Ford Motor Company: Managing Global Operations and Strategic Alliances
Added on 2023-01-19
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FORD 1
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Introduction
The environment engulfing international business is changing and becoming more
competitive and stiffer for companies to operate and compete favorably. Companies are
grappling with the challenge of retaining their competitive advantage to continue earning their
profits (Martin, et al., 2012). Ford Motor company is a market leader in the U.S.in the
automotive industry and has expanded its operations to more than six continents with over 70
plants distributed globally. The company has a population of more than 150,000 employees
globally and has been ranked as the leader in the automotive industry in both the U.S. and
Europe.
I-R model
The I-R model demonstrates the strategic choices for companies seeking to manage their
global operations with regards to two pressures that is the local responsiveness and international
integration. With regards to Ford, it employs the transnational strategy where it responds to both
local and international responsiveness simultaneously.
HQ versus Subsidiary
Adopting a different marketing strategy may influence HQ monitoring capacity. A
subsidiary that employs the standardization strategy gets less intensive monitoring, and HQ is
prompted to implement a soft monitoring form. However, a subsidiary that adopts an adaptation
strategy tends to be under constant monitoring, and HQ gets prompted to implement a harsh
monitoring strategy. Ford prefers using local marketing adaptations as their marketing strategy.
Ford’s HQ is intense and regular via its regulation framework, protocols and setting objectives.
Ford also depends on expatriates and indulges in information exchange in what is referred to as
Introduction
The environment engulfing international business is changing and becoming more
competitive and stiffer for companies to operate and compete favorably. Companies are
grappling with the challenge of retaining their competitive advantage to continue earning their
profits (Martin, et al., 2012). Ford Motor company is a market leader in the U.S.in the
automotive industry and has expanded its operations to more than six continents with over 70
plants distributed globally. The company has a population of more than 150,000 employees
globally and has been ranked as the leader in the automotive industry in both the U.S. and
Europe.
I-R model
The I-R model demonstrates the strategic choices for companies seeking to manage their
global operations with regards to two pressures that is the local responsiveness and international
integration. With regards to Ford, it employs the transnational strategy where it responds to both
local and international responsiveness simultaneously.
HQ versus Subsidiary
Adopting a different marketing strategy may influence HQ monitoring capacity. A
subsidiary that employs the standardization strategy gets less intensive monitoring, and HQ is
prompted to implement a soft monitoring form. However, a subsidiary that adopts an adaptation
strategy tends to be under constant monitoring, and HQ gets prompted to implement a harsh
monitoring strategy. Ford prefers using local marketing adaptations as their marketing strategy.
Ford’s HQ is intense and regular via its regulation framework, protocols and setting objectives.
Ford also depends on expatriates and indulges in information exchange in what is referred to as
FORD 3
cultural monitoring. Ford’s subsidiary in China uses the joint venture mode of operation as the
subsidiary has substantial knowledge about the market and particular local resources to make
adaptation possible and this leads to improvement of performance locally. The HQ thus imposes
robust monitoring to evaluate the subsidiary’s motive and streamline the strategy adopted by the
subsidiary with Ford’s corporate strategy. The subsidiaries by FORD support HQs and utilize the
knowledge they have about markets and local resources to assist HQ in making concrete
decisions. FORD also is involved in regional business activities and as such keeps in touch with
its subsidiary regularly.
Transnational strategy by Ford
cultural monitoring. Ford’s subsidiary in China uses the joint venture mode of operation as the
subsidiary has substantial knowledge about the market and particular local resources to make
adaptation possible and this leads to improvement of performance locally. The HQ thus imposes
robust monitoring to evaluate the subsidiary’s motive and streamline the strategy adopted by the
subsidiary with Ford’s corporate strategy. The subsidiaries by FORD support HQs and utilize the
knowledge they have about markets and local resources to assist HQ in making concrete
decisions. FORD also is involved in regional business activities and as such keeps in touch with
its subsidiary regularly.
Transnational strategy by Ford
FORD 4
Ford company tries to balance between standardization and customization of its
automobiles in international markets and handles the local market as a unique market that is
different from other global markets (Williamson, 2016). This has accorded Ford some degree of
automobile customization depending on the region where the vehicles are to be sold. For
instance, the North America market is characterized by trucks and muscle cars usually not part of
Ford’s portfolio in any other part of the world. Ford produces different vehicles in other regions
of the world based on the market needs of such markets. A good illustration is in 2011 when
Ford produced the Kuga that was initially for the European market and introduced it in the South
African market.
Management structure of Ford
The management structure adopted by Ford Motors company is based on both the
company and business needs that arise in different market environment across the world. Ford’s
management structure stipulates the configuration of Ford’s components and its mode of
association (Marx, 2016). Regarding Ford’s case, their management structure is directly
associated with the prevailing conditions in the global automotive business. The global scope of
Ford’s activities also stipulates the core organizational structure elements needed to withstand
intense competition and market risks.
Merging
Following the successful merging with Volvo, Aston Martin and Jaguar have enabled
such companies perform better in the UK. Such merging came with one common vision of
integrating the global suppliers, distributors and global employees in plan that would see them
emerge as global market leader in consumer automobiles (Martin, et al., 2012). The strategy of
Ford company tries to balance between standardization and customization of its
automobiles in international markets and handles the local market as a unique market that is
different from other global markets (Williamson, 2016). This has accorded Ford some degree of
automobile customization depending on the region where the vehicles are to be sold. For
instance, the North America market is characterized by trucks and muscle cars usually not part of
Ford’s portfolio in any other part of the world. Ford produces different vehicles in other regions
of the world based on the market needs of such markets. A good illustration is in 2011 when
Ford produced the Kuga that was initially for the European market and introduced it in the South
African market.
Management structure of Ford
The management structure adopted by Ford Motors company is based on both the
company and business needs that arise in different market environment across the world. Ford’s
management structure stipulates the configuration of Ford’s components and its mode of
association (Marx, 2016). Regarding Ford’s case, their management structure is directly
associated with the prevailing conditions in the global automotive business. The global scope of
Ford’s activities also stipulates the core organizational structure elements needed to withstand
intense competition and market risks.
Merging
Following the successful merging with Volvo, Aston Martin and Jaguar have enabled
such companies perform better in the UK. Such merging came with one common vision of
integrating the global suppliers, distributors and global employees in plan that would see them
emerge as global market leader in consumer automobiles (Martin, et al., 2012). The strategy of
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