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Brands like Puma in sport shoes industry. it is easy for us to see brands like Sony. reality became very different from general predictions. was historically known to be the creator of the first’s motorcycles and pioneer in motorcycle industry.Ford Motor Company Page 1 1. in business. Interestingly. At one occasion. These conditions. Nike.net in free email services are examples of slowing down and thus worst brands in the world. this paper will elaborate a `Strategic Audit` for the Ford Corporation. shopping centers. there are some brands that we used to know very well but suddenly they disappear or are eliminated in their respective markets. British Motorcycle Industry. Fiat in automobiles or USA. 2007 . In contrast. Then. or across the sidewalk in our neighborhoods. the industry simply loses their existence. it is common to find out companies that loose their market share and no longer have their dominance in their industry. However. for instance. while they are natural and common within today’s fierce competition. these companies were predicted to last forever and help shape the future. are the results of effectiveness of marketing plan including the incurred marketing strategy. The audit composes of eight sections such as current company SEPT. 18. or Calvin Klein in the nearest malls. Introduction Nowadays. Therefore. During the golden age. for most of us that have become those brands’ fans should not be worry if we have to travel abroad since the brands have evolved from local to global brands and are available anywhere in the world. in the beginning of the 20th century. McDonald’s. Concerning the rise and fall of a company. people think that the industry would grow forever and generate unlimited innovations for the global markets.
Current performance There are various factors contributors to the current downtrend of the Ford Motor Company such as the high employees’ benefits and pension costs. Management of Ford Motor Company stated that the downsizing program is crucial to address the excess capacity (Jani. Current Situation 2. 18. Toyota Motor Corp. the most recognized performance is inefficiency.3 billions in 2006. In terms of revenue. to name a few .1. However. and the decreasing business of manufacturing. the increasing costs of fuels. which have taken most of the company’s investment and resulted in minimum returns (Ford Motor Company.Ford Motor Company Page 2 performance. In 2005.5 billions and declined into $143. North America. In addition. in 2005. 2007a). strategic alternatives and implementation. external and internal environment analysis.4 millions of vehicles but a year later the sales declined into 3 millions of sold vehicles. the company generated $153. It is said that Ford’s factories in North America are operating at only 86% capacity compared to 107% of their competition. the company sold 3. and competitors’ better competitive advantages. The declining performance is due to the lose market share in SUV and small truck lines. SEPT. Ford Motor Company also experiences declining sales in its main market. 2. 2007 . 2002).
Strategies Realizing the fierce competition in automotive industry. the company develops some anticipation actions to deal with the possible declining sales in North America market.Ford Motor Company Page 3 2. which is to focus on automotive business.2. 2007a). 2007 . Strategic Posture 2. this objective is considerably general since managements can justify their actions to expand into other business as long as it relates to automotive. the company decides to rely on four key principles/strategies as following: • Conduct restructuring in order to help Ford Motor Company to earn profits even in markets that sell lower volumes of vehicles • Improve product development and eliminating any complexity/difficulties in manufacturing • • Generating and maintaining enough liquidity to finance the two most priority Encouraging teamwork and accountability throughout the company’s operation (Ford Motor Company.2.1. In order to address market trends.2. previously represent 13 percent of revenue in 2005 (Ford Motor Company. One obvious action is to provide financial services that contribute about 10. However. 2007a). 18. SEPT. 2.2. Objectives The company has one main objective.5 percent of the company’s revenue.
for example. used to be Chief Executive Officer. One similar characteristic that Ford’s board of directors has is their background in which at top level.Ford Motor Company Page 4 3. 2007a). the company also has vast top managements. Butler (59) used to be Chief Executive Officer at KPMG. John Flemming is the Group Vice President at Europe (Ford Motor Company. Strategic Managers 3. becomes the Group Vice President at North America. most of directors have vast experience in financial and retail services. Europe etc) has one Group Vice President to address each market needs. is the Group Vice President for SEPT. 18.1. Parker.2. John R. Fransisco N Codina. 2007a). Bond (65 years old) previously served as non-executive chairman at HSBC. This fact highlights that Ford has problems and managing their fund as justified in their strategies (see section 2. the company also has some top managements each is responsible for particular brand. Stephen G. Meanwhile. Jr. Hockaday. Top Managements In addition to board of directors.2. Board of Directors Ford Company is considerably a fat organization. 2007 . John G. According to 2006 Annual Report. H. Inc. 3. Hallmark Cards..3) and it also explains why the company also serve financial service in addition to their core business in automotive manufacturing. for instance. composing of 12 persons in Board of Directors and more than twenty executives. composing of Executive Officers Group and a number of Vice Presidents. we see that the company’s top managements’ structure are distributed into regional group in which each region (North America. Irvine O. In addition to regional model. and many others (Ford Motor Company. LLP.
Internal Environment (IFAS table is in Excel format) 6.Ford Motor Company Page 5 Mazda. External Environment (EFAS table is in Excel format) 5. Within the strategy. Strategic Alternatives & Recommended Strategy: Economics of Scale According to several resources. SEPT. 1996). Analysis of Strategic Factors (SFAS table is in Excel format) 7. the strategy increases time-efficiency (Smith. 2007a). developing affordable price is not heavily true since customers would think there is a sacrifice to build ‘cheap’ cars like security. economics of scale. accessories etc. 4. the company strives for producing vehicles in the most efficient cost structure and in the most timely manner and sell as many as they can. Therefore. Ford’s general strategy is to meet a single goal. Pros • Ford’s production and pricing strategy are mostly directed to achieve faster and cheaper ways to build cars for market demands. Therefore. Lewis K Booth is Executive Vice President for Ford’ luxury lines: Volvo. Jaguar. Cons • Customers are segmented. and Land Rover (Ford Motor Company. 2007 . It helps the company to build affordable vehicles for customers • The strategy helps the company finds the production time cycle from 36 to 24 months and reducing platforms from 24 to 16. 18.
Recommended Strategy Despite being known as efficient producer of cheaper cars in the historical days. especially within these hard times (the declining market share in some key markets) • Design a New Market Image The company is known as producer of high quality and luxury cars with premium prices. • Introduce Hybrid Cars: Maintaining Ford’s Brand Name SEPT. still there are several recommendations to the Ford Motor Company to help increase the company’s conditions. 2001). a change of leadership will also send a good message toward stakeholders. For instance. 18. Volvo and Lincoln. Ford needs to find it new and better programs to demonstrate the new product image.1. there are considerable developments within Ford’s strategic directions today. Besides providing means to escape the old image. 2007 .Ford Motor Company Page 6 7. Although. This image is losing to futuristic and ‘younger’ designs of cars that offer both quality and distinction. The Luxury division is established in 1999 to coordinate their luxury brands like Jaguar. the company has successfully made brand extension for their luxury cars segments. Ford requires a new style of leadership. It is about a legacy that is maintained and hoped to provide customers with the same amount of satisfaction. the company is in the right position to become a major force in the luxury segment (Banks. land Rover. • Change of Leadership According to some automotive analysts. The current image is about stability and elegance. the company is now also aiming to be the market leader in the luxury car segment. Managers of the company believed that by coordinating these brands.
Honda and many others.000.000 Budgets (USD) 2.000 20. Evaluation & Control Table 2 No 1 2 Evaluation and Control Plan Communication Activities Customer Gathering (Product Presentation and Retention Program) Visiting Universities (Looking for talents and conducting research Measure for Evaluation/Control The number of Audiences at the Customer Gathering (minimum 500 people per seminar-day) Participants/Audience Feedbacks SEPT.Ford Motor Company Page 7 Currently. Where are Ford’s cars? Although hybrid cars would not saleable within the next one year. July 2007 Harvard University. 18.000 • • • • • • Time Schedule (2008) Detroit Motor Show Tokyo Motor Show Frankfurt Motor Show MIT. March 2007 Texas University. Dec 2007 monthly Any time 9.000 40. Sept 2007 • Stanford University. 2007 . there are many kind hybrid cars from various brands such as Toyota. 8. Implementation Table 1 No 1 Implementation Plan Activities Customer Gathering (Product Presentation and Retention 3 Program) Visiting Universities (Looking for talents and conducting research agreement) 4 5 Press Release Website Updates 30. and the Honda Insight. still Ford should develop its prototype to tell customers they cope with the trend. Honda Civic Hybrid (HCH). Some examples of famous hybrid cars include the Toyota Prius.
2007 . 18.Ford Motor Company Page 8 agreement) 3 4 Press Release Website Updates on product improvement Post-seminar Sales Record/Achievement News Distributed into Media Web sites updated once a changes/new activities occur SEPT.
(2005). Retrieved September 17. (2005). Diane. Retrieved September 18. 2007 . Retrieved September 17. Philip.itcilo. Lee. International Labor Organization. Bryce G. Ford Try to Alter Pricing Strategy.org/2002-1/390/390_12_FordLayoffs. 2007 from http://www.com/money/autos/search Ford Motor Company. Slumping Ford Picks Employee Brains. (2002).htm Ford Motor Company.socialistworker. Retrieved September 18. 2006 Annual Report. 18.wikipedia. Pranav. Cliff. 2007 from http://en.action? siteNodeId=136&languageId=1&contentId=14794 Carty. New Jersey: Prentice Hall Inc.detnews.org/wiki/Ford_Motor_Company Hoffman.com/2005/autosinsider/0510/25/C01-359823. Retrieved September 17. (2006). Sharon Silke. Retrieved September 17.Ford Motor Company Page 9 Reference: Banks.usatoday. (2002) State Programs offer Alternative to Layoffs.org/live/ViewPage. (2002). Retrieved September 17. Marketing Management. (2007a). Special Dealership are Part of Ford’s Luxury Strategy.htm Jani. 2007 from http://www. Ford Makes Worker Pay. Sustar. (2001).com/ar/auto_special_dealerships_part/index. 2007 from http://wardsdealer. 2007 from http://www.it/english/actrav/telearn/global/ilo/seura/mains. 2007 from http://www. GM. SEPT.stateline. 2007 from http://www.html Cadrain. (2006).shtml Kotler. Labor Market Trends and Globalization Impact on Them.
htm Smith. 2007 from http://wardsautoworld.com/2005/autosinsider/ 0506/17/C01-218739. (2007b).ford. Ford Pays Workers to Sell Cars.com/en/company/about/partnersAndSuppliers.Ford Motor Company Page 10 ---.ford. GLOBAL MANUFACTURING STRATEGY GIVES FORD COMPETITIVE ADVANTAGE. Retrieved September 18. Retrieved September 18. Partners and Suppliers.htm Work Sharing Unemployment Insurance Program. How Ford’s new Brand Strategy Works. 2005. David C. (2006). (2005).cfm?article_id=13633 ---. 18. 2007 .com/article_display. (1996).com/ar/search Tierney. Retrieved September 18. 2007 from http://media.detnews. EDD Fact Sheet -State of California SEPT. Christine. 2007 from http://www. Retrieved September 18. 2007 from www.