Ford Motor Company: Implementing the 'One Ford' Strategy

            
 
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Case Details:

Case Code : BSTR423
Case Length : 18 Pages
Period : 2006-2012
Pub Date : 2013
Teaching Note :Not Available
Organization : Ford Motor Company
Industry : Automotive
Countries : US; Global

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.



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Excerpts Contd...

The Results

In 2009, Ford recorded a pre-tax operating profit of $454 million and a net income of $2.7 billion. This was the first time since 2005 that Ford had posted a full-year positive net income. In 2009, Ford's market share in the US increased to 15.3 percent, an increase of 1 percent compared to 2008. Ford's market share in Europe went up to 9.1 percent, a half point increase compared to the previous year; this was the highest in 11 years. And in China, Ford sales were up 45 percent although it continued to be a minor player in the region...

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Challenges

Implementing the One Ford strategy was not without its share of challenges. Mulally knew that Ford's culture would pose a significant challenge in the implementation of the strategy. With time, Ford's culture had become bureaucratic and corrosive, with internal politics ruling the roost and personal advancement taking precedence over the company's interests. Also, Ford's divisions operated independently; this resulted in silos, where employees in one division had little or no interaction with employees of other divisions. Mulally started to break down the silos and change the way people worked, integrating the different regions. Under him, Ford also became a more open and collaborative place, a change from its previous culture of "empire building and back-biting". However, although Ford's US operations were able to make major improvements, Ford Europe continued to struggle...

The Road Ahead

The "Great Recession" of 2007-09 had a major impact on the global automobile industry, with demand, especially in developed markets, stagnating or sinking. While the economic outlook seemed to have improved since then, there was uncertainty regarding the financial market environment, analysts said. The labor markets in several countries continued to remain weak. Also, the continuing tightness in the credit markets didn't bode well for sustained growth. All this indicated that the demand for cars would remain low, especially in the developed markets...

Exhibits

Exhibit I: Plant Closure Announcements Made as Part of the 'Way Forward' Plan
Exhibit II: Ford's Global Product Strategy
Exhibit III: ACH Plant Closures
Exhibit IV: Employment Data At Ford's Worldwide Operations Between 2005 And 2011
Exhibit V: New or Upgraded Product Launches
Exhibit VI: The Blue Oval
Exhibit VII: About Premier Automotive Group (PAG)
Exhibit VIII: Financial Highlights between 2005 and 2011
Exhibit IX: Ford's Share Price between Oct' 2005 and Oct' 2008
Exhibit X(A): Market Shares of Major Players in the Chinese Automobile Market between 2009 And 2011
Exhibit X(B): Market Shares Of Major Players in the Indian Passenger Auto Market between 2009 And 2012


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