Professional Documents
Culture Documents
Ford Motors
Ford Motors
Ford Motors
Ford Motor Company, American automotive corporation founded in 1903 by Henry Ford and 11
associate investors. In 1919 the company was reincorporated, with Ford, his wife, Clara, and his
son, Edsel, acquiring full ownership; they, their heirs, and the Ford Foundation (formed 1936)
were sole stockholders until January 1956, when public sale of the common stock was first
offered. The company manufactures passenger cars, trucks, and tractors as well as automotive
parts and accessories. Headquarters are in Dearborn,Michigan.
Henry Ford built his first experimental car in a workshop behind his home in Detroit in 1896.
After formation of the Ford Motor Company, the first Ford car was assembled at the Mack
Avenue plant in July 1903. Five years later, in 1908, the highly successful Model T was
introduced. Demand for this car was so great that Ford developed new mass-production methods
in order to manufacture it in sufficient quantities; in 1911 he established the industrys first U.S.
branch assembly plant (in Kansas City, Missouri) and opened the companys first overseas
production plant in Manchester, England; in 1913 he introduced the worlds first
moving assembly line for cars; and in 1914, to further improve labour productivity, he introduced
the $5 daily wage for an eight-hour day (replacing $2.34 for a nine-hour day).
The companys first international sales branch opened in Paris in 1908. By mid-1914 there were
more than 500,000 Model Ts on the roads of the world; by 1923 the company was producing
more than half of Americas automobiles; and, by the end of the 1920s, Ford had more than 20
overseas assembly plants in Europe, Latin America, Canada, Asia, South Africa, and Australia.
The Ford had become the worlds most familiar make of car. In 1927 the last Model T and the
first new Model A were produced, followed in 1932 by the first Ford V-8. In 1922 Ford had
acquired the Lincoln Motor Company (founded 1917), which would produce Fords luxury
Lincolns and Continentals. In 1938 Ford introduced the firstMercury, a car in the medium-priced
range.
As early as 1906 Henry Ford had acquired 58.5 percent of the companys stock; and, when the
other stockholders balked at the idea of building the giant (and expensive) River Rouge plant in
Dearborn, he bought them out; Edsel Ford (18931943) became president (1919). On Edsels
death in 1943, Henry Ford returned to the presidency, but in 1945 he turned it over to his
grandson, Henry Ford II, who reorganized the companys tangled system of financial
management and reinvigorated its corporate culture by hiring talented younger managers. The
failed introduction of the Edsel (model years 195860) occurred amid these successes. Henry
Ford II continued to guide the company as chief executive officer (194570) and chairman of the
board (196080).
In the 1950s and 60s the Ford Motor Company began limited diversification, but by the 1990s it
had refocused attention on its automotive concerns and financial services. In 198990 Ford
acquired Jaguar, a British manufacturer of luxury cars. Aston Martin became a wholly owned
subsidiary in 1993. Later acquisitions included the rental car company Hertz Corporation in
1994, the automobile division of Volvo in 1999, and the Land Rover brand of sport utility
vehicles in 2000. Ford also purchased a significant share of the Mazda Motor Corporation.
However, as Ford struggled in the early 21st century, it began selling a number of its brands. In
2007 the company sold Aston Martin, and the following year it sold Jaguar and Land Rover
to Tata Motors Ltd. of India.
In December 2008 Pres. George W. Bush announced an emergency financial rescue plan to aid
the Big Three automakersChrysler LLC, General Motors Corporation, and Fordto prevent
the collapse of the countrys struggling auto industry. The plan made immediately available
$13.4 billion in government loans from the Troubled Assets Relief Program (TARP), a $700
billion fund approved by Congress to aid the financial industry following the subprime mortgage
crisis. The loans would allow the auto companies to continue operating through March 2009,
when they were required to demonstrate financial viability or return the money. An additional
stipulation required the companies to undergo restructuring. The money was initially made
available to General Motors and Chrysler; Ford purportedly possessed adequate funds to
continue operations and, thus, did not immediately require government relief.
Able to avoid bankruptcyfor which both General Motors and Chrysler filedFord
experienced increased sales and market share in 2009. The growth was partially due to the
federal governments cash-for-clunkers plan, which gave consumers up to $4,500 toward
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trade-ins of older cars for new fuel-efficient models. In addition, Ford adopted various costcutting measures and focused on stronger brands. In March 2010 the automaker agreed to sell
Volvo to the Chinese company Zhejiang Geely Holding. Several months later Ford announced
that it would discontinue its Mercury line.
Values
How do we accomplish our mission is as important as the mission itself. Fundamental to success
for the company are these basic values:
People: Our people are the source of our strength. They provide our corporate intelligence
and determine our reputation and vitality. Involvement and teamwork are our core human
values.
Products: Our products are the end result of our efforts, and they should be the best in
serving our customers worldwide. As our products are viewed, so are we viewed.
Profits: Profits are the ultimate measure of how efficiently we provide customers with the
best products for their needs. Profits are required to survive and grow.
Guiding Principles
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Quality comes first: To achieve customer satisfaction the quality of our products and
services must be our number one priority.
Customers are the focus of everything we do. Our work must be done with our customers
in mind, providing better products and services than our competition.
Employee involvement is our way of life. We are a team. We must treat each other with
trust and respect.
Dealers and suppliers are our partners. The Company must maintain mutually beneficial
relationships with dealers, suppliers and our other business associates.
Integrity
in a manner that is socially responsible and commands respect for its integrity and for its
positive contributions to society. Our doors are open to men and women alike without
discrimination and without regard to ethnic origin or personal beliefs.
ETHICS
Ethics defines the elements essential to human well-being and proposes principles to be used as
guidelines for generating an ethical culture. Ethics also refers to the specific values, standards,
rules, and agreements people adopt for conducting their lives. Ethics, most broadly, is the study
of human behavior and its consequences in the light of what is ideally possible. For example,
ethicists might study a society's mores or morals to determine what effect they would have on
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humankind if they were used as universal standards. Ethics are not merely social conventions,
like table manners. Ethics define the social conditions necessary for human beings to thrive.
How do we know what is ethical? Ethical wisdom is the product of a long history of human
struggle. By trial and error societies discover how to create mutually enhancing relationships. Yet
ethics
also
come
from
the
reality-producing
function
of
the
mind.
In addition to being propelled by events of the past, human beings are simultaneously drawn
forward by their view of the possibilities of the future. When people act "as if" something can
happen, they can behave so as make it a self-fulfilling prophecy. The challenge is to understand
what conditions lead to human well-being, to envision an ideal ethical culture, and then derive
principles that would create a good life. What does it mean to act ethically? Ethical Culture
proposes that the state of spiritual-ethical harmony would be created whenever people live by
these three guidelines taken together:
Act so as to elicit the best and most distinctive qualities in others and thereby in oneself.
eliminating the use and creation of toxic materials. Some of their core requirements include
knowing both legal and company initiated requirements, using the companys environmental
specialists to assist with responsibilities, if an employee is contacted by a government agency
regarding any environmental issue they are to report it immediately, and always ask the
Environmental quality office, or vehicle environmental engineering questions if you are unsure
about something. Even with all of their efforts to harm the environment as little as possible,
most all-automobile manufacturers are still criticized for SUVs and other harmful vehicles.
Fords response to this is their Hybrid vehicles as well as the Ford Focus, which they are trying
to get to 70 mpg fuel efficiency. Other efforts Ford has made over the past few years include a
reduction of waste in plants, landfill gases supply energy to their plants, and paint and solvent
waste have been converted to other uses. Ford has also created a Product Sustainability Index
for their automobiles. Their website allows you to choose an environmental issue you are
concerned about and view how their different car models relate to that issue and have they have
improved over time.
Conflict of Interest
It is important to Ford Motor Company that all employees understand the concept of Conflict of
Interest. Ford Motor Companys Code of Ethics properly defines conflict of interest as when a
directors personal interest is adverse to or may appear to be adverse to the interests of the
Company as a whole. Conflict of interest can also arise, according to Ford, when a director, or a
member of his or her immediate family, receives improper personal benefits as a result of his or
her position as a director of the Company. There are also a few examples of conflict of interest
stated within the Code of Ethics. Among these are relationships of company with third parties
which does not let directors engage in any activities that are not in the best interest of the
company or that impair the Companys relationship with a future client. Compensation from nonCompany sources doesnt allow directors to accept compensation for services performed for the
Company from any source other than the Company. Another example is gifts. Directors and
members of their families are not allowed to accept gifts from persons or entities who deal with
the Company in the case that the gift has more than a nominal value or where acceptance of the
gift would create the appearance of conflict of interest. Ford Motor Company has a low tolerance
for conflict of interest, wanting to look their best for their stakeholders and client.
Anti-Harassment
Ford Motor Company has long maintained an anti-harassment policy as part of their commitment
to having a respectful work environment. Ford defines harassment as language or conduct that
may be derogatory, intimidating, or offensive to others. People are encouraged to report any
harassment they see or take part in, and the code requires managers to promptly address the
issues being brought up to them. Also stated, it is unacceptable to retaliate against some one who
reported harassment, which again gives reassurance to the employees that bad will happen to
them if they do report.
requirement states the compliance with the Companys health and safety requirements, with the
failure to do so may result in discipline, up to and including termination or release.
Remember that a major objective of the companys research and development efforts is the
implementation of product, process, and manufacturing innovations that provide customer
benefit and value, and that help protect the environment and enhance safety.
Consider the performance throughout the life of the vehicle when working to meet the safety
needs and expectations of the Companys customers. Address in-service safety concerns in a
timely, customer-driven manner. These core requirements pertaining to Product Quality and
Safety show that Ford Motor Company has product quality and safety as their number one
priority, and is doing their best to ensure this quality and safety for their customers.
battery life, distance to a charge point, and any budget or range surplus that exists. Over 30
drivers have helped Ford refine the in-dash display over the past year
Since the screens are an integral part of Focus Electric. The simulator allows drivers to navigate
an 11-mile course that includes terrain like hills, city streets, country roads, and flat lands. This in
addition to other research revealed the following:
Sea-changing growth in awareness among consumers regarding climate change
60 percent of customers would buy a hybrid or electric vehicle if there was no price
penalty. When customers are asked if they would accept a higher price if the premium is
paid off in four years, 26 percent say theyd still be interested in a hybrid or electric. Refine the
in-dash display program so that drivers can now easily understand how to more efficiently
brake.
Objectives
Within the next twelve months, Ford Motors will:
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MARKETING STRATEGIES
PRODUCT-MARKET COMBINATIONS
Ford Motor Company has being producing cars since the 1920s, however, The Focus Electric is
Ford's first full all-electric passenger vehicle, and production began in December
2011. Deliveries for fleet customers in the United States began in December2011, and it was
released to retail customers in May 2012 only in California, New York and New Jersey, in
limited numbers, followed by the other 16 initial markets in the third quarter of 2012 As the
demand for electric vehicles continues to grow, it is expected that all Ford dealers will be
equipped to sell and maintain the electric vehicles.
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Service Strategies
Ford Motor Company launched several programs designed to increase car-owner satisfaction and
the experience customers have with Ford after their purchase. Two new self-service Websites,
www.customersaskford.com and www.dealersaskford.com, allow visitors and dealers to easily
find the information they need. In addition, the company is expanding into Web 2.0
communication channels to establish a direct dialogue with owners. These efforts will be
integrated across channels to help Ford improve customer and dealer satisfaction while lowering
overhead costs.
In addition, unlike Fords main competitor Tesla, Ford has over one thousand dealership across
the country equipped with facilities and trained staff to provide regular maintenance and repairs
for customers.
Pricing Strategies
Pricing is one of the key strategies Ford is using to market the Ford Focus Electric. Ford has
reduced the of the product by more than $10,000 since introduction and its also making it to
lease for only $179 for 36 months with $2,564 due at signing and the security deposit waived.
The company is also investing more in the electric technology to mass produce the Electric
vehicles in order to be able to sell them at a price much lower than the competitors and still make
a good profit margin.
.
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Intellectual property
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Ethical dilemma is a problematic situation or group of situations in which the corporation or the
person concerned needs to make a choice within several options available, none of which solves
the situation ethically.
The ethical dilemma of Ford Motors
Among automakers, Ford Motor Company is the worst. Every year since 1999, the US
Environmental Protection Agency has ranked Ford cars, trucks and SUVs as having the worst
overall fuel economy of any American automaker. Ford's current car and truck fleet has a lower
average fuel efficiency than the original Ford Model-T.
Ford is also in last place when it comes to vehicle greenhouse gas emissions. According to a
recent report by the Union of Concerned Scientists, Ford has "the absolute worst heat-trapping
gas emissions performance of all the Big Six automakers."
Despite the company's recent green washing PR campaign, its record has actually worsened.
According to Ford's own sustainability report, between 2003 and 2004, the company's US fleetwide fuel economy decreased and its CO2 emissions went up. Ford has also lobbied against
lawmakers' efforts to increase fuel economy standards at the national level and is also involved
in a lawsuit against California's fuel economy standards.
Consider an infamous case that, when it broke, had all the earmarks of conscious top-down
corruption. The Ford Pinto, a compact car produced during the 1970s, became notorious for its
tendency in rear-end collisions to leak fuel and explode into flames. More than two dozen people
were killed or injured in Pinto fires before the company issued a recall to correct the problem.
Scrutiny of the decision process behind the models launch revealed that under intense
competition from Volkswagen and other small-car manufacturers, Ford had rushed the Pinto into
production. Engineers had discovered the potential danger of ruptured fuel tanks in
preproduction crash tests, but the assembly line was ready to go, and the companys leaders
decided to proceed. Many saw the decision as evidence of the callousness, greed, and mendacity
of Fords leadersin short, their deep unethicality.
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But looking at their decision through a modern lensone that takes into account a growing
understanding of how cognitive biases distort ethical decision makingwe come to a different
conclusion. We suspect that few if any of the executives involved in the Pinto decision believed
that they were making an unethical choice. Why? Apparently because they thought of it as purely
a business decision rather than an ethical one.
Taking an approach heralded as rational in most business school curricula, they conducted a
formal cost-benefit analysisputting dollar amounts on a redesign, potential lawsuits, and even
livesand determined that it would be cheaper to pay off lawsuits than to make the repair. That
methodical process colored how they viewed and made their choice. The moral dimension was
not part of the equation.
LEARNINGS
Henry Ford is one of the most famous businessmen of all time. American industrialist and
founder of the Ford Motor Company, his foresight revolutionized the transportation industry and
enabled many people to purchase their first car.
But what relevance do Henry Fords methods and work ethic have today? What can a one
hundred year old process teach us about being better entrepreneurs and business owners in the
modern age? Well, perhaps surprisingly more than you imagine.
In this post I want to highlight some of the methods Ford applied to his business endeavors and
look at how they can help us all become more successful.
Innovation = Success
Innovation without execution is just hallucination. ~ Henry Ford
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At the start of the twentieth century Henry Ford brought the assembly line technique to the world
of automobile production. The technique was so successful it allowed mass production on an
unparalleled scale.
However, it is important to remember that Ford was not an inventor; he was an innovator. He
did not invent the automobile or the assembly line but he did revolutionize the way in which they
were produced and utilized. He had the vision to take something which already existed, improve
it and re-sell it as something new.
This can serve as an important lesson to anyone who is stuck for ideas, as he proved that
reinventing the wheel (no pun intended) isnt necessary when modification and improvement
can serve us equally as well. Its about having belief in the power of professional vision and
understanding how to capitalize on opportunities.
Great entrepreneurs not only put ideas in motion but they commit to them mentally as
well. Having an amazing idea is all well and good but seeing it through to the implementation
and execution phase is just as important.
As well as identifying your target market it is also vital to keep in mind the importance of
promotion and how you sell your services or product.
When the Model T Ford was introduced on October 1 st 1908, Ford set about creating a huge
publicity campaign that would ensure every available newspaper would want to carry stories and
adverts about the new product. A combination of clever marketing and a rapidly growing positive
reputation meant that by 1918, half of all cars owned in America were Model Ts.
Obviously we are talking about a much smaller scale here, but how you engage with potential
clients and customers is just as relevant. Having a good website, regularly updating your blog
and keeping up a strong presence across social media sites are all ways in which you can selfpromote at very little cost. Something as simple as overhauling your company About page or
writing a guest post for a relevant site can help to give your business a boost.
Failure is simply the opportunity to begin again, this time more intelligently.1
Failure is something that will come to all of us at some point but it is how you deal with it that
sets you apart from everyone else. Henry Ford actually had two motor companies before Ford.
Both failed and resulted in bankruptcy but he had the determination and belief in his idea to
carry on. He sucked up his mistakes and learned by a process of careful observation and trial and
error.
Efficiency is King
Ford was a huge believer in the power of working efficiently. Today he is credited with the
modern concept of Fordism. Fordism is a system based on an efficient, standardized form of
mass production.
In short, Ford realized that by keeping the efficiency of his workers at a premium level he
could achieve the maximum level of output. He achieved this by incentivized loyalty through
better wages and a reduced workweek.
But hold on doesnt that sound a little familiar to us as businesspeople? As entrepreneurs we
strive to work the minimum number of hours for the maximum reward. As weve discussed
previously, by eliminating inefficiencies you can increase your proportion of billable hours
which ultimate results in a higher equivalent hourly rate. As the 80/20 Principle teaches us, 20%
of the input creates 80% of the output, or in simpler terms: targeted, effective work beats
generalized, hard work every time.
For us this is a good reminder of the importance of learning and adapting to trends within our
chosen industries. An idle moment could mean a missed opportunity.
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