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    Case Analysis: Ford Motor Company - Supply Chain Strategy

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    Ford faced increasing competition and decreasing profits. It considered adopting a "Virtual Integration" supply chain model like Dell to reduce costs, improve quality, and increase value. However, some felt auto manufacturing differed significantly from computers. Ford instead implemented an ambitious restructuring plan called "Ford 2000" to cut costs by standardizing global processes, consolidating development centers, using IT to streamline materials and inventory, and partnering with suppliers through new networks.

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    Case Analysis: Ford Motor Company - Supply Chain Strategy

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    YbrantSachin
    59 views7 pages
    Ford faced increasing competition and decreasing profits. It considered adopting a "Virtual Integration" supply chain model like Dell to reduce costs, improve quality, and increase value. However, some felt auto manufacturing differed significantly from computers. Ford instead implemented an ambitious restructuring plan called "Ford 2000" to cut costs by standardizing global processes, consolidating development centers, using IT to streamline materials and inventory, and partnering with suppliers through new networks.

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    Ford faced increasing competition and decreasing profits. It considered adopting a "Virtual Integration" supply chain model like Dell to reduce costs, improve quality, and increase value. However, some felt auto manufacturing differed significantly from computers. Ford instead implemented an ambitious restructuring plan called "Ford 2000" to cut costs by standardizing global processes, consolidating development centers, using IT to streamline materials and inventory, and partnering with suppliers through new networks.

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    Download as pptx, pdf, or txt
    59 views7 pages

    Case Analysis: Ford Motor Company - Supply Chain Strategy

    Uploaded by

    YbrantSachin
    Ford faced increasing competition and decreasing profits. It considered adopting a "Virtual Integration" supply chain model like Dell to reduce costs, improve quality, and increase value. However, some felt auto manufacturing differed significantly from computers. Ford instead implemented an ambitious restructuring plan called "Ford 2000" to cut costs by standardizing global processes, consolidating development centers, using IT to streamline materials and inventory, and partnering with suppliers through new networks.

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    CASE ANALYSIS

    Ford Motor Company - Supply


    Chain Strategy

    About the Company


    Founded by Henry Ford and incorporated on June 16,
    1903
    The Ford Motor Company is based in Dearborn ,
    Michigan.
    Second largest industrial corporation of the world.
    Revenues more than $144 billion (at the time when case
    was written).
    About 370000 employees
    Operations in more than 200 countries
    Sells commercial automobiles under Ford Brand and

    About the Case


    Discusses about Fords Future.
    How should the company make proper use of internet
    technologies and innovative ideas to improve on various
    aspects : Better supplier relationships , Reduced production
    costs , reduced working capital , reduced cycle time etc.
    How can the company increase shareholders value ?
    Two groups : One favoured Virtual Integration model
    which is used by Dell
    Other group resisted as there are lot of differences in
    Automobile Business and Computer Manufacturing business.

    Problems/Issues :
    Increased production cost and cycle time at Ford
    Decreasing shareholder value
    Home markets being captured by foreign-based auto
    manufacturers like Toyota and Honda Increased competition
    Need of quality improvement
    Lesser profits at Ford as compared to comparatively newer
    companies like Dell and Cisco
    Need of a much efficient competitive supply chain
    Implementation of Dell model whether it will work or not ?
    Whether Virtual Integration will work for Ford or not ?

    Solutions:
    Ambitious restructuring plan Ford 2000 included
    merging its North American , European and International
    Operations into a single global organization.
    Aimed at dramatic cost reductions by reengineering and
    globalizing corporate organizations and processes.
    Consolidation of product development activities into five
    Vehicle Centres- each responsible for product (vehicle)
    development for particular consumer market.

    Making processes globally common- leading to process


    redundancies and economies of scale.
    Use of IT to enhance material flows and reduce
    inventories.
    Launch of a public internet site , a company-wide
    intranet network for better coordination between teams
    and an extranet network for better coordination with
    suppliers.

    Partnered with Chrysler and GM to work on automotive


    network exchange (ANX) aimed at consistency in
    technology standards and better coordination with
    suppliers.

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