HI5014: Ford Motors' International Business Analysis Report

This report provides a comprehensive analysis of Ford Motors' international business operations, focusing on the strategies it employs to navigate the global market. The report delves into Ford's foreign market entry strategies, examining how the company expands its presence through foreign direct investment and the establishment of plants in various countries, including China and South America. It also addresses the competitive dynamics Ford faces, identifying key competitors like General Motors, Toyota, and Honda, and the strategies Ford uses to gain a competitive advantage, such as decentralized policy implementation, centralized strategic leadership, and low-cost leadership. Furthermore, the report explores Ford's organizational structure, highlighting its hierarchical structure and key features like regional geographic divisions, corporate hierarchy, and global functional groups. The importance of knowledge management within Ford is also discussed, particularly in the context of product verification and development. Finally, the report examines Ford's innovations, including the development of new vehicle designs and models aimed at increasing market share and enhancing customer satisfaction.

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International business across borders
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Title: Analysis of a Multi-National Entity

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Executive summary
This report has provided a complete analysis of the ford motors and the strategies which are
adopted by it. The manner in which the company is entering into the market is considered and
with that all of the strategies which are been used by the company are identified. There is the
foreign direct investment which is made by the company for the expansion purpose. The
competition is dealt by the company by using the latest developments and also adopting low-cost
leadership. There is the gain which is attained in the competition also. The hierarch
organizational structure is used in the company and all of the benefits which are thereby using
the same have been identified. The main features of the structures are identified which are very
important. There is the sharing of the experiences in the company and same is identified as the
knowledge management by which the best results will be attained. All of the mistakes which
were made in past are identified and then further process is designed accordingly. There are
several innovations which are made by the company in which the vehicles with the new designs
and models are presented. They help in gaining the market share which is important to attain
growth.

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Table of Contents
Executive summary.........................................................................................................................2
Introduction......................................................................................................................................4
Foreign entry strategy......................................................................................................................4
Competitive dynamics.....................................................................................................................5
Organizational structure...................................................................................................................6
Knowledge management.................................................................................................................8
Innovation........................................................................................................................................9
Conclusion.....................................................................................................................................10
References......................................................................................................................................11

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Introduction
In the global environment, there are various multinational companies which are operating and
carrying the operations in various countries. They are providing the services and products across
the borders. In this report all of the major aspects which need to be considered for them will be
discussed in effective manner. Foreign entry is made by them and in that there is the need to
follow the particular strategy which will be identified and discussed. The competition is faced in
the global market and it is required that it shall be dealt in effective manner. All the dynamics in
this respect will be taken into account in the report. The organizational structure of the company
will be identified to know the manner in which the activities are performed in the company. The
knowledge management is the main requirement and all of elements of the same will be taken
into consideration. To meet with the requirements and deal with the competition there is the need
for innovation. All of the innovation which has been made by the company will be properly
taken into account.
Foreign entry strategy
In the increasing globalization, there is the need for the company to enter the foreign markets so
that they can provide their products in new places and this way the expansion of the business will
be made possible. The entry in the foreign market is not an easy task and in that process there is
the need to adopt various policies and strategies. Ford Motors Company is also looking towards
the expansion of the business in the foreign countries and for that it is using the global market
development strategy (Hilmersson and Jansson, 2012). There is the direct investment which is
made in this case and in that the setting up of the plant in various countries is made. Ford has
done the same and has incorporated the plants in various countries and in that china and South
America are also included. In this process of the direct investment there is a high amount of the
cost which is required to be incurred and also the significant amount of the risk which is
involved. There is the need to keep the check on the cost which is incurred and for that proper
controlling system is adopted by the ford which ensures that it benefits from the various
investments which are made (Erdil and Özdemir, 2016). Europe is covered by ford and now it is
looking to expand in the Asian market by which its production will be increased and there will
be more income which will be earned.

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In making the entry into the foreign markets there are certain issues which are also faced and
they include the balancing which is required to be made between the regulations and laws which
are applicable in that country. All the countries have various laws which are applicable and it
becomes difficult to have the knowledge of all and then make them follow in an effective
manner. The climatic conditions are also different which also acts as a barrier for the company.
The change will be affecting the production and the capabilities as the change in climate affect
various aspects which will be finally affecting the operations of the company (Arslan, Tarba and
Larimo, 2015). Due to all of these barriers it is required that there shall be roper evaluation
which shall be made about the place in which expansion is required to be made. All of these will
be evaluated and then the decision to make the entry in the market shall be made so that no
issues are faced in the after circumstances. The return which will be made will be increasing with
the help of this.
Competitive dynamics
The vehicle industry involved the common factors and due to that there are various competitors
who are included and same is with ford motors. There are many competitors with whom the
company is required to deal and they include the general motors, Toyota, Honda, Hyundai, and
Nissan. They all are also manufacturing the various vehicles in all streams and it becomes
difficult to deal with the competition (Mellat-Parast, 2013). To deal with the competition in the
market there is the need to adopt the proper strategy by which this will be made possible.
Company has also made several strategies and now working with them to gain additional benefit
with the competition. There is an increase in the global market share by which the number of
users in the company will be increased and this will be raising the demand. The profits of the
company will be increased with the help of this and there will be additional funds which can be
invested to gain more benefits. The company produces such smart cars which are not available in
the market and with the invention of them there will be gaining of the more customers. They will
be provided by making various changes in relation to fuel efficiency and other facilities. The
company will be adding the safety features by which the customers will prefer the vehicles of the
ford motors in place of others.
The main strategies which are used by the company include decentralized policy implementation

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and centralized strategic leadership. In the case of centralized leadership, there is the top
management who will be responsible to take all the decisions. They will be considering all the
opportunities which are available in the market and then will be deciding by adopting the one
which will be provided with the best results (Ford and Håkansson, 2013). They will be focusing
on the expectations of the consumers and will be providing such products by which customer
satisfaction will be attained as this gives company the long term growth. Another approach of the
decentralized policy implementation will also be beneficial as with the help of that all of the
layers which are involved in the management will be eliminated and by that the communication
can be made in direct manner. All the misunderstandings which arise in the management will be
eliminated and there will be best operations which will be undertaken. All of the processes will
be undertaken by the use of the guidelines and that will attain the best results. All of them who
are included in the process will be empowered and they will also be involved in the processes.
By this the efficient will be enhanced as all will be highly motivated.
The low-cost leadership approach has also been adopted by the company in which all of the
excessive costs which are incurred in the production process are eliminated (Cattani, Porac and
Thomas, 2017). By this the overall cost is reduced and there will be less cost which will be
charged from the customers. The consumers will prefer the same and this way the market will be
captured and also the revenues will be increased.
Organizational structure
All of the companies follow some organization structure so that all the activities are performed in
a better manner. In case of ford motors there is the hierarchical structure is taken into
consideration. By this it can be said that the process will be flowing from the top management
which is the strategic management to operational management and employees. All the business
needs are identified and then the structure has been designed in such manner that it can be
carried in the different market conditions. The elements which are included in them are such by
which the market risks and competition both will be taken into consideration. There is a good
structure by which the success is obtained in the business.

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(Source: Wordpress, 2019)
The main feature of the company’s structure is that control will be established as per the
requirement of the regional market conditions. The main features of the organization structure
are regional geographic divisions, corporate hierarchy and global functional groups (Mainemelis
and Epitropaki, 2013). There are various groups which control the operations in the global
market in an effective manner. They look into all the departments which include finance, global
purchasing, accounting, and communication.
There are various advantages which will be received with the use of the organizational structure
and they include that there will be functional support which will be made available. Also, the
global control and directions will be ensured which will be making the operations to be
completed in the most effective manner and there will be control which will be established on all
the tasks which are performed. All of the integrated strategies and policies which are involved
will be implemented in an easy manner and that will be of benefit to the company. The
disadvantage which will be required to be faced due to this includes the avoidance of the unique
conditions which arise in relation to the national markets. They are not considered so will not be
attended in an effective manner (McEvily, Soda and Tortoriello, 2014). With the application of

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the system there will be proper functioning which will be ensured and the company will be able
to attain all the targets which have been set. By the application of the structure there is the
improvement which has been made in the sales of the company and the same has been noted.
This will be raising the profits and by that the impact is also made in the stock price. This is
because if the profits will be made then the company will be distributing them and that will
motivate the investors. They will be investing and market demand will be raised. There will be
rise in the share price which will also be of the benefit to the company.
Knowledge management
In the company, there are various activities which are performed and in them there is some
experience which is involved. Knowledge management is the system by which the experience in
various operations will be created and this way knowledge will be enhanced. This is used in the
companies so that full potential of the employees can be realized and they can attain the best of
the results. The knowledge will be shared among the employees and by that they will be able to
learn the various experiences and bets of the results will be attained by them in an effective
manner.
Ford motors are also applying the knowledge management in the company and are applied in the
product verification process (Darroch and Mazerolle, 2013). This has been used for the product
development department as they were the ones who were using the huge amount of money which
was increasing the cost of the company. Under this technique all of the previous experiences
were used by the company and there was the observation which was made. The experiences were
used to be applied in such manner that the cost of the verification process will be reduced. The
products will be manufactured with the best quality as in this all the prior information will be
used which includes reviews. Transfer of the best practices is made in which all the approaches
which have gained the best results will be provided to the future departments. There is a list of
the experts which is made and in that the experiences of them are also shared. All the issues
which are faced by them and the manner in which they have been resolved are mentioned in the
same. All the departments will be using that knowledge for their benefit and will attain the best
results (Fast company, 2019). The decisions will be made by taking them into consideration and
eliminating the aspects which shall be improved and for this the data will be analyzed

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appropriately. All of the content which provides the experience is saved and that is used by the
other departments to avoid the mistakes which have been made in the past and there will be
proper quality improvements which will be made possible in the company.
This way ford motors is using the knowledge management is attaining the growth by using the
best approaches to maintain the quality and obtain the trust of customers.
Innovation
In the changing world, there are various developments which are taking place in terms of
innovations and technology. It is required by the company to be in pace with the changes which
are taking place so that it can maintain the position in the market. With the use of the outdated
technology and old methods it will not be able to compete with the companies that are using the
advanced technologies. In the automotive industry there is the need to adopt the changes and
offer the consumers with the new development which will be enhancing their experience and
they will be attracted with the company (Ford, 2019). This will be raising the requirements and
the demand for the company will be increasing. The new technologies will be used and by that
the new models will be provided which will be opted above others.
There are various innovations which are made by ford motors and in that moving assembly line
was the one. This has been invented by the company and has made the model T to be more
affordable now. By the help of the assembly line, there is a reduction in the production time
which is involved and that saves the labor cost which was higher. The working hours of the
employees are decreased and the increase in salaries is also made. This motivates the employees
further and they are willing to work with more efficiency by using the full potential. The
employees will be retained and there will be less employee turnover which will be made
applicable.
There are several iconic cars which are introduced by the company and in them, there are
additional functions which are provided. The design of the cars is improved and it is made in
such manner that more people are attracted. The new innovation which is made includes the
new-generation electric vehicle. This has high stakes and is gaining popularity in the market.
There is the involvement of the digital technology in the market and so the human-machine

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interaction is innovated which is as per the needs of the new market (The CEO magazine, 2019).
The innovations which are made in the company are unique and are applied globally. All the
people accept the changes which are made as they are sure that company is offering them
something new and innovative. There is the trust which is built among the customer by which
they can be retained and will be using the services of the company.
Conclusion
The report has been made in relation to the expansion of the multi-national company in foreign
markets. There is the need or the development and entry in the foreign market is made. In that,
there are several strategies which are used and they have been identified for the ford motors. The
manner in which competition is dealt with has also been covered and in that all of the aspects in
this respect have been included. The company is following a particular organizational structure
and that has been identified. The manner in which it is used for the benefit of the company has
been explained. All of the benefits and demerits of the same have been identified and taken into
account. There is knowledge management which is involved in the company. The elements in
this respect have been identified. The company will be benefiting from the same and it has been
explained in the proper manner. In this process there is the use of past experiences which will be
made. The appropriate results will be obtained which will be in the interest of the company and
chances of errors are also reduced. There is the need for the innovations and that is explained.
With that all of the major innovations which have been made in the company have also been
taken into account.

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References
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freedom distance: Evidence from Nordic FDIs in transitional periphery of CIS and
SEE. International Business Review, 24(6), pp.997-1008.
Cattani, G., Porac, J.F. and Thomas, H. (2017) Categories and competition. Strategic
Management Journal, 38(1), pp.64-92.
Darroch, S. and Mazerolle, L. (2013) Intelligence-led policing: A comparative analysis of
organizational factors influencing innovation uptake. Police quarterly, 16(1), pp.3-37.
Erdil, T.S. and Özdemir, O. (2016 ) The determinants of relationship between marketing mix
strategy and drivers of export performance in foreign markets: An application on Turkish
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Fast comapny. (2019) Ford. [Online] Available at: https://www.fastcompany.com/company/ford
[Accessed 13 September 2019]
Ford, D. and Håkansson, H. (2013) Competition in business networks. Industrial Marketing
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Ford. (2019) Innovation. [Online] Available at: https://corporate.ford.com/innovation.html
[Accessed 13 September 2019]
Hilmersson, M. and Jansson, H. (2012). International network extension processes to
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Business Review, 21(4), pp.682-693.
Mainemelis, C. and Epitropaki, O. (2013) Extreme leadership as creative leadership: Reflections
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McEvily, B., Soda, G. and Tortoriello, M. (2014) More formally: Rediscovering the missing link
between formal organization and informal social structure. Academy of Management

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Annals, 8(1), pp.299-345.
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