Business Level Strategy Analysis: Ford's TQM Implementation

This report provides an in-depth analysis of Ford Motor Company's business-level strategy, focusing on the implementation of Total Quality Management (TQM) tools. It explores the use of benchmarking and Six Sigma methodologies, detailing their application within Ford's operations to achieve competitive advantages. The report examines the various stages of benchmarking, the DMAIC model, and how these techniques contributed to cost reduction, quality improvement, and enhanced customer satisfaction. It also highlights the organizational changes and benefits resulting from TQM adoption, including improved efficiency, reduced waste, and increased profitability, ultimately demonstrating how Ford leveraged TQM to become a consumer-driven company.

Running Head: Business Level Strategy
Business Level Strategy

Business Level Strategy 1
Contents
Introduction.................................................................................................................................................1
TQM.............................................................................................................................................................1
Tool used by Ford........................................................................................................................................2
Implementation of tool used in organization..............................................................................................2
Techniques of total quality management in ford........................................................................................3
Benefit of TQM in organization...................................................................................................................5
Conclusion and Recommendation...............................................................................................................6
References...................................................................................................................................................7

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Introduction
Ford Motors Company popularly known as Ford is an American multinational automobile
company. The company was originated by Henry Ford in the year 1903; the organization is
headquartered in Michigan. The company is known for selling automobiles and commercial
vehicles under the brand name of Ford and selling luxury cars under the brand name of Lincoln.
The large scale manufacturing company supplies its products worldwide and has a diversified
business; also it is known as world’s fifth largest organization selling automobiles. Apart from
that, the services which the organization provide is leasing and service, and automotive financing
(Ford 2017).
Aim and Objective
The aim of this task is to provide analyze Total Quality Management tool which Ford Motors
used in their business process. The organization used benchmarking and six sigma tool in their
operations to gain competitive advantage in the target market. Further details about the task are
discussed below:
TQM
Total quality management explains the managerial approach which identifies the long-term
success of the organization by the way of customer satisfaction. In the process of TQM, all the
members of the organization come together with a motive to improve the process, product and
service and the culture provided by the organization (Dale 2015). Further, there are eight primary
elements which form the whole process of total quality management in an organization, these
elements are discussed below:
 Customer centric: the customer is ultimately the kingpin of the market; all the activities
happening in the internal process of the organization are implemented in accordance to
the customers only.
 Total employee involvement: this approach needs the involvement of all the employees
present in the organization. High-performance work can only be implemented when all
the employees continuously contribute to the business operations (Sallis 2014).

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 Process-centered: the fundamental part of TQM is process thinking. The management
aims to solve the issues through innovation and monitoring the growth.
 Integrated system: as discussed above that it involves whole employee engagement, so
shall be said that the process is an integrated system.
 Strategic and systematic approach: the tools of the management implement strategic
approach and implementation plan in the organization for the purpose of success.
 Continual improvement: the major thrust behind implement this process is to improve
the management of the organization in global context (Goetsch, and Davis 2014).
 Fact-based decision: making: in order to analyze the growth of the organization, the
process initiates performance measurements on the basis of which decision-making
process implemented.
 Communication: it is aspect which plays the key role in implementing all the activities
in the management (Yazdani, et. al., 2016).
the purpose of this report is to provide a brief overview regarding the TQM tool used by the
organization Ford in order to initiate competence in the organization, further details about the ask
are discussed below:
Tool used by Ford
Looking at the attributes of the organization, it was analyzed that the benchmarking tool of the
total quality management which supports the management activities and helps the company in
winning the competition in the international market. Benchmarking tool helps the organization in
identifying, sorting, and displaying possible outcomes of a specific problem. The process
identifies and applies best demonstrated practices in the sales process of operation. Under this
process the manager compares the value of their product with the other product present in the
market and on the basis of those internal and external operations the business drives their
activities as well (Sabet, Adams, and Yazdani 2016). The organization needs to find the activities
which the superior business is preforming and understand them and apply them to the business as
well.

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Implementation of tool used in organization
Robert Camp developed the benchmarking approach in twelve stages which defined the process
of how the organization Ford used this approach in their business operations. Aim of the Ford to
apply such strategies in their business process is to cut the cost and add equipment to connect
cars to the internet. And also, improve the fuel economy and safety of customers in the
organization. Further the implementation of benchmarking in Ford is discussed below:
 Planning: under the process of planning the organization identified the broad business
process and tasks which are to be benchmarked by the organization. Ford identified the
areas where the organization needs to implement adequate changes. As per the objective
of the organization, they wanted to cut the cost and maximize the satisfaction level of
customers of the organization. Thus, the organization planned their process of
benchmarking accordingly. Further the plan also included the key process indicator on
the basis of which the organization shall monitor the performance (Oakland 2014).
 Analysis: in this process of analysis Ford identified the areas which require the attention
of the organization. In this process the organization gathered the information from the
suppliers present in the target market and identified the areas which are distressing the
interest of consumer from the product. They initiated their focus on Fiesta and Focus to
benchmark and redesign.
 Action: in this process the organization communicated the result with the stakeholders of
the organization. And on the basis of that result they developed an improvement plan
which would analyze the changes and act accordingly. As per the plan defined, the
management monitored the progress and reviewed the necessary details accordingly.
 Review: under this process review of performance was initiated and bottlenecks were
rectified according to the continued plan. Further the organization analyzed the process
which the similar renowned firms are implementing and used them in their business
process so as to eliminate the problems and archive the objectives (Mehta, Verma, and
Seth 2014).

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Techniques of total quality management in Ford
The Ford motors used the total quality six sigma techniques with an aim to become fully fledged
consumer product, not just a company selling automobile products. Also, the management of the
organization aimed to enhance the quality of its products and increase the level of satisfaction of
customers as well. They named this approach as consumer-driven six sigma as their main focus
through this approach was to aim the customer support towards their product in the competitive
market. Furthermore, Ford was regarded as world first company which implemented the six
sigma plan in their business process. The major problem faced by the organization was that the
company faced more than 20,000 opportunities for the defects which were present in the
manufacturing process of cars. For this purpose, the management initiated the six sigma plan so
also control these problem caused in the internal process of the company (Pyzdek, and Keller
2014).
In this plan, the managers aimed to reduce the single defect per year on every 14.8 vehicles and
they also succeeded in their plan. And this success also satisfied the target of the organization to
increase the level of satisfaction of customers. Under this process the organization implemented
the DMAIC model in the following ways:
 Define: under this approach the organization defined the project stakeholder using the
SIPOC analysis (supplier, inputs, process, outputs, and customers). This process led to
creation of three groups that are internal, external and mixed group which involved both
internal and external customers.
 Measure: the organization introduced various measurements on the basis of which
analysis was implemented. The questions are listed below.
 Daily basecoat consumption.
 Paint film thickness check.
 Consumption per automated painter.
 First-time through rate versus consumption
 Damage problems (Dale 2015).
 Analyze: under this analysis the six sigma team of the organization conducted the 5 why
analysis and initiated tests and trials on potential root cause. The results measured that

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from above aspects only one feature showed significant increase while other remained
same. Thus, in this way the analysis of the above mentioned facts was made in ford.
 Improve: in the next aspect of improve, tools like value streaming, cause and effect
diagram, statistical data etc. were used to rectify the deviations caused in the plan and
fulfill the desired plan. The robot issues were rectified by using the benchmarking
techniques in the manufacturing process (Oakland 2014).
 Control: according to the new plan, new monitoring controls and standards were
implemented in the organization so as to retain the growth in the organization. Control
process was implemented so as to maintain quality management in the organization.
Success of tools
Talking about Ford’s success in through the total quality techniques it shall be noted that with the
use of techniques like six sigma, the organization eliminated the major problem affecting the
innovative growth of the organization. Ford also managed to reduce the emission of waste up to
$ 2. 19 billion in year. With the use of lean six sigma techniques such as data driven, problem-
solving process approach etc. solution was recommended by the employees to reduce the
emission of raw material waste in the manufacturing process of the organization. Also, the
methodologies which the company decided for the purpose of improving the quality and
eliminating waste impacted the operations of ford positively (Furterer 2016).
Furthermore talking in monetary term also it shall be noted that organization gains more and
more customers in a year after the initiation of this process. Also, due to reduction in wastage
less material was occupied by the organization resulting to increase in profit margin. Afterwards,
the company aimed to maintain the improvement process initiated in the organization which
became the habit of Ford. This habit of the organization helped them to initiate sustainability in
long run. Also the most important aspect due to which the quality management tools and
techniques were used that is customer satisfaction was also achieved and increased with an
optimum speed. The deep rooted problems were analyzed by the management and the team
worked on them to eliminate it from the process (6sigma 2017).

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Change in organization
This fact cannot be ignored that with the process of initiation of six sigma in Ford, the
organization had to adopt many new changes in their management practice. But it shall also be
understood that the success of the tool and techniques were dependent on the internal process of
the organization. Thus the organization efficiently dealt with the change in the organization.
Further, the organization used the change management strategies to apply such changes in the
organization. The organization implemented the change in the following ways:
 Make change familiar: the managers circulated the employees with the change present
in the organization. They initiated top to bottom communication for the purpose of
spreading the change which they want to implement and by what means and why.
 Afterwards, initiated bottom-up approach of communication to seek opinion of employee
for the changes. The employees provided brainstorming ideas to implement such change
effectively in the organization (Goman 2017).
 Lastly, the managers trained the employees with the total quality management tools and
techniques. This helped the employees to easily adopt the change and implement them
with adequate strategies in the organization. They engaged them in the change process
which helped the employee to become a part of the team and work in favor f the
organization.
Benefit of TQM in organization
The below-mentioned aspects were positively affected by the activities of TQM in the company.
 Cost reduction: earlier the prices of the products were not affordable by all groups of
people present in the target market, but with the implementation of TQM plan, the
organization was no longer using resources which were not mandatory for the production.
This process resulted to decrease in the prices of products in the market (Sadikoglu, and
Olcay 2014).
 Improving quality: the quality of the products placed in the market was improved as the
management analyzed the obstacles hindering the growth and eliminated them with
adequate solution. Although ford is always known for delivering adequate quality in
products and services in the organization. But with the aim of achieving perfection,

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employees of ford created astonishing products which helped them to gain competitive
advantage in the market (Lasrado, and Lasrado 2017).
 Increase in customer satisfaction: lack of customer satisfaction was a critical issue in
the organization, so this process aimed to meet the demand of customers present in the
environment. The tools of total quality management analyzed the taste of customers
present in the market and their expectations from the product. The organization altered
their product accordingly to generate greater satisfaction of customers. As the quality
increases the satisfaction level of customers automatically increased (Fonseca 2015).
 Lowering environmental impact: the tools helped the organization to reduce the
emission of hazardous gases which can adversely affect the health of environment.
Considering this fact the organization reduced the emission of waste in the organization
they also manufactured electronic cars which worked through electric energy and emitted
less carbon.
 Employee engagement: the process of total quality management helped the organization
to become a part of the activities of the business operation. This process increased the
process of communication in the organization. As the tools of TQM involved co-
operation and co-ordination of all the employees in the organization, due to which they
learned the habit of teamwork which helped the organization in its sustainable
development (Mitra 2016).
 Training: as all the employees were not aware of the tools and techniques of total quality
management due to which the senior delegates trained the employees so that the process
can be initiated efficiently. Thus, the company Ford earned the benefit of developing the
skills of employees by training them with the process of six sigma, cause and effect etc.
 Global Competitive Edge: as discussed above, with the help of this technique
implementation, Ford reduced the prices of their product in the target market and also
decreases the waste products through manufacturing process. Thus, it shall be noted that
with the attainment of such attributes in the organizational culture, the company easily
gained the competitive edge in the target market (Attafar, Shahin, and Kheradmandnia
2016).

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Conclusion and Recommendation
Thus, in the limelight of above mentioned events the fact that shall be noted is that with the use
of total quality management techniques in the company Ford, they were able to eliminate their
inefficiencies and converted them into producing output for the organization. Also, Ford reduced
the prices of their product in the market and increased the level of satisfaction of employees by
improving the quality of their products (Shi and Zhou 2009). Thus, it shall be considered that
with the help of benchmarking tool and six sigma techniques of total quality management, Ford
gained competitive advantage in their target market. Further, the recommendations to the
organization are discussed below:
 It shall be recommended to ford that they shall aim to continue the total quality
techniques implemented in the management of the company. It shall become a habit of
the company to initiate activities in such a way that it provides competence to the
company (Jaeger, and Adair 2016).
 As the employees of the company are fully invested in the activities of the company, so
the management in return shall also provide them benefits so that they are motived and
interest in the activities of Ford.
 With the aim of creating sustainability, Ford shall create a benchmark for the carbon
emission in the organization. The employees shall be restricted to work under that it only.
 Lastly, it is recommended to the management of Ford Motors that as the company is
called for initiating innovative development in the organization, so they shall develop
strategies to monitor the innovation in the organization. As innovation can negatively
affect the growth of the company thus, they shall develop measures to prevent deviations
in their plan.

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References
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https://www.6sigma.us/uncategorized/six-sigma-case-study-ford-motors/>
Attafar, A., Shahin, A. and Kheradmandnia, M., 2016. The impact of TQM practices on
organizational learning case study. International Journal of Quality & Reliability
Management, 33(5), pp.574-596.
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Dale, B., 2015. Total quality management. John Wiley & Sons, Ltd.
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quality paths. International Journal for Quality Research, 9(1).
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Furterer, S.L. ed., 2016. Lean Six Sigma in service: applications and case studies. CRC
Press.
Goetsch, D.L. and Davis, S.B., 2014. Quality management for organizational excellence.
Upper Saddle River, NJ: Pearson.
Goman., C. K., 2017. 10 Change-Management Strategies That Are Backed By Science.
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Jaeger, M. and Adair, D., 2016. Perception of TQM benefits, practices and obstacles: The
case of project managers and quality management representatives in Kuwait. The TQM
Journal, 28(2), pp.317-336.

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