Category: Business Essay

Ford Motor Company is an American publicly trading company which manufactures automobiles. It sells cars and commercial vehicles under two main brands, Ford and Lincoln for luxury cars. The company came into existence as of June 16, 1903. Today, it covers most countries in the world. The company’s vision is to make people work together as a lean global enterprise for automotive leadership; its mission is to have one team, one plan, and one goal. Thus, it measures its leadership by the degree of satisfaction of its customers, investors, suppliers, and employees.

Analysis, Composition and Evaluation

The main purpose of the company is to provide manufacturing, servicing, financing and marketing Ford cars. The company’s accessories, parts, vehicles and other equipment are sold through a wide range of dealers and distributors in various countries. The company sells it vehicles to commercial fleet customers, daily rental cars corporations, and government (Cao, Myers, and Omer). It also provides service contracts to dealers and customers. The company has various intellectual patents worldwide.

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As for the financial sector, the company provides financial services through its owned subsidiary known as FORD Motor Credit Company LLC, or directly Ford credit. This credit avails automotive financing products to and through automotive distributors and dealers worldwide. The main share of this company’s credit comprises the financing of the company’s vehicles and extending support to the traders. The company gets its revenue from the payment that is made under the retail installment sales and lease contracts, which accrue from the purchases, support payments from the company, interest rates, and subsidiaries.

The company’s strength is a geographically diversified revenue stream. A large amount of this endeavor’s revenue comes from North America, where there is an established market. It is approximated that about 52% of the Ford revenue comes from this area. Moreover, outside the domestic market, the company also has a well-diversified revenue stream as compared to its competitors.

The company’s has good opportunities to grow and expand through market penetration. This is because it employs improved marketing techniques and engages more distributors and dealers. With this, an opportunity appears to improve its financial standings through expanding its supply so as to achieve better economies of scale and reduce the production of costs (“Reception Booster). This further gives the company a competitive advantage over its rivals, since it can produce its products at a lower cost than the other players in the market.

Ford Company has also a good sustainability strategy through its quality control management, which ensures that there are no mistakes in the manufacturing process (West). This shows high safety standards of the company, as the company is building its reputation for safe vehicles.

However, Ford Motor Company has faced some major threats as well. For instance, it is slow in adopting the innovations. The scope of its production network combined with the present competition level, when not addressed appropriately, may lead to its failure. Rapid and aggressive innovation strategies are needed to curb this problem so as to remain in the market for a long time. The company is also faced with the threat that its inventories are not adequately monitored due to its large size. This inability will directly affect the financial capability of the company which may result in substantial losses.

The Importance of Social Media

Due to stiff competition in the market, every organization devices new ways to reach its customers and attract more potential clients. Recently, the Internet and social media have become one of the best ways through which the business entities advertise their products. This is because it brings people of different ages, cultures and status together, making it thereby a good point for advertisement.

With many people using the social media channels across the world, it has emerged as one of the powerful marketing and communication channels helping to raise and restore the company’s brands through directly connecting with the consumers. Social networking enables viral marketing and word of mouth promotion to be highly useful, since it gives a greater percent of consumer’s engagement. In the modern world, almost everyone is using the Internet and can view various products online. This makes it cheaper for the organization to reach their targeted audience (Carpenter and Lertpratchya). In the recent years, Ford Motor Company has employed the most sophisticated use of media, since they understood that it is not enough to just set up an account and post generic items once or twice a week, but intensive engagement of the customers in airing what they think is necessary.

In the year 2009, Ford Motor Company launched an innovative and a low-cost social media campaign on Facebook. This program was aimed at attracting young and newly qualified drivers to purchase the new, redesigned Ford Fiesta. This program was known as Fiesta Movement. The company invited a large number of people to apply to become Fiesta Agents. The successful applicants would be loaned new model Fiesta for six months in return for giving an honest post about the car on various social media. The application was made through Youtube, and one was required to explain why he or she wants to be a Fiesta agent.

As a result of this movement, the company gained over two million new Facebook and Twitter fans and over 50,000 requests for information about the new brand Fiesta and how it works. This movement was very successful for several reasons. First of all, the company used the guerrilla marketing techniques to capture the social media awareness. This generated a lot of anticipation among the consumers, hence attracting the attention of the society to the new brand in the market and making the customers experience the brand first hand.

The social media aids in increasing the loyalty of the customers to the company’s brand (Chu, Kamal, and Kim). This is because the customers want to interact with people and are not interested in the product features. With the help of social media, consumers are able to engage in a dialogue with characters, which helps in building trust. This calls for using the social media to interact with customers and not to announce the new products. A typical example is the “spokenspuppet”, a character that appears in Youtube to promote Ford Focus. Thus, Ford Company utilizes this feature of the social media to reach its customers.

Ford Company came to realize that social media commands higher brand authority. This is because interacting with the customers every time indicates a good faith for other clients. Some clients will compliment or even brag about the products. To gain assurance of the products, the customers will turn to the social media and in return will post about the same products to other audience, hence increasing the number of people who are aware of a specific product or service. Furthermore, the more people talk about a brand on the social media, the more valuable and authoritative the brands will become, attracting thereby new users.

The social media also helps in improving the customers’ insights. This is because it gives the company an opportunity to gain valuable information about what their potential and regular customers want, what they are interested in, and how they behave through interacting with the social media. For instance, Ford Company uses segments to see what their customers are thinking about them and make the relevant corrections to meet these needs.

Social media is far away from fading. It will continue to improve each day. A company that knows how to invest and manage its social media will attract more and more customers, thus retaining a broad range of clients, which will in its turn lead to a competitive advantage over its competitors.

Ethical Issues that Affected the Ford Company

Business entities of all types face ethical questions that determine their survival and sustainability in the market. More often than not, companies are faced with the uncertainties about their existence due to different external and internal factors. Therefore, to be able to survive in the market, the companies must set the rules that would help them in minimizing the risks that may cause the termination of the business. Although Ford Motor Company has a good reputation of ethical responsibility, it experienced a grave misconduct in the past. A good example of this is the Ford Pinto case. Ford Pinto was a vehicle that the company manufactured between 1970s and 1980s. The demand for this model was very high. However, it soon experienced some major problems. The gas tank in the vehicle was placed in a wrong way. The builders placed it on the rear axle instead of putting it in the back. The space between the gas tank and the axle was also tiny, so that its bolts could easily puncture the gas in case of a sudden hard rock or an accident. More so, there was also a high probability that the fuel filler pipe would pop out, spilling gasoline out in rear-end collisions.

In the following years, the number of passengers and drivers who used this model succumbed to death due to the explosion of the vehicle as a result of the rupture of the gas tank. Statistics recorded that about five hundred people died as a result of their gas tank explosion which caused the fire. Consequently, the company was sued for failure to prevent the situation from selling the vehicles. Grimshaw’s lawyer argued that the company knew about the flaw in the car but failed to change the design due to the high cost associated with the changes. The company was pleaded guilty and was obliged to pay the punitive damage of $125 million to the victims. Although this verdict was later changed, the case still had a negative impact on the company’s image.

This case soiled the company’s reputation as of an organization that is more concerned with profit making, and not quality. To win back its customers, the company had to address the issues of the Pinto Ford. The company came up with various safety measures and programs that controlled the fuel-fed fires in the cars in case they crashed or rolled over (Brown). This program included the fabric gas tank Ford, which enhanced the safety of the car users. The company recalled and modified the Pinto Ford using this program so as to ensure that its safety adhered to the standards of other models of its class.

Another big blow to the company was the cost benefit analysis. This came to light as a result of the Grimshaw case, which discovered that the company knew about the vulnerability of the Pinto but did nothing to change the design before releasing the model in the market due to the high cost that was associated with it. The company argued that the cost of changing the product was greater than the societal benefits, hence it allowed few people to die and some to get serious injuries at the cost of not changing the design of this model. This, in return, made the customers switch to other companies, which made the company recall the Pinto model and modify the fuel tank in an effort to bring back its customers.

Firestone was another ethical challenge that the company faced, and it had an adverse impact on the organization. This case was associated with the safety defect of the Firestones tires. The two companies had enjoyed a mutual relationship. However, a claim emerged that the Firestone tread had been failing. An investigation was carried out, which reported that the Firestone tires have been falling primarily on the Ford vehicles. This was another big blow for these companies. The companies accused each other of the failure. Thus, Ford accused Firestone of making low-quality tires, while Firestone accused Ford, claiming that Ford recommended the low pressure for its vehicles, and that low pressured tires increase friction, making the tire much riskier. Therefore, to ensure that the consumers do not migrate to other manufacturers, Ford Motor Company ordered a voluntary recall on millions of tires so as to increase the consumers’ safety.

Despite the problems that the firm has experienced, it has continued to dominate the motor vehicle manufacturing industry, and its name has become one of the most popular among the consumers. Its success can be attributed in large part to its efforts to fight uncertainties and maintaining the continuous social responsibilities, hence making the company reach its target audience. With this ongoing accountability and rigorous innovation, the company will continue to dominate the market year after year.

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