Ford Motor Company: Business Environment and Organizational Structure

This report provides a comprehensive analysis of Ford Motor Company's business environment. It begins with an introduction to the business environment, highlighting its dynamic nature and importance in analyzing opportunities. The report then delves into different types of organizations, including private, public, and voluntary entities, along with their respective legal structures. It explores Ford as a private sector company, examining its purpose, legal structure, and stakeholders. The report further discusses the size, scope, and relationships between organizational roles, including matrix, flat, and divisional structures. It also identifies the positive and negative impacts of the external environment, conducting both internal and external analyses to determine Ford's strengths and weaknesses. The report concludes with an overview of Ford's vision, mission, and key departments like HR, finance, marketing, and sales, emphasizing their functions and contributions to the company's objectives.

BUSINESS AND THE
BUSINESS
ENVIRONMENT

TABLE OF CONTENTS

INTRODUCTION
Business environment is the combination of both the inside and outside factors which
impacts the business. Moreover, it is dynamic in nature also helps in analysing the opportunities
which are present in the business environment. It also include all the forces which is used in the
internal and external side of the environment in order to control the business entity. Formation of
the business organisations are depends on its criteria such as nature, size of business and many
more (Erasmus, Strydom and Rudansky-Kloppers, 2016). It include various factors like client,
suppliers, betterment in application, social and economical trends and many more. Hence, all the
business companies need to aware about the alteration which takes place in the environment and
know how to deal with it. This report is based on Ford which is private sector company and an
American multinational automotive, headquarter in Michigan and was founded by Henry Ford in
1903. It is going to cover the various types of organisations and its legal structures. It also
explain the size and scope of different types of organisation and describe the relations between
the various organisational roles. Furthermore, it also identify the affirmative and antagonistic
consequences of external environment and organise internal and external analysis and also
identify the strengths and weaknesses of external surroundings.
TASK 1
P1.
Organisations are the collection of people who are collected in command to meet both the
individual and structural score (Fabuš, 2017). Hence, organisations are of three types:
Private Organisations: It is a corporation or agency which is runs and owned by a single or in a
partnership for profit. These organisations raise finances by themselves and also lend their vast
share in the transformation of economic system. They follow the concept and regulations of
authorities and also create their own in order to operate their business. For example, Ford Motor
Company which is an American international motor vehicle and incorporated in 1903. company
also sell automobiles and commercial vehicles.
Purpose: Their aim is to gain the profitability, develop the lucidity and also select the
suitable society for administration in bid to run their enterprise.
Legal Structures:

 Sole Proprietorship: This form of business operated by individuals and by considering
this, it has only one owner who is accountable for all the net income and financial losses
which are made with the purpose of business (Prajogo, 2016). This type of structure can
be seen in petite businesses where small finance is required in bid to build up the
business. It is considered as the easy form of business concern because and can be
established without any kind of complex work. Here, proprietor is responsible for all the
debts and profits of business and it also does not require the approval of government to
set up their business. Partnership: These organisations are the association of individuals of minimum two or
maximum twenty partners in order to earn profit (Deasy and et. al., 2016). These
organisations establish with the help of partnership deed which is the document made by
the mates and it is made in bid to neglect battle between them. It include the legal terms
such as the income sharing ratio, roles and responsibilities and regime of partners.
 Corporation: It is the formation of individualist who make their own business entity.
These organisations are runs and operated by stakeholders which is appointed by Board
of Directors in order to run their businesses. In order to form these associations, different
legal formality is needed which should be fulfilled as it is an entity which transfer their
own trademark.
Public Organisations: These firms are operated by the government or the public physical
structure in bid to provide services to people. These enterprises are closely-held and functioned
by state, localised and central government and it is the collection of both the public services and
endeavour (Saleem, 2017). These organisations are operates on commercialized grounds and
provide different services as it is owned by the state administration. Financial assistance of these
firms are raised by the authorities. For example, Department for work and organisations (DWP)
which is the British government department and the largest governmental body in terms of
employees and budget and formed in 2001.
Purpose: There purpose is to change the economy, development of people, spread
awareness among people and also provide good and valuable services and optimal use of
accessible resources.
Legal Structures:

 Central government: This government indulge different enterprise activities which are
manageable by them in order to control over the business. Moreover, central government
has the power in order to make various laws. Companies who are endeavour and closely-
held by government should take approval from them in bid to run and also affect in the
decision making procedure. State government: This type of government share their governmental powers with
national government as there are many services which are disciplined and managed by
state government because some commodities and services are only supply by state
authorities(Oriesek and Schwarz, 2016).
 Local government: Their role is to gather finances in the form of gathering cost which is
also termed as council tax. This government plays a significant and unique role in order
to identify the needs of individuals. Moreover, they support the organisations in order to
stay in the boundaries of Local Government Act 1972.
Voluntary Organisations: These enterprises are the unit of single person who came in bid to do
some social and well-being services. For this, membership is not essential and also have paid and
unpaid employees (Hillary, 2017). Moreover, group join these companies in order to do well-
being services as they are not for profit entity so they does not have such kind of conventional
legal construction. They are useful in those areas of society who have restricted amount of
resources in order to perform their functions in excellent ways. For instance, The British Heart
foundation is the charity organisation and collect funds for research to beat heartbreak from heart
and circulatory diseases and also identifies their risk factors and founded in 1961.
Purpose: Their purpose is to connect people, grow and enhance volunteering and many
more. As they work for social welfare or their purpose is to provide services for the poor and
needy people.
Legal Structures: Trust: It is the kind of foundation which is owned and runs by the grouping of people
who are termed as trustees. It is maintained and managed by the trust title which is quite
flexible because there is no relevant framework (Okeyo, Gathungu and Peter, 2016).
Here, trustees of these organisations are not elected as they are appointive by board. To
fit up the trust, the group associates should make an agreement which is in written form
as it is famous as trust deed and shows that an structure is legally charitable.

 Unincorporated Associations: This kind of charity is establish by the constitution which
is not even mentioned. For this, company need to add some characteristics such as
restriction on the distribution of funds to their members. These are not integrated so they
cannot make any written agreement. For this, number of individual came into this
concept and without knowing that what the association exactly do.
P2.
Basis Ford Department for work
and Pensions (DWO)
The British Heart
Foundation
Vision The vision of Ford is
to indicate the values
and set the standards
for their competitors
and also encourage the
emotions of general
public.
Their vision is to
create a fair and
affordable welfare
system which help in
improving the chances
of life of children.
Their vision is to make
better world for people
and also encourage
them to work with
them. Make world in
which people do not
die prematurely.
Mission The mission of Ford is
to encourage the
quality which is
accessible to people
and also make lives of
people better by
making mobility
accessible and
affordable.
There mission is to
deliver outstanding
services to their
customers and also
transform the way by
which they deliver
their services in order
to reduce cost and
increases the
efficiency.
Their mission is to
fulfil primary needs of
the poor and needy
people and also win
the fight against
cardiovascular disease.
Size and scope Here, organisation
follow flat structure
and also inspire their
employees in decision
The number of
employees in DWP is
approximately 84, 718
and it include flexible
There are around
3,000 working in the
British Heart
Foundation which is

making. Company has
approximately
1,99,000 employees
(Number of Ford
employees from FY
1992 to FY, 2018)..
and fixed contract staff
(DWP's headcount and
payroll data for
January, 2018)
the voluntary
organisation in UK. It
has wide scope
because it works of the
civil society.
Stakeholders Its stakeholders are
their owners who work
at the top management
in business and invest
their money in
business as if business
losses then the
stakeholders also lose
their money.
Their stakeholders are
the government or
public bodies which
include customers,
general public, etc.
Their involvement
represents that how the
company continuously
improve their
performance.
These kind of
organisations are
directly linked with
organisations such as
funders, commission
etc. Their stakeholders
are the general public
and other voluntary
organisations.
M1.
By analysing the above discussion it is determined that there are three kinds of business
concerns for-profit, public and voluntary and all are essential in business enterprise environment
but the legal structures of all the organisations are different (Virglerová, Dobeš and Vojtovič,
2016). As the intention of private organisation is to gain profit, public is to supply various
services to general public for their convenience and voluntary is to supply social well-being work
to poor and needy people. Moreover, their size, scope and stakeholders are discussed which
different as the structure of an organisation.
TASK 2
P3.
Organisational structure Matrix structure: This composition is supported on the facility instead of the hierarchy
as it describes that group have different portions or work and they should to report to

different kindly of group as they are assigned under different projects under different
managers (Kozubíková, Homolka and Kristalas, 2017). Department for work and
pensions follow global organisational structure as it a public or government body and its
employees perform different functions at the same time. Flat structure: It has limited levels of managerial activities and also encourages decision
making among employees. This structure is in the shape of pyramid shape as it describe
three levels such as top, mediate and berth. Ford follows global organisational
composition as it transfer its merchandise and services and also does not have
investments outside the country.
 Divisional structure: It allows much freedom and liberty in the administration. It is seen
in those enterprises where tasks are operated at the same time (Kolk, 2016). The British
Heart Organisations follows this structure as it is a very complex and many programmes
are owned at the same time. Moreover, it is followed because it gives powers to each
individual.
Ford is an American automotive company and operate its business at a very large scale
and to manage this it is classified into various functions under various units or departments
which are mentioned as under: HR and Finance department: HR department put emphasis on the manlike capital which
the quality for an administration as finance department is useful in order to provide funds
and overview the budget (Davies, 2016). Both the levels of Ford are interlinked with each
other and because of which skilled nominees are hired and recruited in finance section.
By this their overall aim is to collect best campaigner who can make more fiscal schemes.
 Marketing and Sales department: Marketing department conduct marketing
investigation in bid to owed content about the various kinds of data such as taste,
requirements, demand and many more. Moreover, sales department make available
commodity and services to the customers and also make various strategies in order to
increase their sales. Because of this the objectives of Ford can be easily achievable and
also helps in increasing the profits and revenues which is useful in order to increase the
reputation of company.

M2.
By analysing the above organisational structures, coordination and cooperation among
them are important as it help in achieving the targets and objectives of an organisation and also
advantageous from the perspective of employees as it help in rising the overall presentation of
workers. Moreover the system are discussed which depicts that which organisation operate its
business at which level. If the departments of the organisation does not have coordination among
them then it can influences the productiveness of organisation.
D1.
From the preceding part, it is identified that it is essential to have competition among all
the departments of an organisation in order to achieve sustainability and also help in rising the
profitability of the company (May, 2019). Moreover, the composition are adoptive by
considering the vie point of employees as it help in order to retain the foremost talent in the
administration. If the constitution or culture is not according to workers then they does not
activity in an appropriate manner and it can become threat for the company.
TASK 3
P4.
PESTLE environment is a framework which is utilised in bid to analyse those factors
which influences the external environment and also identifies the most essential opportunities
and threats which are based on the external factors (Calabrese and et. al., 2018). The following
factors are discussed as under: Political: By considering the political scenario of Ford it become both the opportunities
and threat for the company. As the political undependability in the EU especially the
Brexit put negative impinging on the execution of Ford as the hard Brexit stands to slow
down the accession to free trade contracts with the other EU countries. As a result it is
marked as the reduction of demand in the market (Ford PESTLE Analysis, 2019). On the
other hand, free commerce contracts and authorities bonus in the market provide huge
chance for maturation which put positive impact on company. As in the market of South
America and Asia where the demand of automobiles are increases by supporting the Ford
who bring innovation in technology and economic growth.

 Economical: Currently, company witnesses the global slack in the amount of cars sales
all over the world. As Ford accounts for the biggest market share and also accomplish
maturation in the developing markets such as India who witnessed the downturn in the
number of vehicles as it put positive impinging on the public presentation of market
(Ford PESTLE Analysis, 2019). Moreover, the dollar getting stronger and the open trade
agreements among the rising schemes promises the immense sales and carries the risk of
increased competitions and approaching market modifications. Social: In modern world, consumers have mixture of choice when it comes to automotive
sector. By using the near saturated market, Ford can face difficulties in bid to pull in
buyers which can put negative influence on the execution of organisation. Moreover, in
the electric and hybrid vehicle it can become possibility for organisation as the supply of
hybrid cars have been rise and Ford already introduces its variants in this category. Technological: By considering this factor application plays an essential role in the choice
of customer as the tech-savvy population has demand more and more cars which are
equipped with the modern technical disposition such as autoloading windows and many
more (Ford PESTLE Analysis, 2019). Another creation which is done by Ford is the
driverless cars which set positive effect on the sales of company and also hopes to
become the market leader. Legal: This factor consider environmental protective cover regulation, increases safety
regulations and property laws which can become chance for the organisation. As it
increases the property of the business in order to address the effect of environmental
security regulation (Ford PESTLE Analysis, 2019). For this, company can increase its
enterprise in order to adjust itself with these regulations as it make sure the better
product designs and safe operative situations which can put positive effect on the
functioning of organisation.
 Environmental: It include various factors such as climate change, low carbon trend,
declining oil reserves and etc. which can become opportunities for the company in order
to modulate in the business situations as it create opportunities for the company to grow
to their products which help in the conservation of environment. While talking about
Ford, the global demand in cars shifting towards environment friendly cars especially for
the electric and hybrid cars as they have no emissions and put friendly for the

environment as it put positive contact on the institution as Ford is headway in the hybrid
and electric models.
M3.
From the above discussion, it is analysed that examining of external environment is
important as it help in reducing the risk factor and it can become threat for the company. It
describe many factors such as political which describes the political stability of the country as
depicts that it put both positive and negative impact on the expansion of company (Fogliasso,
2016). Moreover, the technological part of the company is its strength and become strength for
company while launching its products in the market because Ford is on top in terms of
technology and also continuously adopted updated technology in order to provide better products
to their customers.
TASK 4
P5.
Swot analysis of Ford
Strengths Weaknesses
 Ford offers its products and services to
all segments of society. It caters the
needs or wants of all kinds of
demographic groups with their
diversified product offerings (Evans
and et. al., 2017).
 Ford serves to all segments, therefore it
is a well known brand of automotive
industry. The company is recognised in
global market because of its success
and effective marketing and
advertising.
 The company has poor reputation in
marketplace as compared to its
competitors.
 Another weakness of Ford is its
dependency on the U.S. Market. The
company is highly dependent on the
U.S. And European market, it limits its
operation, revenues and profits to these
markets only (Erasmus, Strydom and
Rudansky-Kloppers, 2016).
Opportunities Threat
 Ford has huge customer base and now  High competition in automotive

it is grabbing opportunity and making
plans to penetrate in Indian and
Chinese marketplace.
 Also, digital marketing is another
possibility which Ford can explore. The
company has best marketing techniques
use of digital technology will enhance
it.
industry is a threat for every
organisation and so as for Ford.
 Raw materials prices are increasing
specifically of steel and steel coil.
These are directly affecting the
operations of Ford, impacting its
production costs.
Porter's Five Forces
This is a framework consisting five external components which are known as forces,
having impacts on the company's current performance (Ji-fan Ren and et. al., 2017). Porter's Five
Forces analysis enable organisation to understand and gain knowledge about the external factors
which can affect company and its operations. These five elements and their effects on Ford are
explained below: Competitive Rivalry: Ford faces tough competition from its rivals and force of existing
competition is really high (Fabuš, 2017). Company has to compete against top players
like Toyota as they are aggressively innovating and introducing their goods in market. Bargaining power of supplier: Suppliers of Ford has moderate influence of prices of raw
material and on the operations of the organisation. The number of suppliers are moderate,
average number of suppliers are present in marketplace. This provides suppliers
significant but moderate bargaining power over Ford. Bargaining power of customers: Customers are everything for Ford and they have
significant influence on the company. Buyers associated with the company have
moderate switching costs, customers can easily transfer from Ford to other firms. Also,
purchase size or order size is moderate too, consumer buys product in small number. Threat of substitutes: As competition is increasing and existing companies are coming
up with new creative ideas company faces great threat of substitutes (Prajogo, 2016). The
availability of substitutes of Ford products are moderate and switching cost of buyers is
also moderate. This is because of the weak performance of substitutes which works as
advantage for Ford.