Ford Company: Organizational Structure, Functions, and Analysis

This report provides a detailed analysis of Ford, an American multinational auto maker, exploring its organizational structure, including private, public, and voluntary organizations. The report examines the size and scope of different organizational types, their legal structures, and objectives. It also i...Read More

Akhtar Hussain
S0285204
Business and Business
Management
[4874]

Table of Contents
INTRODUCTION...........................................................................................................................1
Different types and purposes of organization including private, public and voluntary.........1
Size and scope of different types of organizations.................................................................2
Relationship between different organizational functions and their link with organizational
structure and objectives..........................................................................................................4
PESTLE analysis....................................................................................................................7
SWOT analysis of 2 organizations.........................................................................................8
Interrelationship of internal factors with external factors....................................................11
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................14

INTRODUCTION
Business environment is a combination of both internal and external factors that impacts
on the company in positive and in a negative manner (Bah and Fang, 2015). This study is based
on Ford which is an American multinational auto maker public company. Its headquarter is in
Dearborn, U.S. It was founded in the year of 1903 by Henry Ford and provide services to
worldwide. This present study is going to show different types of organization such as private,
public and voluntary. These types of organizations have different purposes, business size,
number of employees. The size and purpose shows and help an individual to identify the type.
There is also a difference between legal structure like board of director, organizational structure
etc. Further, it will also show importance of business functions and their interrelationship. These
interrelationship impacts on organizational structure and decision-making process of the
company. Collaboration between organizational functions makes an organization able to
accomplish its goals. Lastly, it will show some internal as well as external factors like political,
social, strengths, weaknesses and environmental factors that affect company's operations and
performance in critic manner. Comparison of internal factors analysis like strengths,
weaknesses, opportunities and threats also makes an organization able to see and measure the
effectiveness of its performance.
Part 1
Different types and purposes of organization including private, public and voluntary
There are several organizations which may be private, public or voluntary. According to
the purpose, organizations are divided into 3 types such as private, public and voluntary.
Private: It refers those organizations and businesses whose preliminary aim and has
been set up for making money. It is owned by individual or group entities. It is also stated that
the revenue and profit generated by these organizations are reinvesting in the company and
distributed among different stakeholders (Badertscher, Shanthikumar and Teoh, 2019).
Operations of these businesses are based in multiple sectors such as food and retail, fashion etc.
They are more likely to make up a larger share of the economy in free market. Example of
private sector organization is: Ford which is an American multinational auto maker. Ford is a
publicly traded company.
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Public: It includes all those organizations who set up for the main purpose rather than
financial gain. It is differentiated from profit and private organizations because it works for
public benefits and not for making profit. Social and charities enterprises are some categories of
these type of organizations. The sums and amount generated by these companies are used for
public services and not are distributed in staff members. Some sectors in which they specially
operates includes: educational and regional sectors. These organizations may undertake some
business activities. For example: Crown prosecution services which is an agency which is
known for its supervisory legal advices given to police, CID and other investigation agencies
with the main aim reducing crime by identifying them in a timely manner. It is a non-ministered
government departmental type and a public agency.
Voluntary: These type of organizations are mainly NGO (Non governmental
organization) Who operate independently of government. It includes charities or social welfare
organizations whose main purpose is to provide services to vulnerable people and improve their
life standard. These type of organization, foundations and associations refers a group of
individuals who enter an agreement as a volunteer for providing services to vulnerable' people.
It is not necessarily voluntarily (Thornhill, 2016). For example: The British Heart foundation
which is a charity organization to UK. It funds research to beat heartbreak from heart diseases. It
is a charitable organization which is funded by legacies and wills, accounting for approximate
40% of their income and the rest is made up of other income.
All these described organizations may be micro, small, medium and large. It depends on
upn the purpose and number of employees as well as purpose. They have different legal
structure, size and scope. It may be sole proprietors, partnership and limited companies. Each
type of business need to decide on their legal structure as how will they operate which cannot
hurt anyone. The way of raising finance as well as their distribution etc. The main and common
aim of all types of organizations is to satisfy the society in which they operate and run. Private
organizations wants to make money and earn profit by satisfying its potential customers. On the
other hand, public and voluntary organizations also want to serve people and the society with
the main aim of improving their living standard.
Size and scope of different types of organizations
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Basis of difference Private Public Voluntary
Size and scope In the context of Ford,
it can be said that it
provides its services
worldwide except
Japan, Indonesia,
North Korea etc. It has
approximate 199,000
employees in its all
stores. The number of
employees show that
its is a large scale
organizations who
generate revenue in a
large amount as well.
Crown prosecution
services has
approximate 6,000
employees and annual
budget is approximate
£592 million. With its
number of employees
and budget it can be
said that it is a large
organization.
It is stated that The
British Heart
foundation charity and
voluntary organization
has approximate 3,000
employees and it is
also ranked 5th among
its top competitors.
Legal structure Its organizational
culture is vertical as
all authorities and
works from top to the
down. It has mainly 3
offices like chairmen,
executives vice
president and
president. Functional
heads are comes under
directly to the
supervision of the
executive vice
president.
The main
responsibility of this
company is to provide
legal suggestions and
advices. It sets out
basic principles which
are being followed by
prosecutors at the time
of case decision-
making.
In this context it can
say that trustee have
full authority and legal
responsibility for the
main action of BHF.
Members for this
charity are appointed
for a renewable term
for 3 years.
Products and In the context of It provides legal It is a charity whose
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services products and services,
it can say that this
company provides
automotive, vehicle
leasing and other
vehicle related
services. Its products
include: Auto mobiles,
commercial vehicles,
automotive parts, pick
up trucks etc.
advices to special
courts, police and
other criminal
investigation agency.
main purpose is to
provide funds to
people who are
suffering from heart
diseases and other
risks. Providing funds
and special care to
these people is the
main services.
How the structure, size and scope of different organization link to the business objectives
Different organizational structures like hierarchical, functional are being developed as
per the size and nature of the company. Different organizational structures shows the way of
performing activities. All these structures have direct relationship with organizational
objectives. For example, in the matrix structure, each department has 2 managers and boss by
which employees can take advice and suggestions. This way of performing activities help the
company in making an effective decision which helped them out in accomplishing their goals.
Relationship between different organizational functions and their link with organizational
structure and objectives
In the context of Ford's organizational structure it can be said that its structure is based
on business needs that differ market conditions. Its structure defines the way of performing
functions and their interaction with others. There are several benefits of its structure as it helps
this company in expanding its business and high performance as well. Its implement its structure
as per the regional market condition (Garson, 2017). The vision and objectives of ford which
can be accomplished by its functional department and its organizational structure are: to become
the world's most trusted company by designing smart vehicles. For designing smart vehicles
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there is a requirement of having skilled workforces, advanced technology and financial stability.
There are several organizational functions that has strong interrelationship and also help in
improving structure and accomplishing goals. Some organizational functions and their
interrelationship are described as follows:
Sales and marketing: Sales department is mainly responsible for increasing sales of the
company. An effective sales department is more than making sales. For selling more products to
customers they focus on research and try to add an extra value to products so that it prompts to
customers and dealers. On the other hand, marketing functions is also responsible for
influencing customers about buying products of the company. They need to attract more
customers towards buying products by introducing all features of services. Marketing
department collect several informations related to customers like their needs, features which
they want in products, current market trends etc. After collecting all these informations, they
give it to sales department for making sales function effective. This interrelationship show that it
helps the company in accomplishing their goals of making profits and improve organizational
structure (Taylor and et.al., 2015).
HR and finance: It is stated that finance and HR work closely for performing their
individual functions efficiently. Finance is all about money and costs and HR department with
people that affects the relations' between both departments. Both finance and HR department
work closely as they share one common goal of achieving higher level of performance and also
make company profitable. In the context of Ford, there is a requirement of skilled and
experienced employees which can provide excellent services to customers. For that, HR needs to
invest in training, development program. Recruitment process and for this cost it needs to
contact with finance department. On the other hand, finance manager also go beyond
considering employees as an important cost. They determine ways of improving profitability via
human capital and for that they focus on salary increment, bonus etc. This interrelationship
shows effectiveness of its hierarchical organization and its feature of global functional group.
Purchase and customer service: The main aim of purchase department is identifying
requirements of materials, services of Ford company, price negotiation and establishing order
quantity. For making an effective purchase of products for the company they also make an
effective combination of price, quality, payment terms and delivery speed. On the other hand,
customer service department focus on satisfying its customers by solving their queries and
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problems. Most of the queries are related to with the quality of products and services. For
solving this problem, they contact with purchasing department and give them all the
informations which customers want to improve in products, By making an effective connection
they try to accomplish company's goal of satisfying customers.
So, from above discussed functions and interrelationship it can be said that it supports
Ford's corporate hierarchy structure. There are some advantages of its organizational
structure that can be maintained and achieved by coordination of all functional departments. Its
global functional group maintain its hierarchy via its workforces and functional support. Its
regional geography division is one of the main feature which helps this company in
implementing strategies and policies in an efficient manner. Its regional geographical division
also help this company to take competitive advantages by covering all market around the world
(Lee, Kozlenkova and Palmatier, 2015). All these features of its corporate hierarchical structure
supports it to make ease of integration of business strategies.
Advantages and disadvantages of interrelationship between organizational functions
Interrelationship of different organisational fucntions give several benefits to the company. But
along with advantages, it has some limitations and disadvantages which are being discussed as
below:
Advantages:
 The main advantage of this interrelationship is it helps the company in making effective
decision.
 It reduces time of departments as it can communicate with other departments for getting
informations.
Disadvantages
 As all departments are interrelated so it can create problems such as failure of one
department can become the reason of other department. It can create barriers in
accomplishing goals and objectives of the company.
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Advantages and disadvantages of interrelationship of organizational functions and structure
Advantages of hierarchical organizational structure:
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Illustration 1: Organizational structure
Source: (Organizational structure of Ford Motor, 2015)

 The main advantage of corporate hierarchical structure is there is a clear chain of
commands.
 Specialization of tasks is other main feature.
Disadvantages:
 The main limitation of this structure is there is a poor flexibility in this type.
 Communication barrier is other disadvantage that create miscommunication and
conflicts.
Analysis of different types of business structures
Different types of structure have some advantages and disadvantage and has also
relationship with company's objectives. Some types are described below:
Functional: This type of structure is being divided into smaller groups with given
specific tasks. For example, an organization who has technological department, marketing and
other department works on different tasks. Advantage of this structure is employees are divided
as per the skills which help the company in performing tasks efficiently. Lack of inter
department communication is the limitation which creates barriers in accomplishing goals.
Divisional: Those companies who operate across horizontal objectives, use this
structure. It allows autonomy among groups. Each department own its resources and control
over the department. This type of structure allow more flexibility to employees. Limitation of
this structure is employees in different department work in the same project do not communicate
continuous which creates conflicts.
Matrix: It is a combination of functional organizational structure or projectized
structure. Employees have flexibility and are allowed to report to 2 managers. It solves critical
problems. On the other hand, it can create confusion of taking advices from 2 boss.
PESTLE analysis
PESTLE analysis can be defined as a tool that helps Ford in identifying opportunities
and threats by external factors. Its environment refers a global automotive industry. For
accomplishing goals, taking competitive advantages, it is important for this company to analyse
all these factors which can have impacts on its operations and decision-making making process
in both negative and positive manner. PESTLE stands for political, economic, social,
technology, legal and environment which all are described below in detail:
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Political: There are several political factors like changes in governmental strategies,
political stability of the country in which the company operates etc. In this context, it is stated
that governments are supporting automotive industry by putting pressure on them to innovate
their products and services with advanced technology. With the help of this support, Ford can
attract wider range of customers which can increase its sales. It is an opportunity for Ford. On
the other hand, in Europe there is instability of political situation which creating several barriers
in the path of the success of Ford (PESTLE analysis of Ford Motors, 2018). It is not in the
control of this company so now, it is more focusing on operating in those country whose
political situation is stable.
Economic: There are different economic conditions in different countries who give
opportunities and threats to the company. Stability and growth of U.S. economy is more stable
that is the biggest opportunity for Ford. In addition, it can also say that China and India who
have a large population and never ending demands gave opportunity to Ford to increase its sales.
On the flip side, strengthening U.S. Dollar and currency changes is a threat which is reducing
profit margin of this company. Many of the parts of automotive produced in U.S. Which needed
to be imported so, it can decrease profit margin.
Social: Social factors includes changes needs and trends towards automotive, attitude of
people about customers services and wealth gap. Ford in mainly known for its hybrid and
electronic auto mobiles and there is an increasing demands of both type of products. It is the
biggest opportunity for Ford as by producing and selling these products it can increase its sales.
There are some products of this company who are expensive and due to increasing wealth gap,
putting pressure on this company to reduce its prices which can decrease its profit margin
(Gibeaux and et.al., 2018.).
Technological: There is an increasing use of online services as customers prefer their
fulfilment of needs via online because its saves their time and travelling cost. It is stated that
Ford is focusing on satisfying these needs of customers for increasing loyalty and honesty. For
example, it delivers it's some parts to customers through enhanced online fulfilment services
which can increase its performance. It has strong financial stability by which it can invest more
in research and development and technologies which can make its products and services more
innovative. On the other hand, it has limited fuel station that can give negative impacts. It can
hamper its potential growth in providing fuel vehicles to customers.
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Legal: It is important for Ford and for all other companies to follow all legal
requirements for protecting itself from any lawsuit and conflicts. It is stated that, Ford is
engaging itself in sustainability by addressing impacts of environmental protection regulations.
There are several other regulations that are related to safety, Ford is trying to take opportunity to
improve and increasing sales of products by following safety regulations. It can also solve
problems related to fuel system and faulty parts which was the main problem for Ford.
Environmental: There is an increasing demands of hybrid and electronic vehicles
because they give low to 0 impacts on environment and its shows sustainability of the company.
Ford is one of those automotive companies who is known for hybrid and eco friendly vehicles.
By providing this energy efficient products to people of different countries it can attract wider
range of customers and make itself productive (Rastogi and Trivedi, 2016).
So, from the above factors and analysis, it can be said that Ford can take more
advantages by making changes in its strategies according to factors and their impacts.
SWOT analysis of 2 organizations
There are several internal factors that can also provide some opportunities and threats as
like external factors to the company. Internal factors are strengths, weaknesses, opportunities
and threats of the company by which company can modify its strategies as per the threats and
weaknesses for reducing them. In the context of Ford, it is stated that the success of this
company which made its able to make its position in the market is because of addressing
abilities by SWOT analysis tool. Some internal factors are described as below:
Strengths:
 The main strength of Ford is its strong brand image which is being recognized at global
level. The main reason of global recognition of this company is its effective marketing
and advertising function. Its brand value is approximate $12.74 Billion as per the report
(Ford SWOT analysis, 2019).
 It is also stated that Ford's products and services are not limited as it offers its diverse
products categories to different demographic group. It focuses on needs of all types of
customers and provide them variety of cars as well as commercial vehicles.
 Its other strength which helps it out in developing products is research and development.
With the help of this ability it is continuously trying to improve the performance of its
vehicle.
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Weaknesses:
 It is stated that Ford faced a huge loss due to its approximate 830,000 products recalls. It
also decreased its brand image and reputation as compare to European rivals. This
company had to replaced all these faulty product which decreased its sales and image in
the market.
 Other main weakness of this company is it is highly dependent on U.S. Market. It can
limit its profits. It requires focusing on other emerging market and make its position
because emerging markets are called never ending demands.
Opportunities:
 It is known for its hybrid and electronic vehicles and there is a huge demand of these
products due to its sustainability. So, it can increase its sales and take opportunity by this
ability.
 Digital marketing and fulfilment needs via online is other opportunity for Ford. By more
investing in digital marketing and technology it is engaging suppliers and customers.
Threats:
 There are several reputed companies such as: Tesla and Toyota which is increasing
competition for Ford (Liu, 2019).
 There is an increment in prices of raw materials of Automotive such as steel coin which
can decrease its profit margin and sales as well.
So, from above internal factors, it can be suggested to Ford that it should focus on
employing experienced and the right employees for increasing efficiency of operation
department.
In the context of, Crown prosecution services which is mainly responsible for examining
and analysing police evidence in order to decide if there is a requirement to take criminal
proceedings via court for supporting people. There are several strengths which makes it able to
give accurate and qualitative suggestions to police and other relevant branches. Some internal
factors of this public company are discussed as below:
Strengths:
 The main strength and ability of this organization which makes its successful is its
skilled employees or workforce. It is stated that this company has approximate 600
employees in which 1/3 of its employees are lawyers. These employees help this
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company in accomplishing goals by providing qualitative and authentic service to police
(SWOT analysis of Crown Prosecution Service, 2015).
 Other strength of this organization is introduction and implementation of computer based
system which is helping staff members in assisting in casework With the help of
computer based system, it is now dealing with complex cases which increases its brand
image in the market.
Weaknesses:
 The main weakness of this organization is its failure and ineffectiveness of
implementation of case management concept. This concept is all about team working by
different departments. The way of implementing was not good that lead a high degree of
dissatisfaction among staff.
 It is also stated that this organization discontinues prosecutions of about 12% of cases in
which police have charged. Some of their decisions went wrong due to lack of efficiency
and concern problems.
Opportunities:
 It is already stated that its workforce is experienced and skilled which helps it out in
achieving its pre determined goals and providing qualitative services. With the help of
this ability, it can take opportunity of improving brand image and opportunity to solve
critical case.
 Some rights has been given to CPS lawyers by audience in the Crown court by which it
can take opportunity of exercising these rights as soon as they can. Starting with
direction hearing it can make itself successful and greater efficiency (Popović and et.al.,
2017).
Threats:
 This organization deals with a wide variety of work and critical cases by which it cannot
deal with some areas and lack of efficiency give several problems to this.
 It is also stated that the government make some changes in laws by which it requires
making changes its policies in almost 40 areas. Making changes in all these 40 areas in
not an easy task. There is a problem created due to these changes is resistance of
employees of making changes.
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So, from above discussed strengths, weaknesses it can be said that, CPS should focus on
providing training to its employees and make them able to adapt changes and work efficiently.
There are several cases are critical by solving that cases, it can take several benefits. So, it
should make itself more able by making effective strategies and policies.
Interrelationship of internal factors with external factors
Internal and external environmental factors make business environment that has strong
relationship and connection. There are several internal and external factors that are interrelated
with each others which needs to be identified by Ford and other organization. The main aim of
identifying relationship is to reduce all those factors that give negative impacts and create
barriers in accomplishing goals. On the flip side, by identifying those factors that give positive
impacts, it can increase and make an effective use of all those factors (Islam and Mamun, 2017).
For example, There are several strength of Ford which makes it able to take some
advantages and make itself successful. The main strength of its company is its financial stability
and ability to research and development. This ability can help this company in taking advantages
of technological external factors. It is stated that there is a huge competition between rivals in
automotive industry. It is a big threat for Ford but with the help of strength and ability of
research and development it can make its products and services more innovative by identifying
needs and current trends of market. By using its strengths, it can decrease this threat and make
itself market leaders and strong position in the market.
Its strengths is it offer diverse products and different categories of products to different
types of people on demographic division. It supports its organizational structure as well. This
strength can satisfy social factors. As per the social factor there is a requirement to satisfy
customers changing needs and reduce wealth and age gap. Its strength and ability to offer
different categories of products and services to different age group of people satisfy social
factor. By which it can take opportunities of social factor and attract wider range of customers
towards buying its services. It also shows that its strengths and some external factors has strong
connection with each others.
There is relationship of weaknesses with external factors as like strengths. Weakness of
Ford which creates several barriers and problems in its success path is recall of faulty products
and dependency on one country and one market. Some external factors like legal factors which
put pressure on the company to follow laws related to safety, environmental protection and
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quality maintenance. If the company follows all rules and laws relevant to this industry then it
can decrease effects of this weakness. By following all regulations, it can protect itself from
recall of some faulty products. Its dependency on the one market decrease its sales and it can
also decrease opportunity of increasing sales and brand image in other market. U.S currency
change is now putting pressure on this company to focus on other markets which is an economic
factor. Their economic condition is stable but some changes are not favourable, So, it also
shows that some weaknesses and external factors are interrelated with each other (Toor and Luo,
2018).
CONCLUSION
From the above study it has been summarized that different types and purposes of
organizations played a vital role in satisfying customers needs. It has shown some functions of
an organization that has interrelationship with each other. Their interrelationship helped an
organization in accomplishing its pre determined goals like increasing sales, sustainability,
productivity etc. An effective organizational culture and structure make all functions effective
and successful. Further, this study has also discussed some external factors like political, social,
environmental that has positive and negative impacts on company's structure and profitability.
By analysing and implementing PESTLE analysis tool, organization made itself able to reduce
negative impacts and increase positive impacts. This assessment has shown some internal
factors of private and public organization which helped it in taking competitive advantages and
attract customers. By implementing SWOT analysis tool, organizations, reduces threats and
weaknesses by making changes in its strategies and policies accordingly. By analysing strengths
and opportunities it made itself more successful. Lastly, this study discussed interrelationship of
strengths and weaknesses with all external factors.
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Islam, F.R. and Mamun, K.A., 2017. Possibilities and challenges of implementing renewable
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