Ford Motor Company
Ford Motor Company is one of the world's largest producers of cars and trucks and one of the largest providers of automotive financial services marketing vehicles under the eight brands shown below. The Company is a publicly traded company listed on the New York Stock Exchange. During 2002, the company made 6.7 million vehicles and employed 328,000 people worldwide. Business partners include 25,000 dealers and more than 10,000 suppliers.
Ford motor company offers a wealth of variety to the automotive consumer. As they start their second century of business, they are now in a position to appeal to the widest range of potential customers. Each of their automotive brands has a unique personality and holds a distinct place in the ford motor company family.
Vehicle Brands:
Ford
Lincoln
Mercury
Mazda
Volvo
Jaguar
Land Rover
Aston Martin
AUTOMOTIVE SERVICE BRANDS
Introduction
The marketing orientation has become common in companies that make things for individual customers. It remains rare in heavy industry that produces steel, coal, oil, and paper, where the immediate consumers are other businesses. The transition from the production orientation to the marketing orientation is still going on. It is the most important but least understood revolution in human history, marking a decisive power-shift from institutions to individuals. In the production orientation, human enterprise asked first what we could make, and second whether anyone will want it. In the marketing orientation, we ask first what we want, and second how we can invent the means to fill that want. Production made people technology's servants. Marketing makes us technology's masters.
The marketing revolution promises a golden age when social institutions and markets are systematically organized to maximize human happiness. One of marketing's strongest features is its empiricism. What science did for perception, marketing does for production. It tests intuition and insight against empirical fact. Henry Ford thought he knew what people wanted from a car: cheap, reliable, and black. Ford sold millions of model-Ts in the 1920s with this mass marketing strategy. Then General Motors came along, segmenting the market into many strata according to income, age, and tastes, attracting buyers by fulfilling their needs more precisely. Now all car companies work very hard to find out what people really want from cars, and they try to build cars to fit the preferences. Market research uses all the same empirical tools as experimental psychology, but with larger research budgets, better-defined questions, more representative samples of people, and more impact. Ideally, marketing's empiricism works like Rogerian psychotherapy: it holds up a mirror to ourselves, reflecting our beliefs and desires so we can recognize, remember, evaluate, and transform them.
Ford Motor Company is undergoing a transformation that is putting their customers at the center of everything they do. Their vision is to be the world's leading consumer company for automotive products and services. That requires a much different headset than that of a traditional automobile manufacturer—one that concentrates intensely on the people who buy and use their products. Obviously, they had had a pretty good idea of what their customers wanted in the past, or we wouldn't be approaching our 100th anniversary.
For nearly a century, Ford Motor Company has worked to improve people's lives and be a responsible and valuable member of the community. In recent years, they have expanded and accelerated their corporate citizenship efforts, and worked to integrate them into their overall business strategy.
But today's customer—and today's competition—requires a deeper level of understanding. Traditional market research is fine, but it's only the start. To transform the company, require all employees to interact directly with consumers. At the Consumer Insight Center, customers bring their vehicles in and discuss them face-to-face with Ford employees. The emphasis is on the individual's interaction with her or his vehicle. The most well known consumer connection programs is the effort to provide home computers and Internet access to all of employees around the world .Being a leader in corporate citizenship is not only the right thing to do, but also is fully aligned with ultimate goal of providing superior shareholder returns over time.
1. Strong and Differentiated customer proposition.
Ford Motor Company is undergoing a transformation that is putting their customers at the center of everything they do. Their vision is to be the world's leading consumer company for automotive products and services. They constantly measure customer satisfaction to learn what their customers like about their products and services, and what issues need attention. The most important determinants of customer satisfaction are product quality and the experience customers have while using the product. About 75 percent of a customer's satisfaction typically comes from these factors. A customer's sales and service experience typically factors into the remaining 25 percent. That requires a much different headset than that of a traditional automobile manufacturer—one that concentrates intensely on the people who buy and use products.
Consumer driven 6-Sigma, an extensive quality improvement initiative, is a proven method of reducing variability and improving efficiency. While other Fortune 500 companies have implemented 6-Sigma as a cost-cutting tool, Ford taken the 6-Sigma process in a new direction. They used it to identify projects that have the greatest potential to increase customer satisfaction by improving quality and reducing defects.
Feedback from customer surveys, focus groups and other sources helped to identify the top customer concerns. Groups of Ford employee Black Belts and UAW employee Green Belts are trained in statistics and problem-solving to identify ways to address these concerns. All told, Consumer Driven 6-Sigma contributed more than $52 million to Ford Motor Company's bottom line in 2000.
For nearly a century, Ford Motor Company has worked to improve people's lives and be a responsible and valuable member of the community. In recent years, they have expanded and accelerated their corporate citizenship efforts, and worked to integrate them into their overall
business strategy. According to the company's vision, mission and values the customer is Job 1. They do the right thing for the customers, for the people, for the environment and for the society.
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They built strong relationships with the people, communities and organizations. In the last 98 years, they built nearly 300 million cars and trucks. If they hadn't been dependable and responsible, and offered outstanding value to their customers, they wouldn't have a thriving business today. Still they are making quantum improvements to continue to be a thriving business in the future. In this juncture we can accurately declare a score of 15 points to the company's marketing orientation
Maximum score 15
Awarded score 15
2. Ability to anticipate and act on future trends quickly
The advent of the Internet has greatly increased the ability of companies to conduct their business faster, more accurately, over a wide range of time and space, at reduced cost and with the ability to customize and personalize customer offerings. E- marketing describes company efforts to inform, communicate, promote, and sell its products and services over the Internet. The exchange process in the age of information has become customer initiated and customer controlled .the business-to-business sites are changing the supplier customer relationship in profound ways. Ford is using B2B auction sites, spot exchanges, online product catalogues, and other online resources to obtain better prices.
The Ford motor company registered a web site with an Internet domain name for electronic payments, signature security allowing legal documents to be signed and exchanged over the Internet. Ford became the first company in the world to offer computers and Internet access to its employees and their families in their homes for a nominal fee. This program helped Ford employees gain a deeper und customer needs, enhance their computer skills and access learning
opportunities through the Internet. The Web site provides customers with some of the information they need for their purchase decisions. While our e-commerce strategy provides benefits to customers and dealers alike, some dealers see it as a possible threat to their business.
In recent years, by necessity, much of the company's focus has been on the economic dimension of sustainability. In January 2002, they announced a comprehensive, long-term plan to return Ford Motor Company to profitability. The first phase of plan – stabilizing business and getting it back
on a sound operational and financial foundation, was done. As a result of their continuing efforts, the overall financial results have improved by about $5 billion in two years, which was ahead of their plan. .
Ford Company is taking their philosophy of being profitable and responsible to other emerging markets around the world. Asia-Pacific region will be the fastest-growing market for the automotive industry in the coming decade, with China accounting for the largest part of that growth. The company is planning to be aggressive in participating in that growth and strengthening their presence in the region. . Company's ultimate goal is to build great products, a strong business and a better world. Here they deserve the maximum score of 8 points.
Maximum score 8
Awarded score 8
3. Success in launching profitable new products /services which add incremental
sales
Companies that fail to develop new products are putting themselves at great risk. Their existing products are vulnerable to changing customer needs and tastes, new technologies, shortens product cycle, and increased domestic and foreign competition. New technologies are especially threatening. Most companies focus on incremental innovation. Newer companies create disruptive technologies that are cheaper and are more likely to alter the competitive space. Established companies are slow to react or invest in these disruptive technologies because they threaten their investments. Then they suddenly find themselves facing formidable new competitors, and may fail.
A new marketing and advertisement campaign for genuine Ford and Lincoln mercury parts & service for 2005 builds on the strength and momentum of a successful 2004, which saw record levels of Customer Satisfaction and retail sales for Ford and Lincoln Mercury Dealership service.
The central theme of the new campaign's Challenge is "We're Better, We're Proving It and We Want You To Be The Judge," - a theme, which reflects just how confident Ford Company, is in its Dealers' abilities to deliver the best value in service to its owners.
Selected Financial Performance Indicators
INDICATOR 2001 2002 2003
Annual revenue ($ billion) 160.5 162.3 164.2
Income/(loss) from continuing operations ($ billion)* (5.3) 0.3 0.9
Net income/(loss) ($ billion) (5.5) (1.0) 0.5
Stock price range (per share) ($) 14.70–31.42 6.90–18.23 6.58–17.33
Diluted per share amount of income/(loss) from
continuing operations ($) (2.96) 0.15 0.50
Diluted per share amount of net income/(loss) ($) (3.02) (0.54) 0.27
Cash dividends ($) 1.05 0.40 0.40
Earnings retained for use in business ($ billion) 10.5 8.7 8.4
Automotive cash ($ billion)** 17.7 25.3 25.9
Shareholder return (percent)† (30) (39) 79
Extensive research on the new campaign showed that this message is clearly seen as bold and confident and it reflects how customers want to be spoken to - honestly and sincerely - which is just the way they like to be treated when getting their vehicles serviced. Refer to the percentage increase in forecasted sales volume 2003-2014, risky new product development and the Income/(loss) from continuing operations ($ billion)*, undoubtfully Ford deserves a maximum score of 5 as Ford lost on new product development and new products continue to fail at a disturbing rate.
Maximum score 7
Awarded score 5
4. New markets successfully entered in past years
In January 2002, Mr. Bill Ford, the chairman of the Ford Company announced a comprehensive, long-term plan to return Ford Motor Company to profitability. As a result of the continuous efforts the financial results have improved by about $5 billion in two years.
New technology that offers customers no-compromise solutions to concerns about fuel prices and greenhouse gases. The new Ford Escape Hybrid, which reached dealer showrooms, is the cleanest and most fuel-efficient SUV in the world. It uses a combination of gasoline and electric power to deliver more than 35 miles per gallon in city driving without compromising on function. The hybrid system also meets the strictest emissions standards.
In addition to the Escape Hybrid, a hybrid version of the Mercury Mariner compact SUV in 2006, and a hybrid midsize car, a Focus powered by a hydrogen internal combustion engine, a hydrogen hybrid research vehicle and dozens of Focus fuel cell vehicles intended to help chart a course to a hydrogen-powered future. To secure their role in providing mobility to a growing and changing world, automobiles of the future must have dramatically lower smog forming and greenhouse gas emissions. That future will become a reality and it is the key element in building the Company for the next 100 years.
Another recently completed project that points toward the vision of the future is the renovation of the Ford Rouge Center in Dearborn, Michigan. The goal of this Heritage Project is to transform the Rouge complex – which was built more than 85 years ago as the world's first totally integrated manufacturing site – into a model of sustainable manufacturing. In renovating the Ford Rouge Center, drew on the inspirations of the past and aspirations for the future. It has become a very real symbol of where Ford Motor Company is reinventing and redefining it for the 21st century.
The company has developed a comprehensive set of Business Principles and made real progress. The Principles are now being embedded into planning processes and performance scorecards, making explicit high standards regarding products and customers, the environment, safety, community, quality of relationships, financial health, accountability and adopting the philosophy of being profitable and responsible to other emerging markets around the world. Projections show that the Asia-Pacific region will be the fastest-growing market for the automotive industry in the coming decade, with China accounting for the largest part of that growth. The company has plans to be aggressive in participating in that growth and strengthening the presence in the region. The successful presence of the company for the last ten years in the marketing orientation deserves 90% score.
Maximum score 7
Awarded score 6
5.Strong customer focus of total company, including operations, distribution and finance.
Today's companies are facing their toughest competition ever. The companies can out perform the competition if they can move from a product and sales philosophy to a marketing philosophy. The companies need to move rapidly into the new economy and employ Internet, wireless and other technologies to achieve a competitive advantage.
Most of the companies think that, it is the marketing or the sales departments job to acquire and manage customers. But in fact marketing is the only one factor in attracting and keeping customers. The best marketing department in the world cannot sell products that are poorly made or failed to meet a need. People do not swarm to a company's outlet solely because they love the quality, cleanliness and the value.
Unfortunately most marketing theory and practice centers on the art of attracting new customers rather than retaining and cultivating existing ones. A highly satisfied customer says loyal longer, talks favorably about the company and its products, pays less attention to competing brands and is less sensitive to price, offers product or service ideas to the company and costs less to serve than the new customers, because transactions are routine.
Customer Relation
The 1999 Fords annual report is titled "connecting with customers" to reflect the heightened priority that Ford was placing on becoming a customer driven company. The report noted, " A customer driven company must be relentless in its focus. It must listen to its customers, finds ways to fill their needs, and continually seek feedback on how well it is satisfying those needs" Ford expresses its intent as to have customers who" trust our company, love our brands, and delight on our services". To achieve this Ford employs management techniques such as Consumer- Driven six sigma. The goal of Consumer- Driven six sigma is to achieve a value of six sigma which corresponds to only 3.4 defects per million.
Generating Business Impact
All of the programs significantly impact business in two ways: financially and organizationally. Financially, each individual or team project must contribute to customer satisfaction, reduced costs, or increased incremental revenue. And Ford has some impressive statistics.
Participants in QIP programs have generated more than 600 projects, some with significant business impact such as tire recycling, vehicle customization, and new vehicle servicing models.
A recent Ford Supplier/Business Leadership Initiative program identified $300 in cost-reductions per vehicle, which is now in development. Three hundred dollars may not seem like much at first, but when you multiple it by thousands of vehicles, the savings is substantial.
Projects in the Experienced Leader Challenge program have identified more than $100 million in cost-savings and another $100 million in incremental revenue. Over the next three to five years, those numbers will likely climb to the billions in savings and earnings.
We can accurately declare that Ford leadership programs pay for themselves many times over. But that's only part of the story. The second business impact is the effect Ford programs are having on the organization. They're accelerating the process of creating leaders at every level by having emerging and experienced leaders work individually as well as collaboratively on projects of significant merit. They create synergies further among the programs that, in turn, further facilitate learning and speed the development of leadership capacities.
Leadership development is an evolutionary process that changes as the needs of an organization change. Core principles, such as action learning or leader-teachers, may remain. But the what, why, and how of a program should change in response to emerging issues. As one who has taught leadership in an academic and now a corporate setting, I suggest these guidelines when creating a leadership development program:
Create a sense of urgency for leadership development. Leadership is not a nice-to-have; it's a must do. Success in the new economy, or any economy, will require men and women to adopt a transformational mindset that enables them to anticipate change, develop strategies to meet new demands, and continue to maximize growth opportunities. In a nutshell, all of that requires leadership.
Despite years of record earnings, Mr. Jacques Nasser, CEO has been galvanizing Ford to transform itself as quickly as possible in an effort to become a 21st-century company capable of meeting escalating demands and adapting to the rules of the new economy. As a customer driven company the heightened priority that Ford is placing to fulfill the motto "Connecting with customers" reflects a maximum score of 12 points
Maximum score 15
Awarded score 12
6.Strong profit focus of whole company, including marketing and sales.
According to the latest Harbor's Report, an often-quoted measure of North American automotive manufacturing productivity, Ford's legacy production systems and high marketing and incentive costs contributed to low profits-per-car across the Big Three. Even with manufacturing improvements, GM posted only a modest pre-tax profit of $337 per vehicle in 2002, while Ford post $1,913 per vehicle.
Percentage increase in forecasted sales volume 2003-2014
Australia - 13%, Korea - 78%, India - 182%, Asian - 149%, Japan - 6%, China - 111%, U.S. - 12%, Europe - 13%
Projected Growth in Global Automobile Sales
1996
1999
2003
2008
2014
20
18
16
14
12
10
8
6
4
2
0
Million
units Australia Korea India Asian1 Japan China United States Europe2
1 Asian includes: Thailand, Philippines, Indonesia, Singapore, and Malaysia. Data not available for other members.
2 Europe includes: Austria, Belgium, Czech republic, Denmark, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Netherlands, Norway, Poland, Portugal, Spain, Sweden, Switzerland and united kingdom
Note: data exclude heavy truck – class 4 to 8
Source: ford forecast based on global insight inc. forecast data
Their commitment to corporate responsibility required continuing to make business choices that contribute to the long-term economic viability of the Company. But it also required looking at the positive and negative economic impacts associated with each choice. These expenditures and investments typically result in positive global economic impacts—job creation, income for workers and investors, local economic growth and product innovation to name a few. And the
effects of our direct spending and investment patterns are multiplied throughout the economy.The firm's corporate culture committed to creating customer value determines the cent percent score.
Maximum score 10
Awarded score 10
7. Clear long-term strategy led by marketing.
A marketing oriented firm (also called the marketing concept, or consumer focus) is one that allows the wants and needs of customers and potential customers to drive all the firm's strategic decisions. The firm's corporate culture is systematically committed to creating customer value. In order to determine customer wants, the company usually needs to conduct marketing research. The marketer expects that this process, if done correctly, will provide the company with a sustainable competitive advantage.
Objectives are the ends and strategy is the means of achieving them. Ford motor company satisfy their customers by providing quality cars and trucks, developing new products, reducing the time it takes to bring the new vehicles to the market, improving the efficiency of all their plants and processes and building teamwork with employees, unions, dealers and suppliers. The better conceived company's strategies and the proficient execution turned the company into a leading performer in the automobile sector and collected the reputation for talented management.
2003 Performance Highlights
Measuring Performance Against Ford's Business Principles
Key to trends
Better than 2002
Same as 2002
Worse than 2002
INDICATORS 2002/2003 Trend
1 Initial quality (3 months in service), Ford Motor Company, U.S., problems per hundred vehicles 143/136
2 Vehicle dependability (3 years of ownership), Ford Motor Company, U.S., problems per hundred vehicles 354/287
3 Sales satisfaction with dealer/retailer, Ford Brand, U.S., percent completely satisfied 75.0/77.0
4 Sales satisfaction with dealer/retailer, Ford Brand, Europe, percent completely satisfied 64.7/69.0
5 Service satisfaction with dealer/retailer, Ford Brand, U.S., percent completely satisfied 61.0/65.0
6 Service satisfaction with dealer/retailer, Ford Brand, Europe, percent completely satisfied 50.8/54.0
7 Owner loyalty, Ford Motor Company, U.S., percent loyal to corporation 48.5/49.9
8 Owner loyalty, Ford Motor Company, Europe, percent loyal to corporation 49.0/48.0
9 First-time Ford Motor Company buyers, U.S., percent 10.0/11.0
10 Owner loyalty, Ford Brand, Europe, percent loyal to corporation 15.0/13.0
They launch strategic offensives to out- innovate and out-maneuver rivals and secured sustainable competitive advantage. Then used their market edge to achieve superior financial performance.
"Ford is setting an ambitious course to provide long-term value to its shareholders by focusing on the customer. This includes not only increasing customer satisfaction, but also working more
closely with its dealers, strengthening relationships with its suppliers and other efforts linked to good corporate citizenship. This type of behavior should help position Ford not
only as a leader in the automotive industry, but in the business community at large, and ultimately translate into higher value for its shareholders. And contributing a score of 8 points to its credit"
Maximum score 8
Awarded score 8
8. Commitment to constant improvement in quality and value of money.
Ford Motor Company is putting additional emphasis on Product Development Program. The Global Craftsmanship organization was formed to work side-by-side with the worldwide Product Development Program. By focusing on the holistic vehicle system with the "eyes of the consumer", they strived to provide a more satisfying ownership experience.
Vehicles are evaluated in three stages of consumer ownership life: showroom, lifestyle, and maintenance. Worldwide market research was performed to translate these stages of ownership life into an actionable delivery plan for new vehicle programs. The showroom evaluations mimic what a consumer experiences in a dealership as they determine the criteria for their new vehicle purchase.Once the vehicle is in their household, the lifestyle evaluations re-create the many ways the consumer uses the product.
Maintaining a vehicle is easier when under hood fluid fill operations are intuitive to locate and use. As well, many of our consumers enjoy washing their vehicle on a sunny weekend afternoon. This experience is enhanced when the vehicle body surfaces, moldings and bumpers fit well together and stand the test of scrutiny at very close range. Our goal is to create a more personal vehicle experience that strives to anticipate the consumer's individual needs and wants. Global Craftsmanship's worldwide focus allows us to impact the entire range of Ford Motor Company products
New technology that offers customers no-compromise solutions to concerns about fuel prices and greenhouse gases is becoming a major competitive advantage in the industry. To secure their role in providing mobility to a growing and changing world, automobiles of the future must have dramatically lower smog forming and greenhouse gas emissions. Dearborn Truck, which is the flagship of all-new, next-generation flexible manufacturing system, is also clean, energy efficient and environmentally friendly. It features the world's largest "living roof," with more than 10 acres of sedum plants that help to clean the air, generate oxygen and manage storm water runoff.
To clarify company's intentions internally and externally, they have developed a comprehensive set of Business Principles. The Principles are now being embedded into planning processes and performance scorecards, making explicit high standards regarding products and customers, the environment, safety, community, quality of relationships, financial health and accountability
People buy cars and trucks for a variety of reasons: safety, quality, cost, style, and dealer service. It is in this context that we must consider the company's efforts to define physical and social responsibility. Undertaking recalls on other new and existing Ford products. Implementing a socially responsible approach to restructuring Ford operations, including planned closure of vehicle assembly operations. Improving customer and dealer satisfaction levels. Addressing workplace issues, including diversity and work life integration. Improving quality with suppliers and Increasing total shareholder returns. Developing and implementing a strategic action plan on climate change that results in reductions over time and contributes constructively to public. identifying an open minded approach Ford company attains a score of 8 points.
Maximum score 10
Awarded score 8
Old e-strategy vs New strategy
Old e-strategy Fate New strategy Payoff
Dash portals To give new cars Web access, satellite phone services and e-mail capabilities, and collect millions in Net services fees Projects halted, Wingcast telematics effort scrapped, buyers turned off by glitchy technology and pricey markups Telematics being used by Ford's delivery fleet only, to monitor fuel costs.
Fleet maintenance costs are decreasing
Retailing
To create Buyer Connection Web site with Microsoft to let Ford buyers bypass dealer markups and order cars factory-direct Ford dissolved Microsoft partnership Ford Direct site, run by dealers, is now used to boost sales. In the past year, Ford sold 100,000 cars from leads that wouldn't have been generated otherwise, for extra revenues of $1.6 billion
Service
To create Owner Connection Web site to improve service and collect customer data by letting owners manage their own warranty service Worries over privacy leaks doomed the effort Net-enabled factory systems to cut service costs, track defects and fix them—before cars leave the plant. Quality improved 13 percent in 2002; recall alerts now based on eight problem reports vs. 60 before.
Suppliers
To save $750 billion industry wide and earn $3 billion annually in exchange fees by co-launching the Covisint B2B to reap better price and parts deals from 30,000 vendors Squabbling among GM, Ford, Daimler Chrysler, Renault and Nissan over security leaks and other issues limited use and savings. Covisint's new computer messaging service will let OEMs and suppliers communicate more easily, securely and effectively Pending
Marketing
To team with Yahoo! CarPoint, i Village and bolt.com to monitor the car-buying patterns of Web-surfers.
Consumer Connect effort was downsized and absorbed into Ford's traditional marketing group; Owner Connect effort refocused on data- collection Develop a Ford-only customer data center from 50 million customer records and let all Ford businesses use it. Pending
Wired Workers To offer all 350,000 employees a computer, printer and Net access for $5 a month to allow factory-floor adoption of new Net strategy.
Ford offered 158,000 employees the service but postponed further rollout, then scrapped the program to cut costs None Halting the program saves millions of dollars in hardware costs and service fees
9. More efficient/lower cost operator those competitors
To meet the quality challenge at Ford's truck plant in Louisville, Ky., one of several producing the F-Series pickup, a wireless monitoring quality verification system has been introduced A system that tracks the vehicle as it makes its way through assembly via bar-coding, software and sensors. The idea is to make sure that no assembly steps are left undone, and that each vehicle passes a series of performance and quality tests along the way. Should something be missed, an electronically controlled gate won't let it out of the plant.
By creating a business analytics system to gather and analyze data coming from a variety of sources, including Ford's warranty processing offices, emergency call centers and 6,000 dealers. By "mining that data," problems that might have long gone unnoticed could flag before they get far into the assembly process.
cost savings, also speeds time to market. The new Ford GT sports car. Modeled after the legendary GT40 that Ford successfully campaigned on the European racing circuit 30 years ago, its 500-plus horsepower V-8 will push the new two-seater to speeds approaching 200 miles an hour. But this GT was designed with speed in mind—the first virtually designed vehicle on the Ford product lot
Not long ago, an automaker like Ford would need four to five years to transform a concept vehicle into a production car, but the GT project, thanks to IT collaboration technology, is on course to break the production speed barrier: Unveiled in concept form at the North American International Auto Show in January 2002, it didn't get the formal go-ahead until nearly three months later. Yet a running prototype was ready in November, and the first customers will start taking delivery in June 2003. The GT "has been virtually designed and virtually engineered," says Chris Theodore, Ford vice president of product development.
The use of computer-aided design, engineering and manufacturing systems has been extremely successful in improving the productivity of product development. Ford is also pushing ahead to use IT more to boost collaboration, especially on the product development side, where more of the process is going digital.
The online Consumer Connect unit has effectively disappeared, but now that dealers are running the Ford Direct.com retail site, it is having a measurable impact on sales. It is now generating 10,000 sales a month from Net leads, and sold 100,000 vehicles this way last year—60 percent of those from leads it wouldn't have gotten otherwise
Maximum score 12
Awarded score 10
10. Level of investment compared with operators (facilities, databases,
technology, advertising, R&D ,people developments)
Ford motor company beams training programmes and technical information via satellite based ford star network to more than 6000 dealer sites. Service engineers at each dealership sit around a conference table and view a monitor on whom an instructor explains procedures such as repairing onboard electronics and asks and answer questions. Ford developed training programmes that can be delivered to dealer over the Internet.
New Communication Technologies
Ford is a major client of Northwest Airlines, which dominates the Detroit air hub, and Ford operates a fleet of its own aircraft at Detroit Metropolitan Airport. It takes a toll, especially when senior executives are consistently out of reach. But these days, Scheele can reach more people in less time; thanks to a worldwide leadership team videoconference scheduled every Monday morning. The automaker now operates more than 500 video conferencing sites worldwide, and over the next two to three years, its goal is to reach into virtually every office and conference room in the company.
"We will start moving our traditional videoconferencing into the IP space," says George Surdu, Ford's director of technical services, "and go to Voice over IP in telephony. The age of connecting two PCs over the Internet will allow us to get very sophisticated at a very cost-effective price." Can Adams pull it all off? No question that the bulk of Adams' IT strategy, he says, is "correction mode"—for now. But Adams also believes that Ford can and must get IT strategy in better sync with business goals before Ford can start moving to more sophisticated real-time marketing and production systems—the key to more cost savings and sales gains. That sounds about right to Ford critics. "The message is that Ford has now recommitted itself to making and selling better cars, and that's a good thing," says analyst Phillippi. Adams is more analytical. "We've recognized that the higher ROI comes from technology that's deeply integrated into the core operating systems, practices and processes of the company—not a strategy that puts an Internet veneer in front of things that still need to be fixed," Adams says. "For us and most corporations, the real Internet revolution—new, information-enabled ways to make, buy, market and sell products—has really just begun."
And last but not least, Ford, like many companies, is investing heavily in Web-based communications systems. But for inside the company, the efficiency of Ford's relentless effort, all the way up to the top tiers of management. Facilities t o public and staff , databases, technology, advertising, R&D ,people developments, training and education bags a maximum score of 8 points.
Maximum score 8
Awarded score 8
Measure of Success
In January 2002, Mr. Bill Ford, the chairman of the Ford Company announced a comprehensive, long-term plan to return Ford Motor Company to profitability. As a result of the continuous efforts the financial results have improved by about $5 billion in two years
For ford dealers, training at the local dealership saves time and money on lost productivity, travel, and other associated costs. The one touch e-learning solution also enables higher attendance, improved learning, and measurably higher comprehension. The result is a better-trained dealer staff capable of delivering superior customer service. The tangible benefit to ford is enhanced owner satisfaction, increased customer loyalty, and reduced service costs. As a result of the success to date with the domestic e-learning network, ford is implementing the one touch system on a global basis including sites in Europe, Australia, and Canada.
New technology that offers customers no-compromise solutions to concerns about fuel prices and greenhouse gases is becoming a major competitive advantage in industry. The fastest way to bring about the transition is to seek through the market and competition.
The new Ford Escape Hybrid is the cleanest and most fuel-efficient SUV in the world. It uses a combination of gasoline and electric power to deliver more than 35 miles per gallon in city driving without compromising on function. In addition to the Escape Hybrid a hybrid version of the Mercury Mariner compact SUV in 2006, and a hybrid midsize car, a hydrogen hybrid research vehicle and dozens of Focus fuel cell vehicles are deploying in demonstration fleets in the United States, Canada and Germany.
To secure their role in providing mobility to a growing and changing world, automobiles of the future must have dramatically lower smog forming and greenhouse gas emissions. Another recently completed project that points toward the vision of the future is the renovation of the Ford Rouge Center in Dearborn, Michigan, called the Heritage Project was to transform Rouge complex – which was built more than 85 years ago as the world's first totally integrated manufacturing site – into a model of sustainable manufacturing.
The renovations included a new lean and green manufacturing facility, the Dearborn Truck Plant, which recently began producing F-150s. It is the first all-new assembly plant built in the Rouge complex since it was first developed, and the first anywhere in the United States in more than 25 years. Dearborn Truck, which is the flagship of our all-new, next-generation flexible manufacturing system, is also clean, energy efficient and environmentally friendly. It features the world's largest "living roof," with more than 10 acres of sedum plants that help to clean the air, generate oxygen and manage storm water runoff. In renovating the Ford Rouge Center, Ford drew on the inspirations of the past and aspirations for the future.
It has become a very real symbol of where Ford Motor Company is building their own heritage and reinventing and redefining it for the 21st century. Henry Ford understood the potential for companies to create wealth, not only for shareholders, but also for communities and entire classes of people. This understanding is reflected in their marketing and financial commitments to make mutually beneficial investments in the markets in which they operate. A new model of corporate community investment that includes traditional areas of philanthropy and volunteerism, as well as new commercial–community relationships clearly bags a score of 90 points for their marketing achievements. By understanding the perspectives of those who are affected by these operations, they can develop more focused strategies for improving the net impacts on the community. These processes will help them to access new sources of innovation, use resources more effectively and strengthen the communities.
Criteria of rating
Ford Motor Company
on its marketing orientation
Maximum score Awarded score
1 Strong and Differentiated customer proposition. 15 15
2 Ability to anticipate and act on future trends quickly 8 8
3 Success in launching profitable new products /services which add incremental sales 7 5
4 New markets successfully entered in past five years – "Five Years of Progress" 7 6
5 Strong customer focus of total company, including operations, distribution and finance 15 12
6 Strong profit focus of whole company, including marketing and sales 10 10
7 Clear long-term strategy led by marketing 8 8
8 Commitment to constant improvement in quality and value of money 10 8
9 More efficient/lower cost operator those competitors 12 10
10 Level of investment compared with operators (facilities, databases, technology, advertising, R&D and people developments) 8 8
Total score 100 90
Conclusion
Ford Motor Company started the last century with a single man envisioning products that would meet the needs of people in a world on the verge of high-gear industrialization. Today, Ford Motor Company is a family of automotive brands consisting of: Ford, Lincoln, Mercury, Mazda, Jaguar, Land Rover, Aston Martin, and Volvo. The company is beginning its second century of existence with a worldwide organization that retains and expands Henry Ford's heritage by developing products that serve the varying and ever-changing needs of people in the global community.
References
1 www. ford .com
2 www.prenhall.com
3 Financial report Ford motor company 2002.2003 and 2004
4 Letter from Bill Ford - Published by Ford Company
5 Marketing management -Philip Kotler
6 Strategic Management - Thompson,Strickland
7 Marketing Management MRKT 601 course notes
8 Marketing Management MRKT 601 course discussions
