Ford -Lscm Final
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Transcript of Ford -Lscm Final
![Page 1: Ford -Lscm Final](https://reader035.fdocuments.net/reader035/viewer/2022081813/55cf9008550346703ba29090/html5/thumbnails/1.jpg)
CASE ANALYSIS
Ford Motor Company - Supply Chain Strategy
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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 Luxury cars
under Lincoln brand.
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About the Case
• Discusses about Ford’s 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 shareholder’s 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.
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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 ?
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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.
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• 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.
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• Partnered with Chrysler and GM to work on automotive network exchange (ANX) – aimed at consistency in technology standards and better coordination with suppliers.