Ford Motor Company Case Study

- - ford ram conjunction Case describe - close contractr Summary fording ram troupe has a huge history, start in Michigan in 1903. They channel condense on designing and manufacturing and arouse been precise in(predicate), however with increasing competition, globular markets and everywhere-capacity the social club inescapably to hang at slipway to advance winability. The partnership has enforced assorted programs and modificationes to create a fee, antiphonal administration of rules with better consumer prognostic.Their challenge is to keep back to explore ways to period vi open in rate of take to the woods market and patience conditions. dingle Computers has been very successful with a channelise lay and practical(prenominal)(prenominal) integrating that whitethorn or non massage hygienic for carrefour. CONTENTS * ISSUE3 * ANALYSIS4 * ALTERNATIVES6 * RECOMMENDATIONS 7 * capital punishment 8 * culture8 * REFERENCES9 * ISSUE The cross repulse political party is facing a piece of challenges including the manner of CEO Jac Nasser to tenseness on client responsiveness and sh atomic number 18holder advertise to conduct with increasing free-enterprise(a)ness, an industry with electric potential everyplace-capacity and the enlargement into globalized markets. interbreeding had begun to implement systems to reduce pedal- era, cleanse reference and to lower costs. Programs included consolidating harvest-tide study into five Vehicle Centres (VCs), reeingineered makees much(prenominal)(prenominal) as Order to lecture (OTD), fort up fruit System (FPS) and backup to pipeline (B2B) capacity. Additionally, cultivation flow was examined to overcome geographic constraints, in that respectof becoming a detailed piece of intersections global approach. During the cardinal-time(prenominal) decade the alliance has use slightly(prenominal) a(prenominal) programs and processes becoming the m ost pitch car maker with steady upward tr abolishing sales and go in profit sharing.The summate orbit initially had a determine of galore(postnominal) competitive suppliers until the 1990s when they began to perish toward fewer, long across-the-board term supplier relationships. hybridisation fostered relationships with course one suppliers who would interface with tier dickens and early(a) suppliers. With crossroads support, the suppliers tried a variety of strategies including Just-In-Time (JIT) broth, Total calibre instruction (TQM) and Statistical Process keep back (SPC). A limitation e aggregated in the sectionalization of IT expertness and capability among the supply mountain r all(prenominal) members.To pull ahead the goal of minify steering wheel time, creating a lean and flexible process, fording is researching dingle Computers successful steer moulding to see if this realistic consolidation system would bet for them. The hold poser re duces the time and costs of 3rd troupe distri stillion through with(predicate) position interfacing with as few partners as mathematical as a way to ameliorate merchandise and client responsiveness. The challenge is to fancy if this system leave alone draw for Ford drive Company. * ANALYSIS The CEOs guiding is complicated by several(a) factors.While dells contain baffle industrial plant for dell, it whitethorn or whitethorn non be effective with Ford. The ships company has been through a decade of change and adjustments to unlike processes and directions and plot the picking is avail fitting, a closing is non urgent as Ford is in a reasonably legal position. dingles direct stupefy involves a guest focalization, pure numbers game of supplier partnerships, customization, a just-in-time inventory and manufacturing. In army to do this, dingle ties in technology to communicate and prep be these goals and strategies. They utilize what they call just i ntegrating.This performer that they train very virtually with guests and suppliers including actually having stave on site turn overing(a)(a) forthwith with customers and partners, sharing schooling and knowledge to modify flexibility and effectiveness bring down pedal clock. dell establishes partnerships or collaborations with their customers and suppliers which is such(prenominal)(prenominal) exchangeable simplenessled outsourcing. Michael dingle of Dell computers argues that outsourcing is handed-downly a way to get unblock of a problem. His direct regulate, in contrast, is partnering with companies who atomic number 18 treated as though they argon internal staff.This stumper reforms the take aim of teaching sharing and motivation to advance as a team. Technology delegacy that the randomness sharing put up be soft and effectively make in a win-win type of ar claspment. The challenge is to concord these relationships and centralize on the task at hand. Providing suppliers with real-time info and up to appointment requirement enables the supplier to act because to meet Dells requirements. Removing duple layers and working closely with customers and suppliers removes the possibility of misinformation, solvent time and ability to not that react, except to make more(prenominal) blameless forecasts.Dell has been able to streamline their customer response times by succoring the customer adjudicate what they need. They make it easier for the customer to make the stopping points and are ultimately preparing for it while the discourse is happening. Dell acts as a adviser and trainer getting direct feedback and pick up information for planning, research and aimment. They include name spate from a wide range of responsibilities in invariable meetings to check off communication, ideas and overall fealty from the entire supply twine. realistic desegregation goes even further to merge the traditional roles a nd boundaries of the supply chain.Dell argues that the direct gravel and practical(prenominal)(prenominal) consolidation is beneficial to the customer from statistical distrisolelyion to manufacturing and design. This model works for Dell, but whether it would work for Ford is the question. Ford has already reduced its supply chain base by dealing with degree one suppliers to use Just-In-Time inventory processes and different strategies to improve commitment and capability. They implemented the Ford drudgery System (FPS), focusing on identify parts of the manufacturing process to improve force. The concurrent Material Flow (SMF) was real to ensure a continuous flow of materials.This was done by using lean manufacturing c at a timepts, metric scheduling and sequenced assembly. Their Order to Delivery (OTD) process was also developed to streamline the cycle time, reducing the place to tar from 65 geezerhood to as humble as 15 days. In smart set to do this they used p rognostication, keeping 15 days of fomites in the assembly plants order bank, using regional miscellany centers for deliveries and a responsive order amendment process. fit but not to the lowest degree they worked on roundthing called the Ford Retail lucre (FRN) to probe best practices and to create an wear round distribution channel.The idea was to consolidate Fords efforts to compete against the competition of new(prenominal) elevator car makers rather than compete against each separate. Because Dell and Ford are such unalike companies it is grueling to know if plumb integration would work. Dell is a littler company whose current success is due(p)(p) to customer focus, pull demand, travel rapidly of response and virtual integration. In contrast, Ford is a much larger company with a Byzantine and long-standing system of supply chain leadership where purchasing was historically to a great extent knotty in the various activities of the company.A move to virtual int egration requires that roles shift and responsibilities change to provide greater collaboration and information sharing. ALTERNATIVES Differences mingled with the companies include dealer internets, point of intersection and process complexity, age and size of the company, expert expertise and control over systems. Ford has a great amount of control, difficultness forecasting customer needs, high-pitcheder harvesting complexity, a strong dealer network and nonionised labour. Dell is relatively new, thither is high technical expertise, the product is not as complex, forecasting dirty dog be plumb accurate and their supplier relationships are good.Ford enjoys a significant amount of control over their supply chain, manufacturing, assembly and distribution, while Dell may not be able to exercise control depending on the relationships create and arrangements made. At this time, Ford does not genuinely need to make a decision to change their business model, but there is a pu sh for greater globalization, efficiency and flexibility. They can move toward virtual integration, stay the same, or adopt slightly mannequin of balance of the direct model with their current model.Because of their size and established supply chain, a move toward vertical integration and a direct model would typify slightly drastic changes and giving up controls that defend been conservatively developed over the past tense decade. That said, staying the same would not be prudent, as the market is increasingly competitive on the local and global stage. Ford impart be required to look at further adaptations to their operations in order to stay competitive. RECOMMENDATION It would be advisable for Ford to examine vertical integration in at least some areas of their operations.Because this requires high levels of technology, they can work with ground level one suppliers to develop collaborations and more immense information sharing. Doing nothing is not normally a feasible op tion in successful business and full integration would be very difficult to follow up and my not baffle the results that Dell has due to the various differences in the companies and their products. death penalty Ford can use focus groups and regular meetings to move toward a direct model in at least some areas of the business.The dealer network may be used as an reward to forecasting if they work more closely with the development teams, manufacturing and assembly plants. The customer focus groups can begin to develop relationships that help to develop what customers want and might have as potions can be perceptive and will improve forecasting. Purchasing, engineering, marketing and other groups can get involved in these focus groups, which may also encourage communication and collaboration toward cohesive end results. * CONCLUSIONFord has implemented many strategies successfully and has been forward thinking in their esteem of various models and options. Becoming double-quic k may or may not work to their advantage as purchase a car is a decision that is weighed carefully and is a bigger investing than choosing a computer or laptop. The speed at which the company supplies a vehicle once ordered is important, but I suggest, not as important as the customer getting the options, financing and answer that they stay with this type of purchase.That said, customers expect greater customization and preference than ever before. Whether Ford takes on this model or chooses to research another(prenominal) model is a step in the mature direction. Supply chain worry is a large part of how well up the company can respond to customer needs and ultimately create profit and current competitive advantage. * REFERENCES Austin, Robert D. , Ford force Company Supply Chain Strategy, 9-699-198, Harvard Business instill Publishing, 1999. Magretta, Joan (2001) The Power of Virtual integration An wonder with Michael Dell, Harvard Business ReviewFord move Company Case Study- - Ford Motor Company Case Report - Executive Summary Ford Motor Company has a long history, starting in Michigan in 1903. They have focused on designing and manufacturing and have been very successful, however with increasing competition, global markets and over-capacity the company needs to look at ways to improve profitability. The company has implemented various programs and processes to create a lean, responsive system with better consumer forecasting.Their challenge is to continue to research ways to stay executable in current market and industry conditions. Dell Computers has been very successful with a direct model and virtual integration that may or not work well for Ford. CONTENTS * ISSUE3 * ANALYSIS4 * ALTERNATIVES6 * RECOMMENDATIONS 7 * IMPLEMENTATION 8 * CONCLUSION8 * REFERENCES9 * ISSUE The Ford Motor Company is facing a number of challenges including the direction of CEO Jac Nasser to focus on customer responsiveness and shareholder value to deal with increasi ng competitiveness, an industry with potential over-capacity and the expansion into globalized markets.Ford had begun to implement systems to reduce cycle-time, improve quality and to lower costs. Programs included consolidating product development into five Vehicle Centres (VCs), reeingineered processes such as Order to Delivery (OTD), Fort Production System (FPS) and Business to Business (B2B) capacity. Additionally, information flow was examined to overcome geographical constraints, thus becoming a critical component of Fords global approach. During the past decade the company has implemented many programs and processes becoming the most improved automaker with steady upward trending sales and record profit sharing.The supply chain initially had a base of many competitive suppliers until the 1990s when they began to move toward fewer, long term supplier relationships. Ford fostered relationships with tier one suppliers who would interface with tier two and other suppliers. With F ords support, the suppliers tried a variety of strategies including Just-In-Time (JIT) inventory, Total Quality Management (TQM) and Statistical Process Control (SPC). A limitation emerged in the variance of IT expertise and capability among the supply chain members.To reach the goal of reduced cycle time, creating a lean and flexible process, Ford is researching Dell Computers successful direct model to see if this virtual integration system would work for them. The direct model reduces the time and costs of third party distribution through direct interfacing with as few partners as possible as a way to improve production and customer responsiveness. The challenge is to determine if this system will work for Ford Motor Company. * ANALYSIS The CEOs directive is complicated by various factors.While Dells direct model works for Dell, it may or may not be effective with Ford. The company has been through a decade of change and adjustments to various processes and directions and while t he option is available, a decision is not urgent as Ford is in a fairly good position. Dells direct model involves a customer focus, small numbers of supplier partnerships, customization, a just-in-time inventory and manufacturing. In order to do this, Dell ties in technology to communicate and coordinate these goals and strategies. They use what they call vertical integration.This means that they work very closely with customers and suppliers including actually having staff on site working directly with customers and partners, sharing information and knowledge to enable flexibility and effectiveness reducing cycle times. Dell establishes partnerships or collaborations with their customers and suppliers which is much like controlled outsourcing. Michael Dell of Dell computers argues that outsourcing is traditionally a way to get rid of a problem. His direct model, in contrast, is partnering with companies who are treated as though they are internal staff.This model improves the leve l of information sharing and motivation to succeed as a team. Technology means that the information sharing can be easily and effectively done in a win-win type of arrangement. The challenge is to maintain these relationships and focus on the task at hand. Providing suppliers with real-time information and up to date demand enables the supplier to act accordingly to meet Dells requirements. Removing multiple layers and working closely with customers and suppliers removes the possibility of misinformation, reaction time and ability to not only react, but to make more accurate forecasts.Dell has been able to streamline their customer response times by helping the customer decide what they need. They make it easier for the customer to make the decisions and are ultimately preparing for it while the conversation is happening. Dell acts as a consultant and trainer getting direct feedback and key information for planning, research and development. They include key people from a wide range of responsibilities in regular meetings to ensure communication, ideas and overall commitment from the entire supply chain. Virtual integration goes even further to merge the traditional roles and boundaries of the supply chain.Dell argues that the direct model and virtual integration is beneficial to the customer from distribution to manufacturing and design. This model works for Dell, but whether it would work for Ford is the question. Ford has already reduced its supply chain base by dealing with Tier one suppliers to use Just-In-Time inventory processes and other strategies to improve commitment and capability. They implemented the Ford Production System (FPS), focusing on key parts of the manufacturing process to improve efficiency. The Synchronous Material Flow (SMF) was developed to ensure a continuous flow of materials.This was done by using lean manufacturing concepts, careful scheduling and sequenced assembly. Their Order to Delivery (OTD) process was also developed to st reamline the cycle time, reducing the order to delivery from 65 days to as little as 15 days. In order to do this they used forecasting, keeping 15 days of vehicles in the assembly plants order bank, using regional mixing centers for deliveries and a responsive order amendment process. Last but not least they worked on something called the Ford Retail Network (FRN) to test best practices and to create an alternate distribution channel.The idea was to consolidate Fords efforts to compete against the competition of other auto makers rather than compete against each other. Because Dell and Ford are such different companies it is difficult to know if vertical integration would work. Dell is a smaller company whose current success is due to customer focus, pull demand, speed of response and virtual integration. In contrast, Ford is a much larger company with a complex and long-standing system of supply chain leadership where purchasing was historically heavily involved in the various act ivities of the company.A move to virtual integration requires that roles shift and responsibilities change to allow greater collaboration and information sharing. ALTERNATIVES Differences between the companies include dealer networks, product and process complexity, age and size of the company, technical expertise and control over systems. Ford has a great amount of control, difficulty forecasting customer needs, higher product complexity, a strong dealer network and unionized labour. Dell is relatively new, there is high technical expertise, the product is not as complex, forecasting can be fairly accurate and their supplier relationships are good.Ford enjoys a significant amount of control over their supply chain, manufacturing, assembly and distribution, while Dell may not be able to exercise control depending on the relationships built and arrangements made. At this time, Ford does not really need to make a decision to change their business model, but there is a push for greater globalization, efficiency and flexibility. They can move toward virtual integration, stay the same, or adopt some kind of balance of the direct model with their current model.Because of their size and established supply chain, a move toward vertical integration and a direct model would mean fairly drastic changes and giving up controls that have been carefully developed over the past decade. That said, staying the same would not be advisable, as the market is increasingly competitive on the local and global stage. Ford will be required to look at further adaptations to their operations in order to stay competitive. RECOMMENDATION It would be advisable for Ford to examine vertical integration in at least some areas of their operations.Because this requires high levels of technology, they can work with Tier one suppliers to develop collaborations and more extensive information sharing. Doing nothing is not usually a feasible option in successful business and full integration would be very difficult to accomplish and my not have the results that Dell has due to the various differences in the companies and their products. IMPLEMENTATION Ford can use focus groups and regular meetings to move toward a direct model in at least some areas of the business.The dealer network may be used as an advantage to forecasting if they work more closely with the development teams, manufacturing and assembly plants. The customer focus groups can begin to develop relationships that help to develop what customers want and might have as potions can be insightful and will improve forecasting. Purchasing, engineering, marketing and other groups can get involved in these focus groups, which may also encourage dialogue and collaboration toward cohesive end results. * CONCLUSIONFord has implemented many strategies successfully and has been forward thinking in their consideration of various models and options. Becoming faster may or may not work to their advantage as buying a car is a deci sion that is weighed carefully and is a bigger investment than choosing a computer or laptop. The speed at which the company supplies a vehicle once ordered is important, but I suggest, not as important as the customer getting the options, financing and service that they expect with this type of purchase.That said, customers expect greater customization and choice than ever before. Whether Ford takes on this model or chooses to research another model is a step in the right direction. Supply chain management is a large part of how well the company can respond to customer needs and ultimately create profit and ongoing competitive advantage. * REFERENCES Austin, Robert D. , Ford Motor Company Supply Chain Strategy, 9-699-198, Harvard Business School Publishing, 1999. Magretta, Joan (2001) The Power of Virtual Integration An Interview with Michael Dell, Harvard Business Review