case study of ford

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How a century-old brand is transforming the auto industry

Before the pandemic, automakers were already facing massive disruption, including driverless cars, electric vehicles, and shared mobility. But COVID-19 dealt another blow: Automotive was one of the hardest hit sectors in 2020, especially in the U.S., where auto sales sank by 15% .

In the midst of these unprecedented challenges, however, 118-year-old Ford Motor Company leaned in and began to reinvent itself.

As the virus accelerated, dealerships were forced to close their lots and shift to servicing and selling cars online , while larger supply chain concerns caused shortages in critical parts like microchips, which slowed vehicle production.

In the midst of these unprecedented challenges, however, 118-year-old Ford Motor Company leaned in and began to reinvent itself. Under the leadership of two new executives — Jim Farley as CEO and Suzy Deering as global CMO — the company saw an opportunity for business transformation and started mapping out a strategy.

Questioning everything, from its organizational structure to its customer experience, Ford made difficult decisions to put technology at the center of its business and get ahead of auto consumers’ evolving needs.

While still in the early stages of its journey, Ford has developed something of a blueprint for auto brands of the future. Recently, I spoke to Farley and Deering about the company’s transformation strategy. They shared three key changes they’re focused on.

1. Reimagining what auto brands do

Business transformation has been a buzzword for decades, but for years, it wasn’t an urgent reality for Ford. Then along came the pandemic, and its significance accelerated.

We have to invest in electric architectures and build software know-how in the company. And we need to integrate that know-how in ways we’ve never had to before.

“Events of 2020 made it clear that modernization is required to be a sustainable company,” explains Farley. A critical factor to modernizing has been disrupting its organizational model to aid the shift toward vehicle electrification and other digitally connected products. Since consumers expect more safety and convenience from automakers, the future of the auto industry will increasingly exist outside the doors of the vehicle.

According to Farley, this has required Ford to “unglue” its organization to allow for a new way of being. “The biggest transformation for us is to a software services–dominated company and brand,” he explains. “We have to invest in electric architectures and build software know-how in the company. And we need to integrate that know-how in ways we’ve never had to before.”

Such a fundamental pivot, Deering acknowledges, impacts company culture. “We have to make sure that we bring people along with us, and at the same time, give them the space to fail. There is strength in knowing that change is not going to be easy, but we’re going to do it together, and we’re going to look forward.”

2. Driving the connected car experience forward

By committing to look forward, the automaker is building on Henry Ford’s original vision — that every American consumer can own a vehicle — by reimagining what vehicle ownership looks like. Through software and other technology, Ford is working to ensure that it’s a fully connected, always-on experience.

When we have the ability to update our products dynamically with software, the customer relationship is no longer episodic. It’s every day.

“For so long, cars have really been isolated from the rest of people’s lives. We can change that by making them digital products,” Farley explains. To facilitate this shift, Ford has tapped into strategic partners like Google and is integrating software into its vehicles. Beginning in 2023, for example, millions of Ford and Lincoln models will be powered by the Android operating system, with Google apps and services built in.

Beyond offering drivers more assistance and convenience, connected vehicles also give Ford the ability to deepen its customer relationships. “When we have the ability to update our products dynamically with software, the customer relationship is no longer episodic. It’s every day,” says Farley.

3. Transforming the customer relationship model

To deliver on its vision of an always-on customer experience, Ford is also evolving how it approaches relationship-building. While many automakers stick to a traditional acquisition model to attract consumers through ads and rebates, Ford is bringing customer relationships to the forefront by shifting to a loyalty-based model.

“Another big transition for us as a company — and an industry — is to stop being obsessed with conquest and start putting all of our resources into taking care of the customers who already love the brand and own the product,” Farley explains. “This is a model that is available because of the always-on nature of digital. Our products and services are now integrated.”

We want to know our customers well enough to meet their needs while they’re in the vehicle, while they’re outside the vehicle, and before they even think about buying a vehicle.

Gearing marketing efforts to meet people’s ongoing needs in a more personalized way is critical to Ford’s loyalty-based push, because, as Deering points out, “The customer expects us to know them.”

For Deering and her team, this means relying more than ever on first-party data and signals to create an ecosystem that nurtures deeper relationships. “We want to know our customers well enough to meet their needs while they’re in the vehicle, while they’re outside the vehicle, and before they even think about buying a vehicle from us,” she explains.

While Deering and Farley both readily admit that Ford’s business transformation is a yearslong journey, they’re committed to playing the long game and continuing to drive brand love and loyalty through the 21st century.

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Ford Motor Company Case Study

Looking for Ford industry analysis? Find it here! We’ve prepared Ford Motor Company case study that contains analysis of the company’s financial condition and provides recommendations to its management.

Introduction

• Industry Analysis
• Environmental Scan
• Financial Condition
• Recommendations

Works Cited

The current report provides an in-depth analysis of the motor vehicle industry based on the Ford Motor Company case study. It also analyzes Ford Motor Company using SWOT analytical tool. Moreover, strategies that could be adopted by Ford Motor Company for the next five years have been provided. The study is divided in several sections with the first section being the motor vehicle industry analysis.

The industry analysis explores the industry structure, major environmental changes, competitors, and Ford’s competitive position in the industry. The second section gives an environmental scan with major focus on the major opportunities and threats. The third section explores the company’s key strengths and weaknesses. The last section gives viable strategic recommendations which can be adopted for the next five years.

Ford Industry Analysis

The motor vehicle industry is very competitive and characterized by changes in vehicles design and technology (CLLES 7. Just like any other industry, the motor vehicle industrial structure and landscape have been changing and reshaping operationally, functionally, and geographically.

The increase in competition has been as a result of new emerging automotive and vehicle industries in South American, Eastern and Central European, and Asian countries (CLLES 7). The industry’s major structures are the motor vehicle and the motor vehicle parts sections.

These two sections provide employment to more than one million people in U.S. The motor vehicle industry is a loosely connected industry and diversified in terms of supply chain structure, employment levels and compensation. Lastly, the market is characterized with excess capacity which is a major structural problem.

The industry was highly affected by the 2007/2008 global financial crisis. Major players such as Chrysler and General Motor were majorly affected that it took the intervention of the government to bail them out.

However, based on the case study, Ford Motor Company was the only major company which was not affected by the financial crisis. The company has been described by as the only automaker company which has survived the major crises that have hit the motor industry without financial bailout by the government (The New York Times 2012).

The major competitors of Ford Motor Company are BMW, Chrysler, Toyota, General Motors, Honda, Nissan, Mercedes Benz, and Hyundai-Kia among others. In U.S, General Motors (GM), Toyota, and Honda are the main competitors of Ford (Canis and Yacobucci 6). Different automakers use different strategies to increase their competitive advantage.

Based on the case study, Toyota uses lean production to increase its effectiveness and efficiency in production. Toyota’s lean production encourages just-in-time scheduling, flexible production, teamwork, and quality production. In addition, the company avoids material wastage and inventories. Another company like Hyundai produces quality products to meet the demands outside Korea.

For instance, the company has recently established a production line in Alabama, U.S to near KIA to benefit from economies of scale (Canis and Yacobucci 6). In addition, the company offers the longest warranties which are geared towards the attraction of customers from the Japanese and US cars. In general, all the major competitors have brand product portfolio which are part of product diversification and cost differentiation.

General Motors which is the largest competitor of Ford Company has adopted a new strategy which has been borrowed from Toyota Company (Ferrell & Hartline 30). The new strategy is based on new auto designs which meet the expectations and demands of emerging market segments.

The company has acquired the Toyota’s design which involves synchronization of production, platforms, and parts from different parts of the world. This new globalization strategy encourages flexible manufacturing. Based on checks and benchmarking carried by Henry (91), the competitors in the automobile industry are grouped in four groups.

The first group is of high price and low range automobiles and it consists of Rolls Royce and Bentley. The second group comprises of Ferrari, Ashton Martin and Porsche while the third group contains BMW, Mercedes, and Lexus. The last group is composed of Ford, Renault, Honda, Volkswagen, GM, Nissan, Toyota, and Daimler Chrysler (Henry 91).

The Lexus, BMW and Mercedes group produces highly priced and quality products but of a lower product range. The Last group produces a broad range of products which have considerably low prices and quality compared to other groups. In this group, competitors compete in the market based on reliability, price, and the design of their products (Henry 92).

Ford is the second largest automaker after General Motor. The American automaker has found its niche in car and truck production. The company has a strong brand which has improved its competitive advantage. Product diversification has been the major competitive advantage thus increasing its competitive position in the industry.

To maintain its competitive position, Ford brands product portfolio comprises of Ford Ikon, Ford Fiesta, Ford, Fusion, Ford Endeavor, and Ford Figo. Its survival under numerous financial crises has increased the confidence and trust from different stakeholders especially consumers (The New York Times 2012). In North America, Ford remains as the largest market shareholder.

However, the company receives high competition in new emerging markets in Asia and Europe. Nonetheless, the American automaker has continued to defend its position in the industry and in 2008, it closed the gap that existed between itself and Toyota. The company was able to sell over 55,301 vehicles compared to Toyota in 2009 (Canis and Yacobucci 6).

Based on the current statistics, Ford has a market share of 15.5% after GM which has a market share of 19.8 percent (Canis and Yacobucci 6). The fall of GM and Chrysler was beneficial to Ford as many buyers between 2008 and 2009 preferred Ford cars thus increasing its financial and competitive position in the market.

As other companies market shares declined, that of Ford increased. To remain competitive, the company has provided new models which are affordable, competitive, and environmentally friendly.

Ford Company Analysis: Environmental Scan

Environmental scan has been carried through the use of SWOT analysis to give the major opportunities and threats that Ford Company has.

Company analysis

Ford Company Analysis: Financial Condition

The company is in a better financial position compared to other players such as Chrysler and GM. In 2008, the company survived the U.S and Europe financial crises (The New York Times 2012). In addition, as other companies’ market share reduced, Ford’s market share increased to 15.5% while that of GM’s dropped to 19.8 % (Canis and Yacobucci 6). In 2009, Ford increased its sales by 55,301 vehicles compared to Toyota.

In 2011, Ford increased its small cars sales in U.S by 25 percent (Ford Motor Company 2012). The annual operating profits of Ford increased in 2011 and as a result, the company announced an operating pre-tax profit of $8.8 billion (Ford Motor Company 2012).

In a third year in a row, the company has announced improved annual operating profits which show that the company is in a better financial position. According to Ford Motor Company 2011 annual sustainability report, the company has increased its annual automotive gross cash which is a sign of financial progress (Ford Motor Company 2012).

The revenues of Ford have grown from USD 119.3 billion in 2011 to USD 128.2 billion in 2012 (Bloomberg Businessweek 2012). In addition, the company has reduced its sales pegged on income tax expense to -0.90% from -0.505 thus leading to a bottom line growth of USD 20.2 billion from USD 6.6 billion (Bloomberg Businessweek 2012).

Because of its financial position, the automaker plans to invest $16 billion in the U.S production plants with the objective of designing, engineering and producing upgraded vehicle components. Therefore, Ford Motor Company financial position is strong despite the recession and economic downturns.

Ford Case Study: Recommendations

Based on the industry and company analysis, some suggestions have been provided which can be applied for the next 5 years as part of strategic plan management. First, Ford needs to expand its market operations in emerging economies in Africa, Middle East, and Asia so as to reduce overreliance of the U.S market. This would expand its market share and meet new demand in new market segments.

Second, the company needs to diversify its products to meet the demands and expectations of consumers in the 21 st century. Ford needs to carry out market and consumer demand research to determine the major emerging market trends and patterns. Product diversification can be achieved through the production of more fuel efficient and environmentally clean cars which are small in size.

This would meet the demand in the new segment of environmentally sustainable and green fuel motor vehicles. Ford can adopt the strategy adopted by Toyota of producing a variety of cars annually which fit different market segments. For example, it can design cars that meet the income capacity of consumers in developing nations.

Drawing from the case study analysis, Ford is the second largest American based automaker in the world. In addition, the company operates in a very competitive and saturated market. As a result, the company faces high level of competition from major players such as BMW, GM, Toyota, Honda, Chrysler, and Mercedes Benz among others.

When grouped, Ford lie at the lowest group which produces broadest range of cars which affordable prices. The company is a strong brand which is globally known. Its financial capacity and presence has increased its market share. The major weakness of the company is that it highly depends on the U.S market. Financial crisis in Europe and U.S have threatened its performance and market share.

Financially, Ford is stable and in a better position. The company has increased in sales and revenues as well as pre-tax operating profits in a consecutive period of three years. it has been recommended that the company ought to increase its presence in emerging markets and produce diversified products

Canis, Bills and Brent D. Yacobucci. “The U.S. Motor Vehicle Industry: Confronting a New Dynamic in the Global Economy.” Congressional Research Service 26 Mar. 2010: 1-66. Print.

CLLES. Benchmarking Analysis for the Motor Vehicle Industry. Center for Lean Logistics and Engineered Systems. University of North Carolina, 2009. Print.

Bloomberg Businessweek. “Ford Motor Co (F: New York).” Bloomberg Businessweek 6 Dec. 2012: 1. Print.

Ferrell, O C, and Michael D. Hartline. Marketing Strategy . Mason, OH: Thomson South-Western, 2008. Print.

Ford Motor Company. “ Financial Health – Sustainability 2011/12 .” PDF file. 7 Dec. 2012. < https://corporate.ford.com/homepage.html >.

Henry, Anthony. Understanding Strategic Management . Oxford: Oxford University Press, 2008. Print.

Schwed, Joel. Ford: History and Corporate Profile . 12 Dec. 2011. Web. < http://www.valueline.com/Stocks/Highlight.aspx?id=12047 >.

The New York Times. “Ford Motor Company.” The New York Times 30 Oct. 2012: 1. Print.

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Business Ethics

Case: the ford pinto.

• 1.1 Benefits
• 1.3 The End

The Ford P​into

From: Moral Issues in Business 8th ed. Shaw & Barry (pp. 83-86)

There was a time when the “made in Japan” label brought a predictable smirk of superiority to the face of most Americans. The quality of most Japanese products usually was as low as their price. In fact, few imports could match their domestic counterparts, the proud products of Yankee know-how. But by the late 1960s, an invasion of foreign-made goods chiseled a few worry lines into the countenance of the U.S. industry. In Detroit, worry was fast fading to panic as the Japanese, not to mention the Germans, began to gobble up more and more of the subcompact auto market.

Never one to take a back seat to the competition, Ford Motor Company decided to meet the threat from abroad head-on. In 1968, Ford executives decided to produce the Pinto. Known inside the company as “Lee’s car,” after Ford president Lee Iacocca, the Pinto was to weigh no more than 2,000 pounds and cost no more than $2,000.

Eager to have its subcompact ready for the 1971 model year, Ford decided to compress the normal drafting-board-to-showroom time of about three-and-a-half years into two. The compressed schedule meant that any design changes typically made before production-line tooling would have to be made during it.

Before producing the Pinto, Ford crash-tested various prototypes, in part to learn whether they met a safety standard proposed by the National Highway Traffic Safety Administration (NHTSA) to reduce fires from traffic collisions. This standard would have required that by 1972 all new autos be able to withstand a rear-end impact of 20mph without fuel loss, and that by 1973 they be able to withstand an impact of 30 mph. The prototypes all failed the 20-mph test. In 1970 Ford crash-tested the Pinto itself, and the result was the same: ruptured gas tanks and dangerous leaks. The only Pintos to pass the test had been modified in some way–for example, with a rubber bladder in the gas tank or a piece of steel between the tank and the rear bumper.

Thus, Ford knew that the Pinto represented a serious fire hazard when struck from the rear, even in low-speed collisions. Ford officials faced a decision. Should they go ahead with the existing design, thereby meeting the production timetable but possibly jeopardizing consumer safety? Or should they delay production of the Pinto by redesigning the gas tank to make it safer and thus concede another year of subcompact dominance to foreign companies? Ford not only pushed ahead with the original design but stuck to it for the next six years.

What explains Ford’s decision? The evidence suggests that Ford relied, at least in part, on cost-benefit reasoning, which is an analysis in monetary terms of the expected costs and benefits of doing something. There were various ways of making the Pinto’s gas tank safer. Although the estimated price of these safety improvements ranged from only $5 to $8 per vehicle, Ford evidently reasoned that the increased cost outweighed the benefits of a new tank design.

How exactly did Ford reach that conclusion? We don’t know for sure, but an internal report, “Fatalities Associated with Crash-Induced Fuel Leakage and Fires,” reveals the cost-benefit reasoning that the company used in cases like this. This report was not written with the pinto in mind; rather, it concerns fuel leakage in rollover accidents (not rear-end collisions), and its computations applied to all Ford vehicles, not just the Pinto. Nevertheless, it illustrates the type of reasoning that was probably used in the Pinto case.

In the “Fatalities” report, Ford engineers estimated the cost of technical improvements that would prevent gas tanks from leaking in rollover accidents to be $11 per vehicle. The authors go on to discuss various estimates of the number of people killed by fires from car rollovers before settling on the relatively low figure of 180 deaths per year. But given that number, how can the value of those individuals’ lives be gauged? Can a dollars-and-cents figure be assigned to a human being? NHTSA thought so. In 1972, it estimated that society loses $200,725 every time a person is killed in an auto accident (adjusted for inflation, today’s figure would, of course, be considerably higher). It broke down the costs as follows:

Putting the NHTSA figures together with other statistical studies, the Ford report arrives at the following overall assessment of costs and benefits:

Thus, the costs of the suggested safety improvements outweigh their benefits, and the “Fatalities” report accordingly recommends against any improvements–a recommendation that Ford followed.

Likewise in the Pinto case, Ford’s management whatever its exact reasoning, decided to stick with the original design and not upgrade the Pinto’s fuel tank, despite the test results reported by its engineers. Here is the aftermath of Ford’s decision:

• Between 1971 and 1978, the Pinto was responsible for a number of fire-related deaths. Ford puts the figure at 23; its critics say the figure is closer to 500. According to the sworn testimony of Ford engineers, 95 percent of the fatalities would have survived if Ford had located the fuel tank over the axle (as it had done on its Capri automobiles).
• NHTSA finally adopted a 30-mph collision standard in 1976. The pinto then acquired a rupture-proof fuel tank. In 1978 Ford was obliged to recall all 1971-76 Pintos for fuel-tank modifications.
• Between 1971 and 1978, approximately fifty lawsuits were brought against Ford in connection with rear-end accidents in the Pinto. In the Richard Grimshaw case, in addition to awarding over $3 million in compensatory damages to the victims of a Pinto crash, the jury awarded a landmark $125 million in punitive damages against Ford. The judge reduced punitive damages to 3.5 million.
• On August 10, 1978, eighteen-year-old Judy Ulrich, her sixteen-year-old sister Lynn, and their eighteen-year-old cousin Donna, in their 1973 Ford Pinto, were struck from the rear by a van near Elkhart, Indiana. The gas tank of the Pinto exploded on impact. In the fire that resulted, the three teenagers were burned to death. Ford was charged with criminal homicide. The judge in the case advised jurors that Ford should be convicted if it had clearly disregarded the harm that might result from its actions, and that disregard represented a substantial deviation from acceptable standards of conduct. On March 13, 1980, the jury found Ford not guilty of criminal homicide.

For its part, Ford has always denied that the Pinto is unsafe compared with other cars of its type and era. The company also points out that in every model year the Pinto met or surpassed the government’s own standards. But what the company doesn’t say is that successful lobbying by it and its industry associates was responsible for delaying for seven years the adoption of any NHTSA crash standard. Furthermore, Ford’s critics claim that there were more than forty European and Japanese models in the Pinto price and weight range with safer gas-tank position. “Ford made an extremely irresponsible decision,” concludes auto safety expert Byron Bloch, “when they placed such a weak tank in such a ridiculous location in such a soft rear end.”

Has the automobile industry learned a lesson from Ford’s experience with the Pinto? Some observers thought not when, in February 1993, an Atlanta jury held the General Motors Corporation responsible for the death of a Georgia teenager in the fiery crash of one of its pickup trucks. At the trial, General Motors contended in its defense that when a drunk driver struck seventeen-year-old Shannon Moseley’s truck in the side, it was the impact of the high-speed crash that killed Moseley. However, the jury was persuaded that Moseley survived the collision only to be consumed by a fire caused by his truck’s defective fuel-tank design. Finding that the company had known that its “side-saddle” gas tanks which are mounted outside the rails of the truck’s frame, are dangerously prone to rupture, the jury awarded $4.2 million in actual damages and $101 million in punitive damages to Moseley’s parents.

What undoubtedly swayed the jury was the testimony of former GM safety engineer Ronald E. Elwell. Although Elwell had testified in more than fifteen previous cases that the pickups were safe, this time he switched sides and told the jury that the company had known for years that the side-saddle design was defective but had intentionally hidden its knowledge and had not attempted to correct the problem. At the trial, company officials attempted to paint Elwell as a disgruntled employee, but his testimony was supported by videotapes of General Motors’ own crash tests. After the verdict, General Motors said that it still stood behind the safety of its trucks and contended “that a full examination by the National Highway Traffic Safety Administration of the technical issues in this matter will bear out our contention that the 1973-1987 full size pickup trucks do not have a safety related defect.”

Since then, however, the Department of Transportation has determined that GM pickups do pose a fire hazard and that they are more prone than competitors’ pickups to catch fire when struck from the side. Still, GM has rejected requests to recall the pickups and repair them. Meanwhile, the Georgia Court of Appeals has thrown out the jury’s verdict in the Shannon Moseley case on a legal technicality–despite ruling that the evidence submitted in the case showed that GM was aware that the gas tanks were hazardous but did not try to make them safer to save the expenses involved.

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Berkeley Haas Case Series

The Berkeley Haas Case Series is a collection of business case studies created by UC Berkeley faculty

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Disruption in Detroit: Ford, Silicon Valley, and Beyond

Learning objectives.

Pub Date: Dec 31, 2017

Discipline: General Management

Subjects: Innovation, Leadership, Technological change, Technology, General management, Business models, Organizational change, Disruptive innovation

Product #: B5905-PDF-ENG

Industry: Automobiles

Geography: United States, Michigan, California, Silicon Valley, China

Length: 16 page(s)

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The Turnaround at Ford Motor Company

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Amy C. Edmondson

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How Ford Is Thinking About the Future

• Mark W. Johnson

It’s developing a portfolio of new business models.

Dealing with the uncertainty of new, disruptive business models is one of the biggest challenges that faces any large, established company. To gain insight into how to think through these obstacles, the author offers five lessons from Ford’s approach to recent advances in the mobility industry: First, be ambitious with new projects, but don’t over-invest in any one idea. Second, be sure to think not just about the physical functionality of your product, but also about the social and emotional roles it fulfills. Third, constantly examine and update your business model. Fourth, be openminded about creating new rules and metrics for your organization. Finally, to reduce risk, consider building a portfolio of new business models. While there’s no predicting the future, these strategies can position you to take advantage of new opportunities as they emerge.

Everyone’s talking about a future in which vehicles are shared rather than owned, autonomous rather than driven, and where car companies make large shares of their profits on digital “mobility services.” But if you are the Ford Motor Company and face the prospect of investing billions in new technology while your century-old business model is overturned, you might first have a few questions. How are consumers going to react to all of this? What do they really want? How can you tell which opportunities are real and which are science fiction?

• Mark W. Johnson is co-founder and senior partner of the strategy consulting firm Innosight and author of  Lead from the Future   (HBR Press, 2020).

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Ford Case Analysis

Ford Motor Company is an American multinational automaker headquartered in Dearborn, Michigan, a suburb of Detroit. It was founded by Henry Ford and incorporated on June 16, 1903. The company sells automobiles and commercial vehicles under the Ford brand and most luxury cars under the Lincoln brand. Ford also owns Brazilian SUV manufacturer Troller, an 8% stake in Aston Martin of the United Kingdom, and a 49% stake in Jiangling Motors of China. It also has joint-ventures in China (Changan Ford), Taiwan (Ford Lio Ho), Thailand (AutoAlliance Thailand), Turkey (Ford Otosan), and Russia (Ford Sollers). The company is listed on the New York Stock Exchange and is controlled by the Ford family; they have minority ownership but the majority of the voting power.

Ford introduced methods for large-scale manufacturing of cars and large-scale management of an industrial workforce using elaborately engineered manufacturing sequences typified by moving assembly lines; by 1914, these methods were known around the world as Fordism. Ford’s former UK subsidiaries Jaguar and Land Rover, acquired in 1989 and 2000 respectively, were sold to Tata Motors in March 2008. Ford owned the Swedish automaker Volvo from 1999 to 2010. In 2011, Ford discontinued the Mercury brand, under which it had marketed entry-level luxury cars in the United States, Canada, Mexico, and the Middle East since 1938.

Ford is the second-largest U.S.-based automaker (behind General Motors) and the fifth-largest in the world (behind Toyota, VW, Hyundai-Kia and General Motors) based on 2015 vehicle production. At the end of 2010, Ford was the fifth largest automaker in Europe. The company went public in 1956 but the Ford family, through special Class B shares, still retain 40 percent voting rights. During the financial crisis at the beginning of the 21st century, it was close to bankruptcy, but it has since returned to profitability. Ford was the eleventh-ranked overall American-based company in the 2018 Fortune 500 list, based on global revenues in 2017 of $156.7 billion. In 2008, Ford produced 5.532 million automobiles and employed about 213,000 employees at around 90 plants and facilities worldwide.

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Ford Pinto Case Study Shannon Arrighi, Brad Collins, Chasity Mobley, and Tom Tumminelli University of Phoenix Ford Pinto Case Study Shannon—Introduction Faced With The Ethical Dilemma In this ethical dilemma the team agrees it would have been handled differently. Within our group it seems that there would be different opinions of how it would have […]

Ford Pinto Case

Ford Pinto Case John Fraughton Jr. Taylor Gray Brenda Greenwell Christopher Macintyre Leanne Marks University of Phoenix MGT 216 March 17, 2010 Table of Contents Introduction 3 Recommended Solutions and Supporting Information to the Ford Pinto Case 3 Traffic Safety and Accident Data 4 Ethical Opinion 5 Influences from External Social Pressures 5 Case Examined […]

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Case Study: How Ford Motor Co. Got Back on Track

After decades snug in the role of the perennial No. 2 in the U.S. auto industry, Ford Motor Co. suddenly seemed intent on overtaking its longtime rival, General Motors Corp., when Australian Jacques Nasser was named Ford CEO in 1999. An unabashed admirer of General Electric’s “Neutron Jack” Welch, the cocky and confident Nasser billed himself as an agent of change. It was clear he not only wanted to pass the struggling GM in terms of global car sales volume, but also ease Ford’s vulnerability to the recurrent downturns that regularly cripple the auto industry.

Nasser spent billions to acquire brands such as Volvo and Land Rover, and even more on an array of businesses ranging from repairs to recycling. But Nasser, like many top corporate executives in the heady days of the late 1990s, seemed even more enamored with the then-emerging world of “e-“—and put into place a $1 billion Internet strategy that seemed, at times, to lay more emphasis on the Internet than it did on automobiles.

“We’ve entered a world where you measure speed in gigahertz and pipeline bursts, not horsepower,” Nasser declared at the January 2000 North American International Auto Show. Framed by a giant video image of himself, Nasser stood at center stage in Detroit’s cavernous Cobo convention center, surrounded by a quartet of boxy concept vehicles. Dubbed “24.7,” they looked like they’d just rolled out of a Nintendo game. Their plain-vanilla exteriors enveloped high-tech instrument panels featuring an array of telematic technology, including voice-activated navigation, organic LCD video displays and mobile Internet access.

“Go back 100 years, Henry Ford put the world on wheels. Today,” said Nasser, “Ford Motor Company will put the Internet on wheels.”

But the bravado didn’t stop there. A couple of days later, Nasser announced the launch of Ford’s Wingcast telematics unit—which would allow consumers to use their cars as Net portals, ready to tap into the information superhighway from the road. Nasser also formed joint ventures with an array of high-tech partners ranging from Qualcomm Inc. to Yahoo!, and even announced plans—with Yahoo! founder Jerry Yang at his side—to give every Ford employee a computer and Internet access.

In addition, Ford, its stock price at an all-time high of nearly $64 a share, and its already fat profits looking to grow even larger with the spoils of the New Economy, took to the Web with a passion. It helped found the B2B auction site, Covisint, with crosstown rivals General Motors and DaimlerChrysler. It also moved aggressively to begin retailing its cars online, and boldly moved to sell factory-direct to consumers, bypassing dealers and their hefty markups.

Accelerate to the present. What once seemed so inevitable has taken on the ring of futility. Ford dissolved the Wingcast venture last June and has curtailed the computer giveaway. The Yahoo! partnership has quietly expired, while its standalone ConsumerConnect unit—the figurehead of its old aggressive, five-prong Internet sales strategy—has been downsized and absorbed into Ford’s traditional marketing groups.

And after running afoul of state franchising laws and angry retailers, the automaker has handed its online retailing operation over to dealers—though Ford insists the Web is paying off handsomely with sales leads it wouldn’t be getting otherwise.

Meanwhile, Ford’s stock price is stuck in low gear, averaging around $9 in recent months. Its market share is sliding, from 23.2 percent to 21.5 in 2002. Earnings are also depressed, with worldwide automotive operations reporting a third-quarter loss of $243 million, compared with a loss of $877 million for the same period in 2001. True, the red ink is diminishing, but at press time, Ford’s 2002 earnings were expected to fall way short of Wall Street expectations. Embarrassing vehicle recalls, meanwhile, have tarnished an image honed by years of advertising that “Quality is Job One,” and the company is eliminating thousands of jobs and shuttering five factories to get costs back in line.

Indeed, things are not going quite as planned for the automaker as it approaches the celebration of its 100-year anniversary on June 16. With CEO Bill Ford, the first Ford family heir at the helm in more than two decades, the automaker has launched a “back to basics” campaign designed to help it regain its footing.

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How Ford Adapted To The Changing Automobile Market

Table of contents.

Over its 118 year history, the Ford Motor Company has led the way in innovative technologies and leading business practices. 

Important stats to know about The Ford Motor Company: 

• Controls 13.9% of the US automotive market share in 2022
• Revenue of $136.3B in 2022  
• Headquartered in Dearborn, Michigan
• Produces over 4 million vehicles each year
• Employs over 182,790 employees around the world
• Ranked #21 in the Fortune 500
• Market value of $54.51 Billion as of Feb, 2023

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The History of The Ford Motor Company

Henry ford’s vision.

The Ford Motor Company has a long history that was inspired by Henry Ford, an Irish immigrant to the United States. Ford realized that the world’s transportation needs were quickly changing at the turn of the 20th century. His first attempt to design and build an automobile was in 1896 when he created his first vehicle — the quadricycle. The vehicle had a simple design with a bench seat for two passengers, a four-horsepower engine, bicycle wheels, and a gearbox with two speeds (but no reverse). 

Henry Ford on his “quadricycle” 

In November of 1901, Henry Ford joined the Detroit Automobile Company, a car manufacturing company, but his time there was short-lived. He left the company the following year. This company went on to become the Cadillac Motor Company (which was later purchased by General Motors). 

The Ford Motor Company was founded in 1903 when Henry Ford used $28,000 of investor money (about $800,000 in today’s money) to open a manufacturing facility. One of the early investors was John and Horace Dodge who would go on to create their own car manufacturing company. Because investors feared that Ford would leave the company like he did the Detroit Automobile Company, a local banker, John S. Gray was chosen as the first president. 

Leadership under the Ford family

Henry Ford did eventually become president and controlling owner of the company in 1906. Ford was directly responsible for the early success of the company including the popular Model T and innovative assembly line processes. He held this position until 1919 when his son, Edsel Ford, took over as company president. 

Edsel Ford was an artist and led the company to change the design of cars from practicality to visually appealing. The newly designed Ford vehicles were a hit with consumers all over the world. Edsel Ford died in 1943 and Henry Ford took back over as president of the company since Edsel was his only son.

Two years later, Edsel’s son, Henry Ford II took over as president and served from 1945 to 1960. The company had grown exponentially prior to his leadership. Henry Ford II worked diligently to solve many problems that plagued the organization. The bookkeeping was a mess and work processes needed to be heavily refined. Henry Ford II took it upon himself to transform the company into the polished and disciplined brand that it is today. 

Going public on the New York Stock Exchange

After a long run as a private (and mostly family-owned company), the Ford Motor Company went public in 1956. Traded under the NYSE stock ticker “F”, the IPO (initial public offering) for Ford was the largest IPO in history at the time ( $657 million worth of stock sold - $28.5 billion in today’s dollars ). 

Early competition

In the early years, the Ford Motor Company had a lot of competition. In fact, in 1920, there were approximately 200 car manufacturers in the United States . The largest companies that Ford was up against included General Motors and Chrysler. General Motors had many brands that proved formidable competitors including Chevrolet, Buick, and Cadillac. While the competition remained fierce, many of the early car manufacturers went out of business. By 1940, only 17 car manufactures remained. 

Becoming an International Brand

The Ford Motor Company owes much of its success to its expansion into international markets. The company was quick to do this shortly after its inception. The first international manufacturing facility was opened in Walkerville (now Windsor), Ontario in 1904. This was built directly across the Detroit River from Ford’s other manufacturing facilities at the time. The Ford Motor Company of Canada was established as a separate company with its own shareholders with the mission to sell Ford vehicles in Canada and other parts of the British Empire.

By 1908, Ford opened its first sales office outside of North America in Paris, France. Shortly after, Ford opened assembly plants across Europe between the years 1917 and 1925 in Ireland, England, France, Denmark, Germany, and Austria. In 1924 and 1925, Ford expanded into South America (Argentina), Asia (Japan), Africa (South Africa), and Australia. 

In 1929, the Ford Motor Company was contracted to set up the Gorky Automobile Plant in Russia which produced the Model A and AA. This helped to further industrialize the country. 

Key takeaways

• The Ford Motor Company’s early success was a result of Henry Ford’s mission to improve the automobile by creating a more durable and accessible version for the Average consumer. 
• For 50 years, the Ford family led the company with each new CEO bringing fresh new ideas. This led to innovation that helped Ford outpace the competition. 
• Early expansion into international markets helped accelerate Ford into an international brand with access to consumers all over the world. 

Cultural and Industry Impacts of the Ford Motor Company

The ford assembly line and manufacturing methods.

One of the most impactful reasons for Ford’s early success was the way they manufactured their vehicles. In the early years, the Ford factory produced a handful of cars each day by assigning 2-3 men to work on a car at a time. The car was built from start to finish. This was the normal manufacturing process of other car companies at the time. 

By 1913, Henry Ford created a new approach to manufacturing by introducing the first moving automobile assembly line where cars would move down the assembly line. Workers would be assigned one or two steps that they would perform over and over. This helped workers become better at their assigned tasks. Cars were produced at a much faster pace. This reduced the production time from 12.5 hours for a Model T to just 1.5 hours. With decreased production times, this new method drove down the cost making cars even more accessible for the average American. 

The moving assembly line isn’t the only manufacturing innovation that the Ford Motor Company has developed. In 1986, the Ford Motor Company introduced automated assembly for some subassembly tasks using robots. This process was initially tested in Ford’s St Louis facility and was a major success. This type of manufacturing is now used at most Ford plants today. 

Shaping the American workforce

The Ford Motor Company has a long history of embracing industry-leading policies in relation to its workforce. Henry Ford understood that in order to remain competitive and producing cutting-edge technology, the company needed to employ the best and the brightest. The monotonous and strenuous work of the moving assembly line created new problems for Ford with an increase in high turnover. 

In 1914, Ford responded by making a move that shocked the public and landed him on the front page of newspapers all over the country. The Ford Motor Company instituted a $5 workday doubling the existing rate of pay of assembly line workers. In addition, Ford reduced the workday from nine to eight hours allowing for the plant to run three equal length shifts (prior to that, the facility only ran two shifts). 

The most significant impact of this change was that the average assembly line worker at Ford could afford to purchase an automobile for their own families. The increased mobility, wages, and leisure time inspired a movement across the country. Many other companies began to follow suit giving the Ford Motor Company credit for the creation of the American middle class.

After the World Wars, the Ford Motor Company made significant efforts to employ many of the veterans who had returned home with disabilities. This move made the Ford Motor Company one of the first to hire workers with physical disabilities. At the time, most companies only hired able-bodied workers. Instead, Ford took a different approach. They not only hired these workers but created work environments that were modified to accommodate those with special needs. 

In 1941, Ford signed a contract with the UAW-CIO (United Auto Workers-Congress of Industrial Organizations) labor union. This contract helped drive better pay, benefits, and working conditions for Ford employees. 

Ford’s impact on the airline industry

Henry Ford understood that the transportation industry wouldn’t just expand on the ground. He recognized that air travel would become commonplace in the modern world. In 1925, the Ford Motor Company created its own airplane design. Between 1925 and 1933, the company manufactured and sold nearly 200 Ford Tri-Motor airplanes (nicknamed the Tin Goose). This model of plane was used by early commercial airlines in the United States. 

To help encourage further development of the industry, the Ford Motor Company provided 35 of the plane’s patents royalty-free including its navigation system (the navigational radio beam). This allowed other companies in the space to further develop aviation technology. 

Supporting the United States during the World Wars

Automobile manufacturing plants were easy to convert into facilities to produce other types of vehicles. In 1918, Ford’s River Rouge Complex began producing anti-submarine patrol boats, cars, ambulances, trucks, tractors, tanks, and airplane engines that would be supplied to Allied troops. As the war came to an end, Ford moved production back to civilian vehicles. 

Unfortunately, peace only lasted a couple of decades. As tensions began to churn again in the early 1940s, the US government began ordering jeeps from the Ford Motor Company. The word “jeep” came from the acronym “GP” which stood for “General Purpose”. 

By 1942, Ford once again halted civilian production of automobiles to support the war effort of World War II. The Ford Motor Company worked with Charles Lindberg, the infamous trans-Atlantic pilot, on the construction of more than 8,000 B-24 Liberator bombers.

In 1944, Rose Will Monroe was working as a rivet gun operator at Ford’s Willow Run facility. She was chosen to serve as the icon to promote the sale of bonds to support the war effort. Her fictional character “Rosie the Riveter” was featured on the iconic “We Can Do It!” posters all across the country. The campaign was a success and is noted as one of the most iconic images from the era.

• Ford’s creation of the first moving automobile assembly line sped up production allowing the Ford Motor Company to produce significantly more vehicles at a lower cost than their competitors. 
• The Ford Motor Company gained a competitive advantage by increasing wages, reducing hours, and improving working conditions. This helped them secure the best talent and improved employee morale and productivity. 
• The Ford Motor Company helped stimulate growth in industries that would purchase Ford products by investing in the development of new technologies. For example, Ford provided free patents to early airlines in hopes they would purchase Ford-built planes.
• Ford produced hundreds of vehicles to support the United States during World War I and II. The government contracts were not only profitable, but Ford became recognized for their support. The war also helped expose the global market to Ford-manufactured vehicles. 

Evolution of Popular Ford Models

The Ford Motor Company has had many major successes in its development of popular, cutting-edge vehicles over its nearly 120-year history. Some of these models have consistently held records for their high sales numbers and groundbreaking innovations. 

• Model T (1908) - The Model T was one of the most successful models released by Ford and demonstrated his vision to make automobile transportation accessible to the average person. Prior to the Model T, most automobiles were considered luxury items. The design was intended to drive down costs. Between 1908 and 1927, Ford sold over 15 million Model T’s. The other challenge that the Model T solved was its durability and easy maintenance. Most other automobiles at the time couldn’t handle the many miles of rough, unpaved roadways. The Model T solved for this using vanadium steel alloy for some of its parts so they would be more durable. 

• Model A (1927) - Ford continued to sell the Model T successfully for 18 years. However, other car manufactures soon caught on to Ford’s manufacturing process and started gaining market share. This pressure from other car manufacturers forced the Ford Motor Company to rethink their design of the Model T. This led to the creation of the Model A. Henry Ford assigned his son, Edsel, to take charge of developing the sleek new design. The Model A was equipped with innovative features like a Safety Glass windshield, industry-standard driver controls, and a fuel gauge. The Model A was produced around the world in plants in Argentina, Canada, Denmark, France, Germany, Italy, Japan, and the United Kingdom. Despite the economic challenges of the Great Depression, Ford sold 5 million Model A’s before it was discontinued in 1931. 

• F-Series Pickup Trucks (1948) - During World War II, the Ford Motor Company created a variety of military trucks. Ford recognized that these vehicles which were used to haul supplies to troops all over Europe had a civilian application as well. So in 1948, the company unveiled a new line of trucks. Earlier truck models were simply built on car platforms. This new line would be built on a chassis that was specially designed for heavy hauling. The original line came in eight sizes and weight ratings from the F-1 (0.5-ton capacity) up to the F-8 (3-ton capacity). This gave consumers the option to pick the right truck for their needs. The F-series naming was updated in 1953 to F-100, F-250, and F-350. These trucks remain extremely popular today. Over the last 40 years, the F-series has remained the best-selling vehicle in the United States. 
• Thunderbird (1954) - The Ford Thunderbird was introduced as a direct response to the Chevrolet Corvette. The car featured a sleek design that was very popular, but instead of focusing on power and speed like the Corvette and other European sports cars, they focused on driver comfort. This strategy paid off. Ford sold nearly 25x the number of Thunderbirds than Chevy sold Corvettes. (16,155 Thunderbirds compared to only 674 Corvettes).

• Mustang (1964) - In the 1960s, Ford Vice President, Lee Iacocca, wanted to create a new model targeted at younger drivers who wanted a sporty look but didn’t want to spend a fortune. Developed on a shoestring budget, the Ford Mustang was introduced in 1964 and quickly became an American cultural icon and was featured in movies and songs. Within a few short years, the Mustang became one of the fastest-selling vehicles in history and is still produced today. 

• Fiesta (1976) - The first internationally successful model was the Ford Fiesta. In the 1970s, the oil crisis led to a demand for fuel-efficient cars. Car manufacturers all over Europe began introducing compact model cars including the Fiat 127, Renault 5, and BMC Mini. The company spent $870 million developing the model which was the largest development budget in the company’s history at the time. In the first year of sales, the Fiesta broke the sales record that the 1965 Mustang had set. 
• Escort (1980) - The Ford Escort was originally designed as a small family car in Europe in 1968. It became widely popular especially in the United Kingdom where it was the best-selling car during the 1980s and 1990s. It wasn’t until 1980 that Ford brought the Escort to North America when the company needed a quick replacement for the Ford Pinto. The Pinto had a fuel tank design flaw that led to the death of a few hundred people and created a public relations nightmare for the company.
• Explorer (1990) - In the early 1990s, the Ford Motor Company recognized a growing interest in a new type of passenger vehicle — the Sport Utility Vehicle (SUV). They set out to design their own SUV which became the Ford Explorer. The Explorer became the catalyst for the SUV market and other manufacturers soon followed suit. By the late 1990s, SUV sales exceeded that of regular passenger cars. 

• The Ford Motor Company was able to create many popular vehicle models by paying close attention to what their competitors were doing and what their customers wanted. 
• Ford designed and introduced many variations of its models based on the local tastes and demands of each international market.

Introduction and Acquisition of New Brands

Lincoln motor company.

Lincoln Motor Company was created in 1917 as a luxury car manufacturer. The Ford Motor Company began feeling the pressure of competition from luxury brands like Cadillac and Packard. In September of 1922, Ford purchased the Lincoln Motor Company for $8 million (over $123 million today). Today, Lincoln focuses on a small number of models of luxury full-size sedans and SUVs.

The flagship automobile of Lincoln, the Continental was extremely popular throughout the history of the company. It has been reintroduced and discontinued several times, most recently from 2017 to 2020. 

In 1939, under the direction of Edsel Ford, the Ford Motor Company created the Mercury brand. This was intended to compete with General Motors who produced several mid-priced vehicles including Pontiac, Oldsmobile, and Buick. Mercury was the perfect solution to bridge the gap between the affordable Ford brand and high-end Lincoln cars. 

In 2011, after 82 years of operation, Ford announced the decision to end the production of Mercury vehicles. The company decided to put more focus on the Ford and Lincoln brands. 

The Ford Motor Company has been very successful in many of its ventures. However, the Edsel brand turned out to be a costly disaster. Created in 1956 to help the company gain market share from Chrysler and General Motors, Edsel was hyped as the “car of the future”. Despite millions of dollars poured into fancy marketing campaigns, the final product left much to be desired for the consumer. 

There were numerous complaints about the cars being unattractive and having poor quality craftsmanship. One example was the Teletouch transmission selector, which was a series of buttons placed at the center of the steering wheel to change gears. This odd placement confused drivers and was difficult to operate. In order to move the transmission from park to drive, the operator had to shift from park, to reverse, to neutral, and then drive. The transmission motor also didn’t work well on hills requiring drivers to use the parking brake instead of putting the vehicle in park. 

A scathing article published in a 1958 edition of Popular Mechanics highlighted many of the issues that drivers were reporting including poor welding, power steering failure, a leaking trunk, and a faulty odometer. 

After taking a loss of $250 million ($2.2 billion today), the Ford Motor Company chose to discontinue the brand after only three years in 1959. 

Rivian is an American electric vehicle manufacturer founded in 2009. With the rise of electric vehicles, the Ford Motor Company made a brief investment of $500 million into the brand in 2019. However, due to the COVID-19 pandemic, the company decided to terminate the contract. They have decided to maintain their relationship with Rivian for future potential partnerships, but in the meantime, have shifted those resources to the Lincoln Motors brand. 

• Ford faced many pressures from other automotive companies. They purchased and created new automotive brands like Lincoln and Mercury to give them a wider range of options for their customers.
• Not every new brand was a success. The Edsel brand cost the company millions of dollars and damaged its reputation. 

Innovations Led by The Ford Motor Company

The Ford Motor Company had a hand in creating many new products and innovations throughout its history. In addition to new technologies, Ford also played a part in the creation of new industries and historic events such as the moon landing. The Ford Motor Company created its own scientific laboratory in Dearborn, Michigan in 1951 to perform experiments and research for technology and scientific breakthroughs that could be used both inside and outside the automobile industry. 

In 1932, Ford created the first commercially successful V8 engine. This was a hit as American’s became more interested in automobiles with powerful engines. This engine is still popular today with hot rod enthusiasts. 

Early automobiles had a reputation for being unsafe. Ford recognized this and decided to put a focus on reducing automobile accidents and injuries to help change consumer perception. In 1954, the company began performing crash tests to measure the effectiveness of designs and safety features. Since then, Ford has performed more than 31,000 crash tests around the world. In recent years, Ford has begun using computer-simulated tests in tandem with physical crash tests. This has significantly improved the company’s data and insight on safety testing. 

From 1961 to 1974, Ford owned Philco, a consumer electronics company. Philco was responsible for designing, building, and equipping NASA’s mission control during the Apollo and Gemini space programs. The company also launched a series of communications satellites, many of which still provide data and telecommunications access today. 

In 1970, Ford introduced the three-point, self-adjusting lap, and shoulder seat belts into its vehicles as a standard safety feature. 

• The Ford Motor Company has spent a considerable amount of money on new technology to help it stay competitive. 
• The company wisely chose to focus on developing technology in general and not just the automobile industry. This allowed the company to expand beyond its expertise into industries like aerospace. 

Ford’s Corporate Strategy

The 21st Century has posed many challenges for the Ford Motor Company including the 2008 financial crisis and the COVID-19 pandemic, to name a few. The Ford Motor Company unveiled a new strategic plan at the end of 2020 (called “The Plan”) that will revitalize the company by modernizing how it operates, simplifying processes, and exploring new opportunities for growth. 

Electric vehicles

Ford Motor Company's strategy to embrace electric vehicles (EVs) is a core component of its commitment to achieving carbon neutrality by 2050 and aligns with the Paris Climate Agreement's goals. With an enhanced investment commitment of $22 billion through 2025, Ford is expanding its electric lineup to include not only innovative new models but also electrified versions of its iconic vehicles. This includes the Mustang Mach-E, which combines the marque's legendary performance with electric efficiency, and the F-150 Lightning, an electric iteration of America's best-selling truck, reflecting Ford's ambition to meet diverse consumer needs.

Additionally, the electric Ford Focus represents Ford's foray into the compact car segment with electric power, offering a sustainable, efficient option for city driving and daily commutes. Through these efforts, Ford is actively contributing to the global shift towards sustainable transportation, demonstrating its leadership in the automotive industry's transition to electric mobility.

Sustainability

From a sustainability standpoint, the company wants to tackle an impressive list of environmentally friendly milestones. Its mission is to contribute to 11 of the United Nations’ Sustainable Development Goals (UN SDGs). These goals include moving all manufacturing to renewable energy by the year 2035, replacing all plastic vehicle parts with 100% recycled materials, and eliminating all single-use plastics from its manufacturing process. 

Enhanced safety

The Ford Motor Company is dedicated to making its automobiles safer than ever before. With the development of new safety features and self-driving technology, the company wants to create a world that is free from vehicle accidents and workplace injuries. 

• In 2020, the Ford Motor Company unveiled a new plan to revitalize the company as the world economy comes out of the COVID-19 pandemic. 
• The strategic plan focuses on creating a sustainable line of vehicles through the development of new electric cars, trucks, and vans. 
• The company looks to meet sustainability goals set forth by the United Nations and the Paris Climate Agreement. 
• Ford also wants to place a focus on improving automotive safety.

Ford’s Impact of Racing and Motorsports

The Ford Motor Company has a long history of being a part of racing culture since its beginnings. Even before the company was founded, Henry Ford successfully reached a top speed of 20 miles per hour in his quadricycle. In the years following, Ford also won several races and set speed records with his personally designed Ford 999. 

In 1966, Ford captured the world’s attention when three Ford GT40 MK II’s crossed the finish line at the 24-hour Le Man’s race taking first, second, and third place. Not only did this make Ford the first American car manufacturer to win the title, but they also broke Ferrari’s six-year winning streak. Ford went on to take first place in 1967, 1968, and 1969. 

For over 80 years, Ford has been represented in NASCAR races. The first win came in 1949 when Jim Roper won a race in Charlotte in a Lincoln. The following year Jimmy Florian won the first race in a Ford vehicle at Dayton Speedway in Ohio. Since then, Ford-built cars have won more than 800 NASCAR races, second only to Chevrolet. 

In addition to Le Mans and NASCAR, Ford has drivers participating in many other events and races including Formula 1 and the World Rally races. 

For a car manufacturer, being able to demonstrate your vehicle’s performance on a racetrack helps to signify the brand as a well-engineered machine. The more races won in a Ford brand vehicle, the more notoriety the company receives. Key races like the 1966 win at Le Mans are a great way to capture the attention of car enthusiasts everywhere. 

• The Ford Motor Company has used racing throughout its history to demonstrate the power and quality of Ford vehicles. 
• The investment put into developing race cars like the Ford GT have helped Ford capture historic wins that provide exponentially more value from advertising and positive PR. 

Recovery from the Brink of Financial Ruin

Despite having over 100 years of success, the Ford Motor Company hit a rough patch in 2006 and was in a dismal state. The company was on track to take a loss of $17 billion due to falling sales. This forced plant closures and massive layoffs which resulted in Ford buying out 38,000 unionized workers. The Ford Motor Company needed cash but couldn’t get additional financing due to receiving a “junk” bond status. To remain solvent, the company had to mortgage its assets to raise cash. Share prices had plummeted from an all-time high of about $35 in 1999 to $8 in 2006. 

The CEO at the time was Bill Ford, the great-grandson of Henry Ford. He recognized that the company needed a new leader. In a bold move that shocked the industry, Bill Ford convinced the company board to appoint Alan Mulally as President and CEO of Ford Motor Company. Alan Mulally knew very little about the automotive industry. He began his career as an aerospace engineer at Boeing in 1969. Over his 37 years at Boeing, he rose to the position of president of Boeing Commercial Airplanes (a subsidiary of The Boeing Company). He was known for helping to save Boeing from bankruptcy after financial trouble in the late 90s and early 2000s. Bill Ford felt confident that Alan Mulally could do the same for Ford. 

Mulally quickly identified that there were some underlying issues that were resulting in Ford’s stunted performance including a lack of transparency, bad leadership, and a stagnant product line. He openly admitted to the organization that he didn’t have automotive expertise. This helped to drive a culture of more transparency within the Ford Motor Company. Rather than hiding behind inexperience, challenges, or failures, the team began speaking up when they needed help or additional support. 

Mulally also introduced a new approach to meetings. When arriving at Ford, he quickly realized that there were lots of pointless meetings where many topics and issues were discussed but resulted in no action. The normal Ford meetings were replaced with BPR (Business Plan Review) meetings in which leaders would present their 4-5 top priorities with a green, yellow, or red status. This helped the team quickly identify what areas needed the most attention. 

When Mulally announced his plan to the board of directors, he committed to focusing on four major objectives: 

• Aggressively restructure the organization to operate profitably at the current market demand.
• Accelerate the development of new products based on customer wants and needs. 
• Finance the plan and improve the balance sheet.
• Work together effectively as one team. 

The strategy was extremely successful. Not only was Mulally able to turn the company around, but they also avoided needing the taxpayer bailouts that General Motors and Chrysler needed during the 2007-2008 financial crisis. This was a huge feat and boosted public confidence in the company.

• Ford leadership was able to quickly recognize the need for a new CEO to help redirect the company in 2006 when sales began declining sharply resulting in major losses. 
• Bill Ford, the great-grandson of Henry Ford, convinced the board of directors to hire a man with no experience in the industry, Alan Mulally. He understood that experience leading an organization through tough financial times was more important than technical knowledge.
• Mulally’s success was a result of driving a culture change at Ford Motor Company that increased transparency and eliminated counterproductive attitudes and behavior. 

Final Thoughts and Key Takeaways

The Ford Motor Company is a true innovator in the automotive space. Aside from General Motors, no other car manufacturer has seen the levels of growth that Ford has achieved. Much of the success comes from the brilliant leadership of the Ford family that ran the company for over 50 years. Even through tough times, the company has found ways to grow and adapt. Their dedication to being the best helped make Ford the iconic American brand it is today.

 Recap: growth by the numbers

• The Ford Motor Company thrived under the Ford family leadership for over 50 years. Each Ford president (Henry Ford, Edsel Ford, and Henry Ford II) brought new ideas and perspectives that helped the company adapt to changes in the market and competition.
• One of Henry Ford’s greatest successes was the development and refinement of the moving assembly line process. This significantly increased productivity, improved quality, and decreased production costs.
• Few brands have shaped American culture like Ford. The Ford Motor Company is credited with the creation of the American middle class by offering competitive salaries and reduced working hours.
• Ford has created many ground-breaking and popular models including the Model T, Mustang, F-series pickup truck, and Thunderbird. They have been successful at staying ahead of most market trends and consumer demands.
• The Ford Motor Company has been able to grow by not only developing the Ford brand but also building and acquiring additional brands like Lincoln and Mercury to compete in the luxury and mid-price markets.
• Ford ramped up its international reach quickly between 1917 and 1925. Within a few short years, the company was selling cars on every continent.
• The Ford Motor Company has been an innovator both inside and outside the automotive space. They have been dedicated to many forms of scientific and technological research including automotive safety, aerospace, and clean energy.
• In 2020, the Ford Motor Company announced their new corporate strategy – The Plan. The goal is to revitalize and grow the company as it recovers from the challenges of the 21st century including the 2008 financial crisis and the COVID-19 pandemic. The Plan focuses on converting its vehicle line to electric vehicles, tackling environmental objectives, and focusing on enhancing automotive safety.
• As an automotive manufacturer, Ford has a long history of involvement in racing and motorsports around the world. It’s most famous for its wins at Le Mans in the 1960s and success in the NASCAR series. 

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Case study: How Ford promotes a culture of compliance and ethics across its operations

Operating in over 100 countries and employing 201,287 people in 71 facilities across the globe, Ford tries to gain the trust of key stakeholder groups by operating responsibly and transparently     Tweet This! , with compliance and ethics as a solid foundation for the company’s business practices and activities.

This case study is based on the 2016/17 Sustainability Report by Ford  that can be found at this link . Through all case studies we aim to demonstrate what CSR/ sustainability reporting done responsibly means. Essentially, it means: a) identifying a company’s most important impacts on the environment, economy and society, and b) measuring, managing and changing.

Making sure ethical business practices are implemented across the company’s operations worldwide is a key priority for Ford, in trying to be a good corporate citizen. In order to promote a culture of compliance and ethics across its operations Ford took action to:

• provide ethics advice
• offer ethics and compliance training
• encourage the reporting of violations
• fight bribery and corruption

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• Which are the most important impacts (material issues) Ford has identified;
• How Ford proceeded with stakeholder engagement , and
• What actions were taken by Ford to promote a culture of compliance and ethics across its operations

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What are the material issues the company has identified?

In its 2016/17 Sustainability Report Ford identified a range of material issues, such as product carbon footprint and fuel economy, customer satisfaction, product quality and safety, supply chain management, assessment, capacity building and performance, government regulation and policy. Among these, promoting a culture of compliance and ethics across its operations stands out as a key material issue for Ford.

Stakeholder engagement in accordance with the GRI Standards

The Global Reporting Initiative (GRI) defines the Principle of Stakeholder Inclusiveness when identifying material issues (or a company’s most important impacts) as follows:

“The organization should identify its stakeholders, and explain how it has responded to their reasonable expectations.”

Stakeholders must be consulted in the process of identifying a company’s most important impacts and their reasonable expectations and interests must be taken into account. This is an important cornerstone for CSR / sustainability reporting done responsibly.

Key stakeholder groups Ford engages with:   

How stakeholder engagement was made to identify material issues

To prioritize material topics and identify key challenges and opportunities, Ford conducted interviews with both internal and external stakeholders, who were additionlly asked to rate issues according to importance.

What actions were taken by Ford to promote a culture of compliance and ethics across its operations?

In its 2016/17 Sustainability Report Ford reports that it took the following actions for promoting a culture of compliance and ethics across its operations:

• Providing ethics advice
• Ford’s Corporate Compliance Office has developed various tools to provide employees with key compliance information. These tools include The Right Way, a free mobile application available in seven languages. The Right Way covers topics such as human rights, harassment and discrimination, human trafficking, bribery and corruption.
• Offering ethics and compliance training
• Mandatory online training courses are provided by Ford to non-manufacturing employees and other key personally globally. These courses focus on a number of issues, including the protection of personal and company information, bribery and corruption, conflicts of interest, and the company’s ethical culture.
• Encouraging the reporting of violations

• Fighting bribery and corruption
• implements clear bribery and corruption policies, as well as procedures for reporting breaches of law or policy
• strengthened the anti-bribery and anti-corruption components of its Global Terms & Conditions (and of other contracts) for the company’s suppliers
• provides training to individuals who may come across bribery or corruption issues at work
• assesses all operations for bribery and corruption risks

Which GRI Standards have been addressed?

The GRI Standards addressed in this case are:

1) Disclosure 102-16 Values, principles, standards, and norms of behavior

2) Disclosure 102-17 Mechanisms for advice and concerns about ethics

3) Disclosure 205-2 Communication and training about anti-corruption policies and procedures

78% of the world’s 250 largest companies report in accordance with the GRI Standards

SustainCase was primarily created to demonstrate, through case studies, the importance of dealing with a company’s most important impacts in a structured way, with use of the GRI Standards. To show how today’s best-run companies are achieving economic, social and environmental success – and how you can too.

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References:

1) This case study is based on published information by Ford, located at the link below. For the sake of readability, we did not use brackets or ellipses. However, we made sure that the extra or missing words did not change the report’s meaning. If you would like to quote these written sources from the original, please revert to the original at the link:

http://corporate.ford.com/content/dam/corporate/en/company/2016-17-sustainability-report/Sustainability-Report-16-17.pdf

2) http://www.fbrh.co.uk/en/global-reporting-initiative-gri-g4-guidelines-download-page

3) https://g4.globalreporting.org/Pages/default.aspx

4) https://www.globalre porting.org/standards/gri-standards-download-center/

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Henry Ford: A Case Study of an Innovator

9 artifacts in this set

1896 Ford Quadricycle Runabout, First Car Built by Henry Ford

Learn more about how the Quadricycle fits into the story of Henry Ford as an innovator by reading From the Curators: Henry Ford and Innovation, available at http://www.thehenryford.org/education/erb/HenryFordAndInnovation.pdf

Henry Ford and Ed (Spider) Huff Driving the Ford Sweepstakes Racer at Grosse Pointe, Michigan, October 10, 1901

Photographic print

Learn more about how auto racing fits into the story of Henry Ford as an innovator by reading From the Curators: Henry Ford and Innovation, available at http://www.thehenryford.org/education/erb/HenryFordAndInnovation.pdf

1903 Ford Model A Runabout

Learn more about how the Model A fits into the story of Henry Ford as an innovator by reading From the Curators: Henry Ford and Innovation, available at http://www.thehenryford.org/education/erb/HenryFordAndInnovation.pdf

1914 Ford Model T Touring Car, Given to John Burroughs by Henry Ford

Learn more about how the Model T fits into the story of Henry Ford as an innovator by reading From the Curators: Henry Ford and Innovation, available at http://www.thehenryford.org/education/erb/HenryFordAndInnovation.pdf

Ford Motor Company Executives in Superintendent's Office at Highland Park Plant, 1914

Learn more about how the team of engineers and executive fits into the story of Henry Ford as an innovator by reading From the Curators: Henry Ford and Innovation, available at http://www.thehenryford.org/education/erb/HenryFordAndInnovation.pdf

Newspaper Article, "Gold Rush is Started by Ford's $5 Offer," January 7, 1914

Learn more about how the $5 Day fits into the story of Henry Ford as an innovator by reading From the Curators: Henry Ford and Innovation, available at http://www.thehenryford.org/education/erb/HenryFordAndInnovation.pdf

Advertisement for the 1924 Ford Model T, "Freedom for the Woman Who Owns a Ford"

Advertisement

Learn more about how advertising fits into the story of Henry Ford as an innovator by reading From the Curators: Henry Ford and Innovation, available at http://www.thehenryford.org/education/erb/HenryFordAndInnovation.pdf

Ford Rouge Plant Pictorial Flow Chart, "Complete Car Can Be Built in 28 Hours," 1940

Learn more about how the Rouge fits into the story of Henry Ford as an innovator by reading From the Curators: Henry Ford and Innovation, available at http://www.thehenryford.org/education/erb/HenryFordAndInnovation.pdf

Henry Ford with the First Ford V-8 Engine, March 26, 1932

Learn more about how the V-8 fits into the story of Henry Ford as an innovator by reading From the Curators: Henry Ford and Innovation, available at http://www.thehenryford.org/education/erb/HenryFordAndInnovation.pdf

This is user-generated content and does not reflect the views of The Henry Ford.

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Ford Motor Company’s Culture: An Analysis

Ford Motor Company’s organizational culture influences the firm’s drive toward higher performance to achieve its vision of industry leadership. A company’s work culture defines the values, customs, and traditions that affect individual and group behaviors. Ford uses its corporate culture to maintain a high-performance workforce. As one of the biggest players in the global automobile market, the company needs to maintain high productivity and effective support for technological and process innovation. These needs are met through an organizational culture that embodies Ford’s mission statement and vision statement , with emphasis on work excellence, teamwork, and goals for industry leadership and higher business performance.

Ford’s organizational culture provides a social environment that motivates personnel to achieve business goals for the company’s success. This factor shows that the business culture contributes to competitive advantages over other automakers, such as Tesla , General Motors , Toyota , and Honda. These competitors maintain innovation capabilities and a strong market presence, which imposes significant challenges in the industry, as demonstrated in the Five Forces analysis of Ford Motor Company . The automotive company’s work culture promotes human resource development to help counteract the effects of competition.

Features of Ford’s Organizational Culture

Ford’s culture is a result of organizational changes based on the company’s One Ford plan. The goal of this plan and the corresponding company culture is to unify its global organization to achieve consistency and a successful collaborative environment for the automotive business. Such a work culture continues to this day. The following are the main characteristics of Ford’s organizational culture:

• F – Foster functional and technical excellence
• O – Own working together
• R – Role model Ford values
• D – Deliver results

Foster Functional and Technical Excellence. Ford Motor Company emphasizes excellence in its organizational culture to support innovation, such as in vehicle design and production. The firm recognizes the importance of excellence to push its performance higher. The car business has training programs to support this characteristic of its corporate culture. Employees are encouraged to learn, improve, and contribute ideas for organizational development. This feature of the business culture supports Ford’s generic strategy for competitive advantage and intensive strategies for growth . Excellence through the company culture motivates workers to make the business organization more competitive in the automobile market.

Own Working Together. Teamwork is among the most important priorities in the company’s organizational culture. This characteristic of Ford’s workplace culture entails employee participation. The automaker also emphasizes personal development through team involvement and support. Ford’s corporate culture facilitates teamwork combined with individual knowledge and skills development. To support this characteristic of the business culture, the divisions of Ford’s organizational structure (company structure) collaborate to achieve strategic goals and objectives. Teamwork encourages positive rapport that contributes to the cohesiveness of the automotive business organization.

Role Model Ford Values. Ford Motor Company’s employees represent the business and its core values. This feature of the firm’s organizational culture builds integrity and positive behaviors among workers. For instance, the automaker’s values include initiative, courage, and corporate citizenship . This company culture focuses on quality, safety, and sustainability in all business activities, including vehicle design and manufacturing.

Deliver Results. This characteristic of Ford’s organizational culture is all about effectiveness in satisfying customers and achieving business goals. The company also highlights responsibility and accountability. By delivering results, the automotive business maximizes financial performance through its workplace culture. In addition, this feature of the organizational culture motivates Ford’s employees to achieve higher levels of career development to deliver more to customers and other stakeholders. This cultural trait enhances workforce capabilities and the related competitive advantages identified in the SWOT analysis of Ford Motor Company . The company culture promotes behaviors that lead to the desired results of the business, thereby strengthening organizational effectiveness.

Advantages & Disadvantages of Ford’s Culture

The main advantage of Ford’s organizational culture is its support for unity through teamwork. In the past, the automaker’s regional operations had their respective versions of this corporate culture. Today, the firm’s work culture brings improved business capabilities based on higher human resource effectiveness through unity. However, a disadvantage is that the firm does not specifically address flexibility. Theoretically, flexibility in Ford’s business culture can promote resilience and efficient problem-solving processes that can satisfy business opportunities in the car market and the transportation sector.

• Arena, M., Hines, S., & Golden III, J. (2023). The three Cs for cultivating organizational culture in a hybrid world. Organizational Dynamics, 52 (1), 100958.
• Ford Motor Company – Diversity, Equity & Inclusion .
• Ford Motor Company – Form 10-K .
• Life at Ford .
• U.S. Department of Commerce – International Trade Administration – Automotive Industry .
• Copyright by Panmore Institute - All rights reserved.
• This article may not be reproduced, distributed, or mirrored without written permission from Panmore Institute and its author/s.
• Educators, Researchers, and Students: You are permitted to quote or paraphrase parts of this article (not the entire article) for educational or research purposes, as long as the article is properly cited and referenced together with its URL/link.

Launching a Flawless Fiesta: Ford Motor Company

Ford Motor Company is one of the largest automakers in the United States, producing millions of automobiles each year at 70 plants worldwide. According to J. D. Power and Associates Initial Quality Survey, Ford has received more top rankings than any other automaker since 2007. It’s no surprise that high quality standards have kept Ford an industry leader since 1903. And Ford knows that quality begins at a vehicle’s launch. When a cosmetic problem with the vehicle’s carpet threatened the impending launch of the 2011 Ford Fiesta, the company’s Body Interior Six Sigma team saw a clear opportunity for quality improvement through proven optimization methods. In their quest to maintain high customer satisfaction and performance, the team used Minitab Statistical Software to help them eliminate the carpet defect and achieve a successful launch.

The Challenge

The launch date for the Fiesta was quickly approaching when Ford determined that the appearance of brush marks on vehicle carpets would be unacceptable to customers. Ford’s Body Interior Six Sigma team, led by Six Sigma Master Black Belt Scott Sterbenz, began by working with the supplier to analyze the process used to manufacture the automotive carpet. They found that the settings of a machine called a needler were the likely cause of the diminished product quality.

Ford Motor Company improved the quality of the carpets in the Ford Fiesta with the help of Minitab Statistical Software.

But the manufacturer worried that altering the needler’s settings also would affect the plushness of the carpet. The team needed to find process improvements that would eliminate brush marks while maintaining the plushness, and they also needed to consider other critical qualities, like the carpet’s durability and stain resistance. As they set out to complete the daunting task of improving carpet quality in the Fiesta, the quality improvement experts turned to the Design of Experiment (DOE) tools in Minitab Statistical Software.

How Minitab Helped

In statistics, DOE refers to the creation of a series of experimental runs, or tests, that provide insight into how multiple variables affect an outcome, or response. In a designed experiment, investigators change more than one factor at a time, and then use statistical analysis to determine what factors are important and identify the optimum levels for these factors. It’s an efficient and economical way to improve almost any process.

With time running out, Ford’s improvement team needed to design an experiment that assessed the effects of the six needler settings on the carpet’s brush markings and plushness levels. The experiment had to satisfy a difficult balance: it needed to be rigorous and reliable, but also needed to minimize the cost of materials and disruption to the supplier’s production schedule. Their challenge was to find an experimental design that would gather sufficient data to optimize the needler settings in as few runs as possible.

Experimenters used the Minitab Response Optimizer to determine the optimal configurations for eliminating brush marks and maintaining carpet plushness at the same time.

Minitab’s DOE tools can be used to create and analyze many different kinds of experiments, and can help investigators identify the best experimental design for their situation, based on the number of variables being studied and other conditions. Using Minitab’s DOE tools, the Ford team created a fractional factorial design with center points that would give them the information they needed in only 34 runs.

For each of the experimental runs, a team of evaluators compared the new product to the current carpet, and their ratings were averaged and analyzed. The experimenters also performed a Gage R&R study in Minitab to verify that any changes in the assessed quality of the carpet were a direct result of the factors changed in the experiment, and not due to a variation in the opinions of evaluators.

A Pareto chart created in Minitab clearly shows the three-way interactions that had a significant impact on carpet quality.

When data from the 34 runs were analyzed in Minitab, the results for each response revealed complex interactions between the different needler settings. The interactions explained why previous adjustments to individual needler settings had failed to find a way to eliminate brush markings.

The designed experiment not only provided the team with a list of significant variables and interactions, but also with equations to show how the inputs affected the responses. Even better, the results showed that optimization settings for eliminating brush marks did not have an adverse effect on the plushness.

In response to feedback from both the manufacturer and the Fiesta development team, Sterbenz used Minitab’s Response Optimizer tool to fine-tune the optimal settings identified in the initial DOE. Using the results identified in the DOE as a starting point, the Response Optimizer let Sterbenz and his team modify the settings to consider other practical concerns from the manufacturer and the development team.

After the new carpet from the confirmation runs received favorable ratings by the initial evaluators, samples were sent to Ford’s Research and Engineering Center for final assessment. The samples passed all tests for durability, stain resistance, and color and sheen, and the experiment was deemed a major success by all.

The entire project took 12 days, from the time the problem was defined to the point where the solution was in place and the process was under control. Besides a complete elimination of brush marking and an unexpected improvement in the softness of the carpet in the Fiesta, the experimenters achieved a better understanding of the entire manufacturing process.

Minitab helped Ford discover and implement a solution to find the optimum needler settings to eliminate brush marks and simultaneously maintain the plushness of the carpet. The 2011 Ford Fiesta enjoyed a highly successful launch just a few months later, and marked another milestone in Ford’s commitment to excellence and quality improvement.

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Six Sigma Case Study: Ford Motors

May 19th, 2017

The Ford Motor Company is one of America’s, and the world’s, largest and most successful automakers. Named after its founder Henry Ford, the company is known for its innovative and dynamic approach to manufacturing. Henry Ford pioneered and employed such manufacturing concepts as standardization, assembly lines, which came to be known as Fordism. He also paid his workers a living wage, allowing them to purchase the very products they made. Products like his famous Model T.

Ford was a visionary man. He saw the necessity of breaking down complex tasks into simpler procedures, using specialized tools, and interchangeable parts. While Ford’s assembly line was a revolutionary achievement, his work grew from solidified ideas, with an eye for continuous improvement. Ford looked at established modes and broke them down into their core components, before building them back up again. He strove to take existing processes and always make them more functional, efficient, and effective. There were many advantages to Ford’s ideas. Namely, the significant decrease in costs of production, radically simplifying the labor process and reducing required the workforce.

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But how are Six Sigma and all its related approaches, like Lean and Kaizen , related to Ford? As you may know, Ford is a company known for its high quality. The company has pledged to utilize innovative products and use Total Quality Management to accomplish its goal of Quality Is Job 1 . JD Power and Associates ranked Ford as one of the leading high-quality automakers, but Ford has come a long way in the last few decades. Today we examine just how the Ford Motor Company used Six Sigma to transform its processes and achieve its success.

Why Was Six Sigma Necessary for Ford?

There are four core factors behind Ford’s Six Sigma initiative. These are:

• Cost reduction. Ford’s old production process was surprisingly costly. By introducing Six Sigma, they were no longer using resources that were not necessary.
• Improving quality. Ford has always been known for their quality products, but event heir standards slip from time to time. While, for most companies, a mere 99% quality level is considered acceptable, this lets through a surprising amount of defect. As much as 20,000 instances of defect. Six Sigma espouses that only 99.99966% (and up) is ideal. This percentage limits the number of defects per million to just seven As such, Ford made some great astonishing strides in quality improvement using Six Sigma.  
• Poor customer satisfaction rates. Satisfying customer demand is as critical to success as leveraging it. Many of these issues link to one another, as multiple instances of defect are likely to add up to a defective product. This will inevitably dissatisfy the customer which is why Ford chose to implement Six Sigma, to streamline their processes, and improve production issues. All of which adds up to a more productive company and happier customers.
• Lowering environmental impact by reducing solvent consumption. Six Sigma is an extremely green philosophy, and Ford uses it to make some great changes in their environmental awareness. Ford’s consumption of vital resources proved very costly in the long-term. But by committing to a green work culture with Six Sigma, they reduced costs, increased quality, and improved customer satisfaction.

Ford’s Approach to Six Sigma

The Ford Motor Company began using Six Sigma strategy in the late nineties. Their goal was to become a fully-fledged consumer products company and not just another automobile manufacturer. Additionally, they wished to enhance the quality of their products and to improve their customer satisfaction rates. Their approach towards achieving these goals they referred to as Consumer-driven Six Sigma. Furthermore, Ford was the world’s very first automaker company to implement Six Sigma methodology into their business operations on a large scale.

One of the most pressing problems facing Ford at the time was the 20,000 plus opportunities for defects that came with manufacturing cars. Despite the company’s prior history of quality control and innovation, some defects inevitably slipped through their fingers. Following this revelation, they achieved substantial improvements using Six Sigma. Their aim was to reduce their defect rate to only a single defect per every 14.8 vehicles, and they succeeded. Furthermore, this also satisfied their goal of enhancing customer satisfaction. In Six Sigma, even the smallest change can have a ripple effect, helping to change other processes and move towards continuous improvement.

Obstacles for Ford’s Six Sigma Initiative

Despite its success, there were several obstacles in the way of Ford’s Six Sigma implementation. These are:

• Employee commitment. As is often the case, many employees at Ford, including top-level and senior management, initially viewed Six Sigma with skepticism. This meant a lack of commitment was present from the beginning, proving a major cause of concern for Ford’s Six Sigma implementation. The time constraints, on top of this, made it difficult to put its 350 top leaders through weeks of training.
• Time, Money, Productivity. Furthermore, along with a lack of commitment, key resources like time and money meant employee training was often difficult. The lack of commitment also led to a lack of productivity.
• Data needs. Finally, Ford was new to Six Sigma and poorly equipped to follow through with its Six Sigma initiative. Six Sigma, of course, relies on vast amounts of data to This meant that Ford needed to create and implement new measurement systems to tackle the needs of Six Sigma. Only then was it able to provide any great benefit for the company.

Ford’s Six Sigma Successes

Ford’s use of Six Sigma methodology, while it did provide some road bumps, enabled them to eliminate more than $2.19 billion in waste over the last decade and a half. They solved this problem by applying Lean Six Sigma techniques , such as a data-driven problem-solving process, to devise solutions to waste issues. Moreover, the company’s methodologies for quality improvement and waste elimination saw a staggering impact on the company’s operations. Ford’s Consumer-driven Six Sigma has saved them over a billion dollars worldwide, helping complete almost 10,000 improvement projects since the early 2000s. Regarding customer satisfaction, Ford managed to increase their percentage by five points. We may go as far as to say that Six Sigma saved Ford from its deep-rooted problems. These issues include inadequate productivity, poor use of resources, low customer satisfaction, and environmental unfriendliness.

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Home » Management Case Studies » Case Study: The Magic of Ford

Case Study: The Magic of Ford

In 1903, in a small wagon shop in Dearborn Michigan, a man by the name of Henry Ford started what is today the Ford Motor Company. It started it in 1896 when Henry Ford built his first car. It was only experimental at the time, but less than ten years later in 1908 he introduced a more updated version to the public. This became known as the Ford Model t. Once people realised what a wonderful novelty this was and how it would greatly facilitate their lives, there was a huge demand for them. In order for the company to be able to satisfy this heavy demand, ford introduced the world’s first assembly line for cars. It revolutionised the industry. By 1923 more than half of America’s vehicles were made by Ford. Today, the Ford Motor companies the number two company in its industry as well as the number two industrial corporation in the world. When the average person thinks of the Ford Company, they think of just Ford. This thinking, however, is incorrect. Ford is divided into four major components, automotive, Ford credit, Visteon and Hertz. Ford also produces vehicles under the names of Aston Martin, Ford, jaguar , Lincoln and the Mercury and Volvo brands.

Recently, Ford profits have increased significantly, for the nine months ending 30/09/06; total revenues increased 9% to 127.48 billion dollars. Net income from continuing operations decreased 10% to $4.32 bllion dollars. Results reflect increased vehicle sales offset by higher warranty and costs related to the Firestone recall. Last year’s total sales went up 13% to become 163 billion dollars and profit also rose 10% to become $7.2 billion dollars. As far as Ford Motor Company can remember, this is more than any other car company ever. Ford’s main automotive competitors are General Motors, DaimlerChrysler, Toyota, Honda, Nissan and Volkswagen.

One of the ways that ford has established its spot as the number two company in the automotive market is its focus on customer satisfaction. Ford Motor Company admits that its greatest asset is the trust and confidence earned from its consumers. When people see a Ford trademark, Ford wants them to associate that with a trust mask of certitude, quality, reliability of performance and value. Ford strives to connect with their customers as well as reach them. They try to use relationship marketing, because it is cheaper to keep an old customer rather than to attract new ones. William Clay Ford, Chairman of the the Board for Ford Motor Company says that satisfying customers goes beyond great products and services. People want to do business with companies who care about them and their environment. He realises that the best cars are socially and environmentally responsible. Chief Executive Officer, Jacques A. Nasser states, “ we will be a leader in corporate citizenship if we are a well trusted company that people believe contributes positively to a society and uses its resources to create a more sustainable world .” Jim Vannier, Manager of Ford’s advertising and marketing programs admits “ if you listen to your customer, if you provide the right product at the right time, you’ll get the numbers” . The above quotes make it quite obvious that the top executives of the company all concur that customer satisfaction is of the utmost importance in succeeding. If they keep the customer happy, the customer will tell the others they are satisfied, and more and more people will be wiling to consume their product.

Here and Now

The twentieth century was profoundly affected by the innovations of Henry Ford. The inventions of the automobile gave opportunities to multitudes of people. These opportunities were not just in transportation, but in occupation as well. Today, no matter where a Ford is produced, the consumer knows that they are receiving a high quality product. The reason for this is that the majority of Ford vehicles parts are designed by Ford engineers, manufactured in Ford plants and assembled in Ford product lines. When you purchase a Ford product, you are truly purchasing Ford quality. Ford is the number two manufacturer of automobiles, second only to the General Motors Corporation.

This case highlights certain strategies of this corporation that propelled it to its current number two spot in the market. There are many aspects of marketing strategies that will be discussed in this case such as, product strategies, promotion strategies, pricing strategies as well as internet marketing and other forms of product distribution. Each one of these strategies plays a key role in the success of the number two motor company in the automotive industry. Many people tend not to realise just how important the marketing of a new product can be. It plays a huge role in the success or failure of the new product. For example, many people may remember many years ago when Ford came out with a new vehicle called Edsel. The Edsel became known as one of the Ford Motor Company’s lemon. Although the thought of such an odd-looking car does not sound appealing, it is said that the look is not what caused its downfall. Surprising as it may sound, the demise of this vehicle was due to poor marketing strategies. Ford’s biggest mistake in marketing the Edsel was their failure to decide on their target market. They tried to market their product to everyone, and with such a large span of people this was next to impossible for becoming a success.

Objective of the Company

The mission of the Ford Motor Company is very basic. Ford sees their customers as one of the most important things; they know their customer satisfaction also plays a gigantic role in their success. “[their] mission is to improve continually [their] products and services to meet [their] consumer’s needs, allowing [them] to prosper as a business and to provide a reasonable return for [their] stockholders, the owners of the business. Their mission shows their devotion to constantly improve and while improving, accommodate their customer’s needs. Ford’s five main principals include, 1) Quality: they put the quality of their products first and foremost. Without a quality product, people have no desire to waste their money or jeopardise their safety. 2 ) Customer Care : of you don’t take care of the Customer, someone else will. 3) Constant Improvement : if the Ford Motor Company allowed themselves to remain stagnant in their environment, their competition would eventually have a huge advantage over them, because they would have newer and better product lines to offer. 4)   Employee Involvement : Ford wants each and every employee to be involved in their company. The happier the employee, the better they work. It is all about feeling that they are a part of the Ford team. They also want their employee to think like a consumer, they can cater more to the needs of their actual consumers because they will know what the consumers want. 5) They consider dealers and suppliers to be their partners : without the dealers and suppliers Ford would not be able to manufacture the things they need alone and therefore would not be able to produce as many vehicles as there would be a demand for or even be able to distribute them all to people.

Ford has many competitors. Since Ford is ranked the number two companies, its main competitor is quite obviously the number one company, General Motors Corporation. General Motors, also an American Company holds 29.4% of the automotive market share while following close behind them the Ford Motor Corporation holds 25.1% of the top 5 best selling cars in 1999, Ford Taurus appears as number three and Ford Escort appears as number five in a recent survey. The automotive industry has fierce rivalry among its competitors. In the past years the following mergers have occurred- Daimler Benz acquired Chrysler and Ford bought Volvo in order to be able to properly compete with General Motors, this way Ford is not allowing General Motors to become too much larger than they already are. If General Motors develops a new feature or automobile, Ford must be right behind them with their most innovative invention, and vice-versa.

Ford has 25.1% of the market share presently. This is quite impressive considering that the number one automotive company, General Motors, also an American company has 29.4%. This means that the top two companies hold more than 50% of the market share. This is quite extraordinary. The total market value of the Ford Motor Company is approximately $56 Billion Dollars and their profits are well over $7 Billion. In 2005 Ford sales raised up to $163 billion dollars. This was a thirteen-percent increase from the previous year.

A car, if not properly assembled, maintained, and operated can become a deadly weapon. The United States government regulates many aspects of the auto motive industry. Among these regulations are seatbelts, airbags and shatter proof windshields. The government has also made inspection and maintenance programs more expanded, in order to include more areas and allow for more stringent tests. In 1990 the government amended the Clean Air Act. The main focus of the act was to cut down on all the urban smog, carbon monoxide and particular emissions from Diesel engines and to help decrease acid rain and toxins that motor vehicles contribute to. The amended act demands that polluted cities must sell improved gasoline that helps to reduce ozone forming Hydrocarbons and Carbon Monoxide. Once inside an automobile, the operator of the vehicle is responsible for obeying many regulations as well. It has become extremely important, for instance, to wear your sea belt. Primary enforcement eat belt laws allow police to stop and ticket a driver for not wearing a seat belt, just like any other traffic violation. Seventeen states and the District of Columbia have enacted these laws. The remaining 32 states have secondary laws that allow law enforcement to ticket a driver for not belting up only after the person has been stopped, or ticketed, for another violation, and one state does not have any seat belt law. Obviously, safety best laws work, and the public overwhelmingly supports them. Three out of four Americans supports safety belt laws, according to a recent public opinion survey. Stronger safety belt and child passenger safety laws, and stepped up enforcement of those laws, are the most effective steps we can take to save lives.

Corporate Responsibility Towards Society

Ford Motor Company sponsors many programs to better the community and their safety. For example in the Detroit area, ford organised a weekend clinic in which the automotive safety office educated fifty-five people and their children on the proper use and installation of child safety seats. They demonstrated this in the consumer’s actual vehicles. Ford is also committed to environment cleanliness. They sponsor programs to educate our children on environmental cleanliness and responsibility. They also sponsor company-wide recycling, cleaner operating vehicles, recyclable components, cleaner manufacturing, and employee involvement in environmental activities. Ford do not do these things because they have to, they do it because it is the right thing to do. The Ford Motor Company not only is social active, but culturally as well. Ford provides financial support at many historically black colleges such as Tuskegee University in Albama, this is where the famous black inventor George Washington Carver performed many of his experiments. Ford Motor Company, as of 1999 has 23.2 percent of its employees as minorities. This is up 1% from 1998. Diversity makes the business world go round and no one knows this better than the Ford Motor Company.

Innovation or Death

The Ford Motor Company values their product Analysts. [Their analysts develop product cycle plans that help forecasters determine [their] approach to different markets. The people who start the product cycle are called the research, Design Packaging and Financial analysts. The researchers find out what type of things that consumers would like their vehicles to be occupied with. The Design packagers are the people who decide the most appealing way to package the final product. The financial analysts put the numbers together to figure out exactly how much money all if the above will cost. Next, designers and engineers along with testers actually create the vehicles. They create vehicles according to the specifications of the Research, Design Packaging and Financial Analysts. This way they are producing what the market wants. The research and Advanced technology Teams then decide which technologies should be used in the new products. Ford is constantly trying to improve their product development and expand their innovations. Currently, Ford is working on a new line of intelligent vehicles. These vehicles will enable the driver, through voice activation, to connect to the internet. The voice activation will also be implemented into the navigation system, heating and air-conditioning, cell phones, audio systems, and other electronic things inside the automobile. Ford is adapting to each change in order to be able to bring their customers the most innovative and convenient products possible. As son as new technology becomes available, Ford Motor Company is among the first few to try to implement it into their vehicles.

Product Targeting

Ford motor company has different types of cars, which are each targeted towards many different markets of people. As the company learned the hard way with the Edsel, the importance of a target market is extremely high. Loss of a target marketing focus usually means loss in sales. Ford has a different car targeted towards different age groups, personalities, genders and economic standing and more. The ford Mustang, for example, is targeted mainly at the middle aged. This is exhibited by its slogan of it is what it was and more. This implies that the target consumer would be old enough to remember what the mustang was when it first came out in the 1960’s.

Another example is ford trucks. Their slogan is “Built Ford Tough ”. The toughness implies a target towards rugged men. Because of the fact that the word “tough” is used, it seems that it would be very unlikely that the ford motor company would be using that to attract women. When the word tough is thought of, women are generally not the first thing that comes to mind. The third and final example is the ford Taurus. Its slogan is “ford makes it smart to buy American.” The target market for a ford Taurus is a family. The Taurus station wagon for instance is a great family car with tons of room, yet it handles like a sports car. The above three examples are only a small sampling of what ford offers. Ford motor company manufactures sedans, SUVs, trucks, luxury cars and more. If you are looking for it, the odds are that ford will satisfy you.

Product Mix

The Ford Motor Company has such a wide selection of vehicles in order to satisfy every different type of potential consumer. They offer small cars, sports car, midsize cars, luxury cars, vehicles, convertibles, wagons, minivans, vans, trucks, commercial trucks, and even environmentally efficient cars. Each of Ford’s different types of vehicles have many different options that came along with them the 2001 Explorer for example, runs to roughly $25,715 dollars, without any extras. However, should the consumer decide that he or she would like to add perks, there would be many choices. For instance, in the convenience group of options, you can add anything from a cargo cover to speed control. In the XLS sports group anything from chrome steal wheels to wheel mouldings. There is even a trailer tow prep package, which includes a wiring harness and an H.D. Flasher for only $355 dollars extra. After that the consumer has the option to add even more options. They can customize the engine, transmission, drive, rear axle, wheel type, tire type, seat equipment and much more. The company also offers the Explorer in 10 different colours for the exterior. With the plethora of the above options, how could anyone not find what they are looking for? Each one of the 24 cars manufactured under the Ford name has many options as the Explorer, if not more.

Services Offered

When you own a Ford vehicle, you can register for Owner’s Services. This includes reminders of when your vehicle needs to be services, tips for vehicle safety, maintenance information, does it yourself pointers and online manuals. It also includes warranty guides, offers and discounts exclusive to people registered for the service, online shopping, private communications, and links to Ford Company Specialists. Ford, Lincoln, and mercury dealerships specialize in the servicing of their own vehicles. The dealership is a wonderful place to go to have your breaks served, shocks replaced and batteries as well. The company also offers Extended Service Plans(ESP). With the extended Warranty Plan and the factory unlimited Warranty; you are able to choose a plan that suits your needs. The way the plan works is, you pay a small deductible anywhere from $0-$100. The ford ESP cost protects the consumer from increasing prices in labor and increased prices in parts. Other services that are offered by Ford Motor Company area Customer Assistance Centres, Collision Assistance, Roadside Assistance, Technical Service Information and their website. The web site includes links to safety tips and Frequently Asked Questions.

Promotional Strategies

The current promotions that are offered by the Ford Motor Company are Radiator Service, Brake service, and Batteries. All of the above promotions are wonderful for the upcoming winter months. The radiator service includes, top of all fluids and a free 12pt all weather check of hoses, clamps, belt and more. This promotion and all of the above promotions appeal to people who are thinking ahead to cold winter months. This winter in New York has been predicted to be one of the worst we have seen in a while. A radiator is not actually something you would want to break down in the middle of a snowstorm. The battery promotion is offering a Motorcraft tested, though series battery. They are also offering a Silver Series Battery for only$20 dollars more. Each promotion for a new battery comes with over an 83-month warranty. It is a good idea to replace your battery before a new winter season. When it is freezing outside, trying to find a Good Samaritan who is willing to give you a jump is a rarity. The Brake Promotion comes with the Motorcraft brake service. This promotion includes replacement of brake pads or shoes, front or rear turn rotators and drums. This promotion will also check the brake’s hydraulic system and repair, if necessary. This once again appeals to the person(s) who is preparing for the harsh winter to come. Being that, a bad winter generally means a lot of snow and ice. With weather conditions like that, who needs to worry about brake failure?

Pricing Strategies

One of ford’ pricing strategies is the fact that they try to help the consumer finance a ford vehicle. Ford offers its consumer many plans to choose from in order to find the financing option that best fits their needs. The following are only a few of ford’s financing options. The first is the Red Carpet Lease: the consumer is offered flexibility for payment; there are advance payment plans and Additional payment programs, depending on which one is best for you. The second financing plan is mobility financing: mobility financing offers flexible and convenient financing terms for their physically challenged consumers who need adaptive equipment in their vehicles. The finance rate is based on your credit and the terms of the transaction. Ford credit has earned a top ranking place in the world of automotive finance by providing loans and leases that are convenient and affordable. They also specialize in service such as commercial lending and municipal financing.

The municipal financing is so convenient that it can be calculate on the internet. All that needs to be done in order to do this is, select a vehicle, model, make, and product line. The online calculator will give the consumer an estimated lease and retail payment. Ford financing company provides a verity of products and services to both, the dealers and the consumers. Ford credit also has a commercial lending operation, which caters to light truck fleets and heavy trucks. Ford wants to make it as easy as possible for consumer to be able to drive a ford. There are so many different financing options that are offered, that finding a plan that is right for you has become easier than ever.   If buying a new vehicle is not financially possible, then ford also offers a whole line of pre-owned vehicles, which are backed by Ford Motor Company with a 100 point inspection.

Distribution Internet Marketing

Ford’s newest web site for ford division cars and trucks is www.fordvehicles.com . the new web site allows perspective customer to compare ford vehicles to other cars made by other manufacturers. They are the first company to give consumers the option of product comparison. The section of product comparison on the web site comes complete with photographs, feature description, safety options, competitive pricing, financing and warranty information. Ford division internet coordinator, Trisha Habucke states , “With our new design we incorporated new technologies that deliver more visually exciting content.” The web site is so user friendly that consumers can just go right from one ford vehicle to the next with out any trouble. Ford is committed to brining their customers total brand experience.

For example, ford knows that people with certain types of personalities are attracted to certain types of cars. Explorer drivers, for example are rugged, the “No Boundaries-ford outfitters” slogan appeals to them. When ford began their internet market, they did the most extensive research even conducted by a car company. Their advertising agency, J.Walter Thomson found that 210 test participants concurred that the Ford website deserved a high rating for its complete content. Ford attributes a fair amount of the success to the internet. The internet is a way reach millions of people. The company realizes that is has been a powerful tool is the internet. Erin Hughes, who is a ford employee since 1999, admits that her greatest tool is the internet. Erin’s Regional Manager realized that if they had one person whose sole job was to be dedicated to the internet, the company would proper.

Erin later became the first internet customer satisfaction coordinator. In addition, Hughes started the first internet club for ford dealers. Since the position of internet coordinator so now more common at ford motor companies, once per month all of the internets coordinators get together to share their most recent e-commerce news and best practices. Hughes says “ my job is to provide our dealers with the resources and technology needed to help them sell more vehicles on Main Street and E-street ”. Advertising also plays a large role in the distribution of ford motor company’s products. Ford advertises on television quite often and also on the radio. Previous slogans that ford had etched in everyone’s minds include things like “ Have you Driven a Ford Lately?” with a catchy little tune along with it. Ford also has their slogans and products photographs on major highway billboards a cross the county as well as scoreboards at sporting events such as during commercial breaks where the broadcaster will say something along the lines of sponsored by Ford Motor Company.

The ford motor company has come a very long way, since Henry Ford first established it. They went from a little wagon shop to the second leader in automotive sales. They have been around for almost a century. Ford has elaborative marketing strategies as well as distribution strategies . Their web site was extremely easy and fun to use. Ford is also a very well rounded company in that they are very environmentally concerned. It is nice to see that people realized, if we don’t save our planet now there will be nothing left for future generations. With Ford’s experience and high understanding of, and ambition for the satisfaction of the customer, can they some day be the number one automobile company, beating out the General Motor Corporation?

Q1. Asses the reasons for the growth of the Ford Company.

Q2. Interpolate from the case the clout that the company has in the world economy.

Q3. Assess from the consumer’s perspective the performance of the company’s product.

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Ford's Growth Story Has a Surprising Twist. Does This 1 Catalyst Make the Stock a Buy?

W hen you think of investing in Ford Motor Company (NYSE: F) and its potential growth stories, it's easy to bring up its dividend or dominance in high-value trucks and SUVs, or maybe even its potential in electric vehicles (EVs).

Those are all fine points, but in a surprising twist to many, Ford's most compelling growth story might come from Ford Pro, its solution for commercial customers -- here's why.

Comparing the basics

Ironically, considering over a decade ago most commercial sales were considered low margin and a black eye for Detroit automakers, it's Ford Pro's commercial business that's growing faster and with better margins.

Let's throw some numbers out there for investors to chew on. Ford Blue, essentially the company's traditional gasoline vehicle business, is definitely healthy, hauling in nearly $7.5 billion in earnings before interest and taxes (EBIT) in 2023 at an industry respectable 7.3% EBIT margin. But Ford Pro is set to surpass Ford Blue fairly quickly, hauling in $7.2 billion EBIT in 2023 at a much healthier 12.4% EBIT margin.

Here's the kicker -- Ford Pro is growing rapidly. While Ford Blue's revenue increased 8% in 2023, Ford Pro's revenue grew 19% in the same period, compared to the prior year, and its EBIT of $7.2 billion was more than double its level in 2022 -- more than double ! Put another way, Ford Blue's $7.5 billion EBIT in 2023 grew only $615 million over the prior year, while Ford Pro's increased by $4 billion.

What's driving Ford Pro?

To be fair, Ford Pro is benefiting from 2023 launches of the division's primary vehicle franchises: all-new Super Duty trucks, which sell well in North America, and Transit Custom vans, which sell great in Europe.

Another part of the driving force behind Ford Pro is often overlooked: its software subscriptions and mobile repairs. In fact, during the fourth quarter of 2023 Ford's software subscriptions jumped 50% from the prior year, and orders for mobile repairs more than doubled.

Management also expects Ford Pro's EBIT margins to reach into the mid-teens by around 2026, which is a much more lucrative margin than its core Ford Blue business that is historically in the mid-single digits.

Is Ford a buy?

Investors can make a fairly compelling investment case for Ford at the moment. The stock trades at a modest 11.8 times earnings and boasts not only a regular dividend yield of nearly 5%, but often annual supplemental dividends that are the cherry on top.

Further, as Ford Pro continues its rapid and more profitable growth, the company's bottom line will look better -- and its full-size truck and SUV business is still a healthy bottom-line story.

Another reason investing in Ford makes sense is that its early transition to EVs has been brutal, with a $4.7 billion loss in 2023. But as Ford slowly turns that business around in the next few years, assuming production capacity increases, EV demand increases, and costs are lowered, it'll be a huge boost to the bottom line.

All those reasons make Ford a compelling buy right now. The only issue is that historically, even when Ford makes substantial improvements on the bottom line, the stock price can remain lethargic. Perhaps this time savvy investors will appreciate Ford's smart moves.

Should you invest $1,000 in Ford Motor Company right now?

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Top Six Sigma Case Study 2024

Home Blog Quality Top Six Sigma Case Study 2024

Six Sigma is an array of methods and resources for enhancing corporate operations. When Bill Smith was an engineer at Motorola, he introduced it in 1986 to find and eliminate mistakes and defects, reduce variance, and improve quality and efficiency. Six Sigma was first used in manufacturing as a quality control tool. When long-term defect levels are less than 3.4 defects per million opportunities (DPMO), Six Sigma quality is reached.

Six Sigma case study   offers a glimpse into how various companies have harnessed the five distinct phases: defining, measuring, analyzing, improving, and controlling, principles of Six Sigma to overcome challenges, streamline processes, and improve across diverse industries.

What Are Six Sigma Case Studies, and Why Are They Important?

Six Sigma case studies examples   show how Six Sigma techniques have been used in businesses to solve issues or enhance operations. For practitioners and companies pondering enforcing Six Sigma concepts, these case studies are an invaluable resource to learn the advantages and efficacy of Six Sigma adoption.

Here are the reasons why six sigma case study is important:

Success Illustration: Case studies demonstrate how Six Sigma projects generate tangible advantages like better productivity, fewer defects, and more customer satisfaction while providing unambiguous evidence of their efficacy.

Learning Opportunities:  They deliver vital insights to use Six Sigma tools and processes realistically and allow others to learn from successful approaches and avoid common errors.

ROI Demonstration:  Case studies provide quantitative data to show the return on investment from Six Sigma projects, which helps justify resources and get support for future initiatives.

Promoting Adoption:  They cultivate a continuous improvement culture and show how Six Sigma concepts can be used in different situations and sectors, which encourages other businesses to embrace the methodology.

Become a Six Sigma Certified Professional and lead process improvement teams to success. Learn how to streamline processes and drive organizational growth in any industry. Join our Lean 6 Sigma training courses and transform your career trajectory with valuable skills and industry recognition.

Six Sigma Case Studies

Let us discuss some real-world case study on six sigma   examples of successful Six Sigma undertakings through case studies:

1. Six Sigma Success: Catalent Pharma Solutions

Do you know how Six Sigma techniques turned things around for Catalent Pharma Solutions?

Six Sigma methodologies, initially presented by Motorola in 1986 and prominently used by General Electric during CEO Jack Welch's leadership, are essential for enhancing customer contentment via defect minimization. Catalent Pharma Solutions, a top pharmaceutical development business, employed Six Sigma to address high mistake rates in its Zydis product line. By applying statistical analysis and automation, training employees to various belt levels, and implementing Six Sigma procedures, Catalent was able to maintain product batches and boost production. This case study illustrates how Six Sigma approaches are beneficial for businesses across all industries as they can improve processes, prevent losses, and aid in cost reduction.

2. TDLR's Record Management: A Six Sigma Success Story

The Texas Department of Licensing and Regulation (TDLR) faced escalating costs due to the storage of records, prompting a Six Sigma initiative led by Alaric Robertson. By implementing Six Sigma methodologies, process mapping, and systematic review, TDLR successfully reduced storage costs and streamlined record management processes. With a team effort and strategic changes, TDLR has achieved significant cost savings and improved efficiency. The project also led to the establishment of a robust records management department within TDLR.

3. Six Sigma Environmental Success: Baxter Manufacturing

Baxter Manufacturing utilized Six Sigma principles to enhance its environmental performance and aim for greater efficiency. Through the implementation of Lean manufacturing and accurate data collection, Baxter reduced waste generation while doubling revenue and maintaining waste levels. With a cross-functional team trained in Six Sigma, the company achieved significant water and cost savings without major investments in technology. It led to promotions for team leaders and showcased the effectiveness of Six Sigma in improving environmental sustainability.

4. Aerospace Manufacturer Boosts Efficiency With Six Sigma

Have you heard about how Six Sigma principles transformed an aerospace parts manufacturer? Here is the 6 Sigma case study   for aerospace parts manufacturer

A small aerospace parts manufacturer used Six Sigma to cut machining cycle time, reducing costs. Key engineers obtained Six Sigma certification and led the project, involving management and operators. Using DMAIC, they analyzed data, identified root causes, and implemented lean solutions. The process yielded a 46% reduction in cycle time and an 80% decrease in variation, enhanced productivity and profitability. The case highlights how Six Sigma principles can benefit businesses of all sizes and emphasizes the importance of training for successful implementation.

Enroll in the  Lean Six Sigma Green Belt certification online training to advance your career! Gain expertise in process improvement and organizational transformation with expert-led training and real-world case studies. Start now to become a certified professional in quality management.

5. Ford Motors: Driving Success

This is a   case study on Six Sigma  i ncorporated by Ford Motors to streamline processes, improve quality, significantly reduce costs, and reduce environmental impact. Initially met with skepticism, Ford's implementation overcame challenges, achieving remarkable results: $2.19 billion in waste reduction, $1 billion in savings, and a five-point increase in customer satisfaction. Ford's Consumer-driven Six Sigma initiative set a benchmark in the automotive industry and proved the efficacy of data-driven problem-solving. Despite obstacles, Ford's Six Sigma exemplifies transformative success in process improvement and customer satisfaction enhancement.

6. 3M's Pollution Prevention Six Sigma Success

Have you checked out how 3M tackled pollution with Six Sigma? It's pretty remarkable. 3M leveraged Six Sigma to pioneer pollution prevention, saving $1 billion and averting 2.6 million pounds of pollutants over 31 years. With 55,000 employees trained and 45,000 Lean Six Sigma projects completed, they focused on waste reduction and energy efficiency. Results included a 61% decrease in volatile air emissions and a 64% reduction in EPA Toxic Release Inventory. Surpassing goals, they doubled Pollution Prevention Pays projects and showcased Six Sigma's prowess in cost-saving measures.

7. Microsoft Sigma Story Lean Six Sigma

By using Lean Six Sigma case studies, Microsoft increased customer interactions and profitability through waste removal and process optimization. They concentrated on improving the quality of the current process and reducing problems by utilizing the DMAIC technique. Eight areas were the focus of waste elimination: motion, inventory, non-value-added procedures, waiting periods, overproduction, defects, and underutilized staff talent. Microsoft streamlined processes and encouraged innovation, which allowed them to maintain productivity and client satisfaction even as technology changed.

8. Xerox's Lean Six Sigma Success Story Six Sigma

It is another important case study of the Six Sigma project. When Xerox implemented Lean Six Sigma in 2003, the organization underwent a significant transformation. They reduced variance and eliminated waste as they painstakingly optimized internal operations. It improved their operational effectiveness and raised the caliber of their goods and services. Through extensive training programs for staff members, Xerox enabled its employees to spearhead projects aimed at improving different departments and functions. The organization saw significant improvements in customer satisfaction and service performance.

9. A Green Belt Project Six Sigma Case Study

It is one of the best examples of a Six Sigma case study. Anne Cesarone's Green Belt project successfully reduced router configuration time by 16 minutes, a remarkable 55% improvement. Anne maintained router inventory, made improvements to documentation and configuration files, and started router requests sooner by resolving last-minute requests and setup mistakes. The initiative resulted in less router programming time from 29 to 13 minutes, an increase in router order lead time of 11 days, and a 60% drop in incorrect configurations. These raised customer happiness and increased operational effectiveness while proving the benefits of process improvement initiatives.

10. Improving Street Maintenance Payments with Lean Six Sigma

Jessica Shirley-Saenz, a Black Belt at the City of San Antonio, used Lean Six Sigma to address delays in street maintenance payments Lean Six Sigma case study examples. Contractors were experiencing extended payment times, risking project delays and city infrastructure integrity. Root causes included payment rejections and delayed invoicing. By implementing quantity tolerance thresholds, centralizing documentation processes, and updating payment workflows, monthly payment requests increased from 97 to 116. Rejected payments decreased from 17 to 12, reducing the rejection percentage from 58% to 42%, saving $6.6 million.

 Six Sigma's effectiveness spans industries, from healthcare to technology. Case studies demonstrate its ability to optimize processes and improve outcomes. From healthcare facilities streamlining patient care to tech companies enhancing software development, Six Sigma offers adaptable solutions for diverse challenges. These real-world examples illustrate how its methodologies drive efficiency, quality, and customer satisfaction. Professionals can learn valuable lessons from using Six Sigma in healthcare studies, identify strategies to overcome obstacles and facilitate continuous improvement. Organizations can emulate best practices and implement similar initiatives to achieve measurable results by studying successful implementations.

Ready to enhance your skills and advance your career with Six Sigma certification? Join our comprehensive KnowledgeHut's best lean Six Sigma courses to master Six Sigma principles and methodologies. Become a sought-after professional in IT, Manufacturing, Healthcare, Finance, and more industries. Enroll now to accelerate your career growth!

Frequently Asked Questions (FAQs)

Six Sigma case studies are available in various formats and places, such as books, academic journals, professional publications, and Internet sites. Many companies that have effectively adopted Six Sigma publish their case studies on their websites or at industry exhibitions and conferences.

Six Sigma case studies provide insightful information on how businesses have addressed certain issues, enhanced procedures, and produced noticeable outcomes. Professionals gain knowledge about best practices, prevalent errors to avoid, and creative problem-solving methods in several industries and circumstances.

Professionals can share their Six Sigma case studies through industry forums, professional networking platforms, blogs, and social media. They can submit their case studies to publications or at conferences and workshops to reach a wider audience within the Six Sigma community.

Shivender Sharma

Shivendra Sharma, an accomplished author of the international bestseller 'Being Yogi,' is a multifaceted professional. With an MBA in HR and a Lean Six Sigma Master Black Belt, he boasts 15 years of experience in business and digital transformation, strategy consulting, and process improvement. As a member of the Technical Committee of the International Association of Six Sigma Certification (IASSC), he has led multi-million dollar savings through organization-wide transformation projects. Shivendra's expertise lies in deploying Lean and Six Sigma tools across global stakeholders in EMEA, North America, and APAC, achieving remarkable business results. 

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Author Interviews

Christine blasey ford aims to own her story with 'one way back'.

Reena Advani

Christine Blasey Ford speaks during a hearing of the Senate Judiciary Committee, Sept. 27, 2018, on Capitol Hill in Washington, D.C. Michael Reynolds/AP hide caption

Christine Blasey Ford speaks during a hearing of the Senate Judiciary Committee, Sept. 27, 2018, on Capitol Hill in Washington, D.C.

Christine Blasey Ford said civic duty compelled her to come forward when she learned Brett Kavanaugh was President Trump's top choice for a Supreme Court opening in the summer of 2018. But her testimony did not change the ultimate result of Kavanaugh's nomination.

Ford testified before the Senate Judiciary Committee that Kavanaugh had sexually assaulted her at a party back when they were teenagers in the Washington, D.C., area. When it was Kavanaugh's turn to testify, he denied it happened.

In her new book, One Way Back, she writes "My story just can't be about the three months in 2018 when my life exploded in front of the world's eyes. My life weaves together surfing, statistics, motherhood, friendships, and politics."

In an interview on Morning Edition, Ford said it was only a couple of years ago that she felt ready to revisit how her life was upended by Kavanaugh's rise to the exalted position on the U.S. Supreme Court. Tired of an endless smear campaign, she decided it was time to write her own story.

While she moved far away from Washington, Ford says what she experienced there in her teenage years left an indelible mark. Reluctant to testify in a public setting, Ford forged ahead nonetheless. She writes that part of what gave her the strength to do so was her love of surfing; Ford equates the experience to facing the intensity of ocean waves. "You've got to take the wave and you might wipe out. You might get crushed and held under by three waves or you might get a great wave, you know? But you're going to have to take it," she told NPR's Michel Martin.

Ford received tens of thousands of letters from supporters and detractors. She would have to hire a security team, take her family into hiding after threats to kill her, and she would see her character and sanity assailed for years.

But she also became a symbol of courage and hope to untold numbers of people. Following is an interview between NPR's Michel Martin and Christine Blasey Ford. It has been lightly edited for length and clarity.

To hear the broadcast version of this conversation, use the audio player at the top of this page.

How did you come to share your story with the judiciary committee?

When I saw the short list, I was concerned and felt that I at least needed to share the information, not necessarily publicly, but let the government know that that had happened to me and that possibly they would want to look into some of the other candidates on that list.

Why did you think that was important to do?

I felt like as a citizen that it's our responsibility to weigh in when we have relevant information for a job of that level of esteem and importance. I grew up in Washington, D.C., so I had high reverence for all of our governmental institutions and the Supreme Court as a child visiting there on field trips, that seemed to be where we send the best of the best. And I just felt a sense of patriotism and civic duty that I needed to let someone know and that they could then decide if it was of import.

This is years after Anita Hill was subpoenaed to testify, after it became known that she had had what she said was an experience of sexual harassment with Clarence Thomas when they both worked together. And that was a very bruising experience, you know, for all involved. Do you remember the whole experience with Anita Hill and Clarence Thomas? Did you think it would be like that or did you think it would be different than that?

I do remember that very well, and I remember most about that is her level of detail in recalling the incidents. I was hoping that it was not going to be similar. I was very scared of the idea of sitting in front of the Senate, and I was hoping that there was some other way that it could play out where I could share the information with the senators without having to sit in Washington, D.C., with them in that big room where she sat.

One of the things that surprised me, people may remember this from the coverage even at the time, is that the committee really did not want to hear from you. Did you find that surprising after all these years after Anita Hill was subpoenaed to testify against Clarence Thomas, and they were heavily criticized for this. At the time, the Judiciary Committee was all male. That was one of the issues sort of at play here .But did you think it would be different all these years later, that they really did want to hear from you?

I did overestimate how interested they would be in this information. I really thought that it was important for them to know and that they would want to know. And I viewed myself as helpful like I was trying to be helpful to them and apparently that was not how they necessarily viewed it and it became highly politicized.

When a decision was made and it was clear that you were then going to testify, can you even sort of describe what it was like to be in the middle of that?

I was still ambivalent about speaking publicly in front of the Senate. I wanted to meet with them privately. And I wrote a letter saying that I felt that was the best thing to do for his family and for my family and would reduce sort of the amount of attention and the circus around it and as well as the threats to both families. So that was my preference but it didn't happen that way. They wanted to have an open hearing. I wasn't watching it or thinking about how it connected to a MeToo movement or to another hearing. I was just trying to get through it.

What made you finally decide to cross that threshold? I was struck by your saying up to the last minute you were not sure you were going to go through with it. Why do you think you did?

Well, I certainly had a phone and email inbox full of messages of people telling me not to do it, either for caring reasons or for reasons where they were trying to scare me. And then I also had text messages and emails full of people from all over the world saying, we need you to do this as survivors. And so I had a lot of people, weighing in on what I should do. And it seemed like it was about 50-50 and finally I thought, this is so stressful, maybe this will just end the stress and that maybe if I testify, it'll be over.

The level of smear media and a report from the Senate or from half of the committee with allegations that are salacious and criminal, that felt really gut wrenching for me because those were the people that I set out to help. So to me, that's kind of the hardest part is setting out as a citizen and feeling you have a patriotic duty and a higher calling and that you're willing to sustain some level of backlash. But to have the actual people that you're trying to help be the people who are involved in that backlash is a little bit difficult to come to terms with. And part of why I wrote the book is I don't want it to be the case that other people don't come forward. So I wanted to show that no matter how scary this is, it is something you can live through and survive and come out the other side.

Nina Kravinsky produced the audio for this story. Meghan Sullivan edited the digital version.