Ford Motors

CASE STUDY 2:

FORD MOTOR COMPANY: SUPPLY CHAIN STRATEGY

TABLE OF CONTENTS

EXECTUIVE SUMMARY 1

ISSUE IDENTIFICATION 2-4

ENVIRONMENTAL AND ROOT CAUSE ANALYSIS 5

ALTERNATIVES OR OPTIONS 6

RECOMMENDATIONS AND IMPLEMENTATION 7-8

MONITOR AND CONTROL 9

Conclusion 9

Exhibits 10

Executive Summary

In 1995 The Ford Motor Company launched a restructuring plan called Ford 2000 which reengineered and globalized corporate organizations and processes. Ford embraced internet evolution by launching its public website and intranet and put in place B2B capability. Ford also expanded its ownership in its distribution channel by acquiring either a minority or a majority of its dealership. They also teamed with Chrysler and GM to work on the Automotive Network Exchange (ANX) mainly to establish consistency in standards and processes in the supplier network. Ford was looking further into the utilization of emerging information technologies and how it could take ideas from high-tech industries to change their supply chain strategy.

My decision is for Ford to adopt Dell’s concept of virtual integration across its supply chain system from suppliers to its retail dealership network, while still maintaining its traditional model of supply chain (See Exhibit 1). Another approach I’ve decided on is to have Ford move its Purchasing Organization to fall under the Supply Chain Management umbrella. Currently it’s an independent and very powerful division but, I feel that we’ll achieve cost savings and process improvements by consolidating Purchasing under Supply Chain Management.

Issue Identification

The main issue as I see it are the differences of Fords supply chain system characteristics compared with Dell’s. This casts considerable doubt on whether virtual integration, similar to what Dell has implemented, could be applied to Ford’s supply chain system. The differences and or issues at hand are as follows:

Level of Complexities and...