Bill Ford took over Ford Motors in 2001 as the CEO, when the company was struggling with falling sales around the world – in a time when the company desperately needed careful planning and their execution. Bill Ford revised and updated the company’s tactical plans – cutting costs, gaining back the experienced staff, catering to specific market niches and more. Some of these targets have been met, a good number of them still need work. There are great challenges ahead for Bill Ford, but perhaps he can show the great management abilities of the Ford family and turn around the situation. 1.
Based on information in the case, what are some of Ford’s strategic goals? What are some of Ford’s tactical goals? After Bill Ford’s assuming of the position of CEO, Ford Motors have faced some revisions and updating of its strategic and tactical goals. Ford Motors have been experiencing falling sales and inadequate funding for its operations. Ford has set its strategic goals as operating more cost effectively and to cut expenses, get better sales output, and ensuring quality of its products and services. To that end, the company’s tactical goals are – -To improve sales, specific market niches are targeted.
This is because customer tastes in automobile market has become more specialized and specific. Delivering to these specific tastes can mean less competition and more sales. – Increase the production of the profitable Jaguar series of cars. -New advertisement campaigns to promote the Ford brand name. -Cutting costs by taking a stronger stance with the United Auto Workers union. -Cutting costs by closing down five major plants, and laying off 35,000 workers within five years. 2. What are some of the actions that Bill Ford and other managers must take in order to ensure a successful implementation of Ford’s tactical plans?
Bill Ford’s tactical plans can get the company out of its difficult situation, if they are executed properly. Their successful implementation depends on how Ford uses its resources, and timely execution of the steps it has to take. To deal with the problems regarding the funding and resources, Ford has planned to shut down five of its major plants and lay off 35,000 workers. These needs to be approached with tact and the timing must be immaculate. If this is done too rashly, not only production will fall in a rate that is not anticipated, this can reduce efficiency and affect morale as well.
For example, one of Bill Ford’s plans – to increase the production of Jaguar series, was executed too early, and it led to quality problems that resulted in a fall of customer satisfaction rating to number nineteen from the second position. 3. What barriers to planning has Bill Ford experienced? What has he done, or what should he do, in order to overcome those barriers? Bill Ford, when he took over as the CEO of Ford Motors, has faced numerous problems. To provide new and more careful planning for the firm, he has faced some barriers.
The barriers to planning he had experienced were – dynamic and complex environment, resistance to change, and financial constraints. The customer tastes in automobile industry has changed, and most auto manufacturers are struggling with slowing worldwide economy. Ford now operates in a dynamic and complex environment, and the rate at which design innovations are introduced forces Ford to react fast when competitors offer something unique to a particular market niche. Specific markets have become more important than mass-volume general purpose vehicles.
Now the industry has to balance carefully between the R&D and output quantity to keep the sales up, and prevent suffering loss. Till Bill Ford’s sweeping changes in the company goals, Ford wasn’t changing itself with its environment to the extent its competitors did. The company showed a certain degree of resistance to change. Ford was also facing financial constraints. International acquisitions were proving costly in the short run. Ford was forced to securitize its loans to gain funding, yet stock prices continued to fall – from $35 in mid-1999 it became less than $10.
The company is having more and more difficult time borrowing funds. Yet executing some of the new plans required a degree of financial freedom. Bill Ford has already done much to overcome these barriers and he intends to do more. He has shifted the fir’s R&D focus to developing cars for specific niches to better react to the dynamic market. He has made the company revise and update its goals to better suit the troubles it is going through. To deal with the difficult financial condition he has aimed to cut costs, taking stronger stance with United Auto Workers union, laying off workers and shutting down major plants.