Case Study Ford Motor Company

1. List the various ways in which Ford has attempted to manage its environment over time.

Ford Motor Company, one of the big three automakers in the US, has changed over time. Gone are the days when one could buy a model T “in any color as long as it is black”. In its early days, Ford wasn’t an automaker per se.. It had various suppliers for different auto parts and simply assembled them together to produce the Ford brand. This approach to manufacturing did not come with its own problems. The primary concern with such approach is the management of quality. Ford had not control over the quality of products it received from suppliers. Ultimately, the quality and reputation of the Ford brand was hinging on the quality standards of others. The

American vehicles were known to be gas guzzlers. Those vehicles simply became too expensive to operate. Japan with its booming economy in the early 80s and fuel efficient vehicles entered the American market in a strong fashion. Prior to the 80s, the Big Three American automakers, GM, Ford & Chrysler, faced little if any foreign competition in the American auto market. The Big Three dominated the American Market and as oligopolies controlled the prices of the vehicles. GM set the price and the other two followed suite. Honda and Toyota products became very attractive to American consumers due to their fuel efficiency, style, and competitive prices. Protectionist policies of the Reagan era failed to shore up declining market shares of the Big Three. The US auto industry had to lay off workers. Anti-Japanese sentiments became rampant in the US. United Automobile Workers (UAW) union was behind the slogan “Buy American. The job you save could be your own”. To alleviate hostilities, the Japanese decided to open their own manufacturing plants in the US and employ American autoworkers. Thus, pulling the rug from under the Bog Three and UAW. Japanese autos became American-made which further gave Japanese automakers a larger share of the American auto market. To add to the misery of the Big Three, competing Japanese automakers supported by the

The design itself determines the organizational theory and how an organization chooses to deal with its external environment. The ability of Ford to obtain resources, attract skillful employees, loyal customers, adapts to new technologies or changing economic conditions and deals with laws and regulations are all functions of its design. When old designs became no longer valid or outdated, Ford has changed in order to affect its external environment in the most advantageous possible way. Ford’s success was manifested in the wake of the Global Financial Crisis of 2008 where it was the only US automaker who did not need stimulus money from the taxpayers to remain in business unlike its sisters GM and Crystler. One can arguably contributes this success to Ford’s quick adaptation and its employment of different methods at different stages of its existence to manage its