Ford Motor Company's Operations and Supply Chain Management

The assignment analyzes Ford Motor Company's operations and supply chain management, focusing on quality management and plant location/layout. Recommendations are provided to improve these aspects, including setting parameters for quality management and researching geographical conditions for plant locations. The essay also draws from case studies and research papers on logistics and supply chain management, highlighting the importance of sustainability and carbon emission reduction in modern business practices.

UNDERSTANDING
OPERATIONS, LOGISTICS
AND SUPPLY CHAIN
MANAGEMENT

Table of Contents
INTRODUCTION ...................................................................................................................... 1
MAIN BODY.............................................................................................................................. 1
Overview................................................................................................................................. 1
First topic: Managing Quality ................................................................................................. 2
Second Topic: Location and Layout .......................................................................................4
Triple bottom line.................................................................................................................... 6
CONCLUSION............................................................................................................................ 6
RECOMMENDATION .............................................................................................................. 7
REFERENCES............................................................................................................................ 8

l壱INTRODUCTION
Any business organization that produces products and services, operations is there main
part. Products are physical items which needs raw material, parts, assembling them like a car
which needs raw materials like steel, parts like engine etc. and assembling of those parts.
Services are the activities that are provided to customers regarding their products(Luthra, Garg
and Haleem., 2016). Management of all the operations in the business is called operations
management. Operation management is responsible for managing all the processes, systems that
are used to create product or provide service. Supply chain is the system of activities, people,
organisation, resources and information involved in moving any service or product from
suppliers or organisation to customers. Supply chain involves transformation of raw materials,
natural resources and components to deliver the final product to the customer. Logistics is
basically management and flow of different products from one place to another. It is normally a
sub part of supply chain management. In this essay brief overview of Ford Company and its two
main areas i.e. managing qualities and location and layout in detail(Slack and Brandon-Jones.,
2018).
l壱MAIN BODY
l弐Overview
Ford motor company is a multinational automaker company based in America with
global presence. It sells commercials, automobiles and luxury car vehicles. Ford owns 8% stakes
in UK based company Aston Martin with joint ventures in different countries like in china
Changan Ford, in Thailand AutoAlliance Thailand etc. Ford has subsidiaries in UK known as
Ford of Britain which is a subsidiary of Ford motor company(Christopher., 2016). Ford of
Britain operates in three different manufacturing sites in UK i.e. petrol engine production,diesel
engine production and transmissions. It also operates in large R&D facility in Dunton which
employees more than 3000 engineers. It is one of the largest car and commercial vehicles selling
brand in UK.
Quality management is important in Ford as it is the main factor for continuous
improvement in Ford through which they deliver top quality products and services to their
customers. They manage quality in their products through different processes, operations and

tools like quality operation system, product development system, launching new models,
integrating teams in product development, manufacturing, marketing, purchasing, sales and
services etc. and working with them.
Location and layout has a big impact on any company like Ford. Location of the plant or
manufacturing should be at a location where cheap labour is easily available, machinery can be
easily available and can be used. Layout of the plant affect the manufacturing of products of the
company. Like in layout of Ford engineering laboratory and workshop should be available for
product development. Publishing office and storage space is must. There are many more things
which should be kept in mind before designing the layout of a company(Govindan, Soleimani
and Kannan., 2015).
l弐First topic: Managing Quality
Quality is basically standard through which a product or service is measured and
produced. Quality management in any company is important specially in manufacturing and
production operations in a company specially in automotive industry like Ford. In ford large
number of cars and vehicles are produced so to ensure the safety of its products and services it is
important to maintain their products and services quality as it ensures the safety of derives who
drives the vehicles. So it is important to ensure mass production of vehicles while
manufacturing. Quality management is done and checked in Ford at different stages of
production i.e. when it is manufactured, when it is tested, when it is finished, when its parts are
manufactured and finished and when it is shipped to customers. At all these stages a level of
quality is maintained. Ford has a separate quality management team which ensures the quality of
product which is being manufactured and will be delivered to the customers. They do not have
separate subcontractors to do this job as they have the least control over the manufacturing in
this case and cannot monitor their work and quality. So they themselves check and maintain the
quality of the product. Ford apply few rules while manufacturing the products of their
production line like:
Independence and control: Ford has established an independent and unbiased quality
management team for monitoring the whole manufacturing system(Gallego-Álvarez, Segura and
Martínez-Ferrero., 2015).

Check points throughout the production process: Throughout the production process quality
management team test the production process and them move to next stage. Through which any
defect or compromise in product manufacturing is done then it can be identified and resolved.
Pass or fail grade: After testing at several stages when the final product is produced then
products are passed through final quality test where they are driven and tested and pass or fail
grade is graded to the product.
Visibility in quality: Complete quality testing is monitored and if anything goes wrong then it
is handled and manufacturing team is informed about the problem or a defect.
Test: At last vehicles goes through the final test which a car can bear and should go through
before it is allowed to hit the road. This test is important to be passed as it ensures the safety of
the driver driving the vehicle as well as people who are sitting in the vehicle.
Quality management in Ford can be Further improved by using Total Quality
Management Theory which says that it is a management approach through which quality of
products and services are maintained for customer satisfaction. This theory focusses on
integrating all the organizational functions like engineering, production, design, finance etc. to
meet customers' requirement and meet the objective without compromising with the quality of
the product. So to bring more improvement in quality management in Ford total quality
management model can be used which combines all the efforts of both employees as well as top
management of an organization to use effective strategies and policies to deliver high quality
products to the customers for customer satisfaction(Elnadi and Shehab., 2016). This model says
to focus on quality of product completely to excel in the production and selling of the products.
Total quality management also says that customer's expectations and customer's feedbacks are
one of the most important factor in implementing, formulating of any strategy and
manufacturing of any product so that product developed by the company is always superior as
compared to the competitors products and the organization can gain higher revenue and profits
for the organization(Wood and et.al., 2015).
TQM can be implemented in Ford in four steps i.e. Continuous improvement:
Whenever Ford needs to bring any improvement in the product according to the customers,
quality of product and processes should not be compromised and employees should starve for
zero defect and complete efficiency in all the processes. Improvement in all the improvement

required area should be in a proactive manner. Customer Focus: Organization like Ford should
Focus on both the employees working in their organization and customers because if their
employees needs will not be fulfilled then it will affect their efficiency of working which will
eventually affect the quality of product manufactured and customers exceptions will not be
fulfilled as manufacturing of a product is completely in hands of the employees involved in that
process. Team involvement: As in manufacturing of any vehicle many departments are
involved like finance, manufacturing, designing etc. so involvement of all the team members is
important for a quality product. It is important to create an atmosphere for all the employees to
work together as a team so that all the weakness of the team is identified and can be handled.
Data driven: At last tools or software should be used for employees to identify quality issues
and proper initiatives can be taken.
l弐Second Topic: Location and Layout
Whenever a company wants to set up a manufacturing plant specially in automotive
industry like Ford location of the plant and its layout is one of the most important thing that
should be kept in mind. Plant location is one of the most important decision that is taken by the
organization through which manufacturing of products is done easily and effectively and
delivered to the customers. Location of the plant should be selected in three steps: Firstly a
particular region should be selected where company can easily follow legal environmental
government laws, labour is easily available, there is no technological and marketing issue. Then
a particular location within that specified region should be chosen where site can be planted. At
last dimensional analysis should be done i.e. at what square foot pant should be, selected area
should be of less cost. They should also consider that that area is any hazard and accident prone
so that there is no hindrance in the manufacturing of the product(Pfau and et.al., 2014). Then
layout of the plant comes into picture which is physical arrangement of pant is done i.e.
arrangement of machines, equipments, engineering department, service department etc. are done
effectively and efficiently by keeping in mind 4M's i.e. machines, men, methods and materials.
Layout of a plant should be designed in such a way that overall cost of equipments and
operations is minimized(Jabar and Alnatsha., 2014). Layout of any automotive industry is
designed then Few things should be kept in mind i.e. transportation of product from one
operation to another can be controlled effectively and efficiently, finished products or raw

materials can be easily moved from one workstation to another, space should be more efficiently
used, unnecessary investment should be avoided, supervision can be easily done, for future
expansion space should be available. Ford has many manufacturing plants and all are planted
and designed according to following points like: new plant is only planted if there is a
requirement of the new plant, all the plants available are at hazard prone areas, they have also
reduced there total investment and are designed in such a way that all of their plants contains an
engineering department, service department, manufacturing department, testing department,
storage area etc.
They can bring improvement in there locations and layout by following Alfred Weber's
theory of location, and layout Grid theory. Alfred Weber's Theory of Location, this theory
helps in finding an optimal location with minimum manufacturing cost. This theory tries to find
location based on minimum transportation cost and easily availability of labours and for that it
analyse three factors i.e. first optimal transportation for the distance cost to weight of raw
materials and finished goods. Second is favourable sources through which lower cost labour is
avail be which can justify transportation cost. Third is Agglomeration or concentration and
another is degglomeration. Both Agglomeration and degglomeration can be explained as
Agglomeration of an organization occur where there is demand of service and labour force.
Companies like ford prefer close contact with their customers. While degglomeration occurs
when there is shortage of labour, affordable land, capital etc. For automotive companies capital,
labour, land are more important to set up a plant. Keeping in mind all the three factors location
of manufacturing plant can be selected. After location is selected layout of the plant is important
for smooth functioning of plant and future expansion and for this layout Grid theory can be
used. Grid is an important tool for designing a layout of a manufacturing plant(Pho and Tambo.,
2014). Specially for automotive companies designing and engineering and architecture is
important for plantation of a plant. Am of this theory is to design an optimal layout considering
grid, space available and required units. In automotive industry layout is not only for
manufacturing plant but it is also for designing of a vehicle. Whenever designing a layout for a
automotive industry plant all the required departments, storage areas, availability of space should
be kept in mind. And if designing a layout for a vehicle all the factors like space required, parts
locations and fitting etc. should be kept in mind before designing a layout of vehicles. At last it

can be said that use and success of a manufacturing plant with optimal use of capital with
required labour completely depends upon the location and layout of the plant and Ford should
follow both the theories before planting any new manufacturing plant at any location.
l弐Triple bottom line
There are three factors of sustainability in business practice like- economic,
environmental and social factor.
Environment: Environmental factor is a factor which often gets more attention. Nowadays
almost all the organizations especially automotive industry organizations like Ford are focusing
on carbon footprints, water usage, packaging waste reduction and also focusing on reducing the
overall impact of their products on environment. Companies focusing on having a positive
impact on earth can also experience positive financial impact(Harvey., 2017). Companies can
also try to use available resources without disturbing the integrity of ecosystem so that
environmental burden can be reduced. Companies need to focus on all these factors though it is
not easy to calculate overall cost of carbon dioxide, waste in general or land reclamation etc. still
they should think about these factors.
Social: Social factors are also one of the most discussed factor in today's date. For a sustainable
business support and approval of its stakeholders, employees or the community they are
operating in. this factor focuses mainly on treating employees fairly, being a good community
member and good neighbour both globally and locally. On global level they need to be aware of
how their supply chain is being filled. They also need to focus on are all the employees working
in their company being paid and treated fairly(Lin and et.al., 2015).
Economic: It is also one of the most important factor for a business to be run smoothly. This
factor generally focuses on efficiency of technological and economic activities, productivity and
investment, economic output potential and economic growth. Activities under this factor are
governance, compliance, risk management. To remain sustainable business must be profitable
but side by side should also focus on the other two factors as well.
l壱CONCLUSION
From the above essay it has been concluded that quality management in an organization
especially in automotive industry like Ford is important, as it ensures the safety of vehicles

and the people driving it and sitting in it. If quality of a product is not good then it can also
affect the sales of the product as well. For this total quality management theory has been used.
Location and layout of a company affects the manufacturing of the product, capital and budget
of the company. For this two theories has been used i.e. Alfred Weber's theory of location, and
layout Grid theory.
l壱RECOMMENDATION
With respect to the above essay there are few recommendations for Ford motor company.
First is regarding managing quality of the products, Company can set some parameters rules and
regulations for the quality management which all the departments of the organizations need to
abide by weather they are from manufacturing department, production department, sales
department or from quality department itself.
Second is regarding location and layout for plantation of manufacturing plants. Company can
focus on geographical condition of that country or region where they are thinking of planting the
manufacturing plant i.e. weather that region is hazard prone or their economic conditions are
stable. They can also research on the unemployment rate in that region for finding labour for
their manufacturing plant or not.
l壱

l弐REFERENCES
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