share, increase the revenues earned and production of smart cars with fuel efficiency. Ford implemented the centralized decision making system. This allowed the company to concentrate on the available market opportunities both locally and internationally. With the implementation of centralized decision making system, the top management becomes more engaged in the development of products to satisfy the customer expectation in various markets (porter, 1986). This strategy allowed the company to improve the communication system from top to bottom.

Ford motors adopted the strategy that allowed it low production cost by cutting all the excessive cost involved in this operations. The huge expenditure on raw materials was cut down and the online manufacturing process was introducd that focus on the development of cars on one process rather than having different segments of engineering and production. This strategy was establishes cost advantage and give the company advantage over its competitors in terms of lower cost (porter, 1983), in the mean while company focused on producing smart cars that were not price sensitive and offered the functionality of traditional ford cars.

The market position of ford has been enchanced due to multiple factors. Firstly, since it fought hard against bancruptcy and refused governmental funding as its competitors did, the consumer trust has increased in the company and its brands. Secondly, its products are widely accepted by the cunsomers and integrating with the first factor, the company has increased market share. Lastly, the company has adopted the strategy to provide smart cars to the cunsomers it will further benefit the company in terms of market share and increased volumes (GLG Expert, 2009). Ford can benefit from the industrial recovery by offering and focusing on the consumer-oriented products and give value to them while generating reasonable profits.

The demand for better fuel economic cars has increased due to high energy prices with the increasing wealth of developing world; the ford motors currently believe in providing few automobile models to sell around the globe with some modifications; to be called world cars. Ford fiesta is the first world car which was designed by ford europe and was produced in US and China. The future strategy of ford company is to develop more world cars with the idea of providing standarized products to its worldwide markets. The company developed its competitive edge thet carried it to the future. They introduced a technology which was already in use by its competitors but wich the new perspective and modification. The tech gadget called ford SYNC. It is a science sync-equipped in the vehicles thet can connect the driver with so many options

Ford SYNC is a company fitted, fully integrated communication and entertainment system that connects the users with internet, through his smart phone and allows them to make telephone calls and control music and other functions using voice commands. This system is the integrated interface developed by ford and microsoft that operates on microsoft Windows Embedded Automotive operating system

Most companies in the auto industry are taking similar steps to gain an advantage, but Ford has its own strategy to get the most out of their value chain. Ford is now taking steps to enhance supplier relations. By improving these relations, Ford hopes to ensure consistent production of parts and supplies. By reducing the number of suppliers and offering bigger and longer contracts to the remaining suppliers, Ford hopes to be able to reduce costs while increasing quality and consistency. “If the parts suppliers collapse, the automakers would face paralyzing production disruptions and financial repercussions of their own.”

Ford should Focus on following corporate strategies to enhance the performance (Althought they have Implemented most of this)

Corporate Citizenship

A Ford Corporate Citizenship Report should stress on the company sees to indicate that there are no conflict between business goals and social and environmental needs. In real Leaders of the company believe that the distinction between a good company and a great one is that a good company delivers excellent products and services, while a great company delivers excellent products and services and strives to improve the world. Overall, Ford believes that the company needs leaders who can make informed business decisions and who can help the company better meet customer needs, increase shareholder value, and honor responsibilities to society.

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Training New Leaders

Ford should conduct training new leaders who will help the company to prepare for a new business era and reach its goal of making a difference in the world. Ford provides training for its leaders in the Ford Leadership Center, where the focus in on building leaders, both men and women, who know how to get things done through the talents of their people. These leaders also learn to think \"outside the box\" by abandoning their comfort zones in everything from selecting a work project to working with new people.

Harnessing the Power of IT

At Ford Motor Company, Information Technology goes beyond the traditional IT or MIS departments at other companies to bring more efficient processes and systems in every area.

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People at the IT department of the company focus on their vision, which states, \"When asked, our customers, clients, suppliers, partners, employees, and stakeholders say, without hesitation, that Information Technology is a critical and competitive differentiator for Ford Motor Company.\" The employees hold themselves to this high standard with pride. They write in their statement, \"Our work is about being a leader, a leader who applies information technology and process reengineering techniques to every part of the company, tracing the critical path through their complex business. It’s about being a consultant who understands the areas we support and helps them embrace change. Our work is with people, though our tool is the computer.\"

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Continuous Improvement

The 80/20 Principle is used in many corporate quality management programs. InFord Electronic Manufacturing Corporation\'s quality program that won the Shingo prize,just-in-time programs have been applied using the 80/20 rule (80% of the value is spread over 20% of the volume) and top-dollar usages are analyzed constantly. \"Labor and overhead performance were replaced by Manufacturing Cycle Time analysis by product line, reducing product cycle time by 95%.\"  >>>

Servicing Diverse Customers

The Ford\'s customer base is becoming increasingly diverse as the company expand globally and as their established markets themselves become more diverse. This influences Ford\'s product development and marketing approaches.

For example, women make up more than 54 percent of U.S. Volvo customers. “Your Concept Car” was designed by a group of female engineers, designers and marketing professionals who strove to reflect what women say they want in a vehicle.

Ford is also conducting research and vehicle development geared toward customers with special needs, such as limited mobility. A Ford Europe product design team focused on making Ford products the brand of choice for people with mobility issues. At many corporately owned locations in Europe, Hertz is offering vehicles equipped with hand controls at no additional charge for disabled customers.

As their customer base becomes more diverse, Ford have adjusted their marketing and communications. For example, Jaguar and Volvo launched advertising campaigns back in 2003 that reached out directly to gay, lesbian, bisexual and transgendered customers. The company are also actively exploring alternative offerings and features targeting baby boomers who are known for their active lifestyles.