Ford Company Supply Chain Strategy

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Table of contents:
Executive Summary page
Part 1 Executive Summary 3

Issue Identification
Part 2 Fundamental Issue 4
Part 3 Sub-Issue

Environmental and root cause analysis
Part 4 Quantitative and qualitative analysis 5

Alternatives and Options
Part 5 Alternative 1 6 Part 6 Alternative 2

Recommendations and Implementation
Part 7 Recommendations 7 Part 8 Implementation Plan

Monitoring and Control
Part 9
8
Conclusion
Part 10 8 Executive Summary

After analyzing Ford’s existing supply chain I immediately became aware of its highly complex nature. This high level of complexity combined with other internal and external factors that have pushed Ford to search for solutions in order to overcome the costly supply chain challenges that they are facing and may continue to face in the future. Ford’s major difficulty in their present system is the inefficient control of their large data base and complex network of suppliers, the existence of independent distributors and their inability to communicate and serve their customers directly. There is an urgent need to modify their supply chain in order to make it more cost effective and more profitable. My decision is that there is a need of the partial implementation and execution of the virtual integration direct business model that has been used by Dell. Through this model, Ford will use the emerging information technologies and internet as well as new ideas from high tech industries in order to interact and transact with their suppliers and end users. Furthermore, Ford can boost its sales by providing better customer service and by having faster communication between suppliers, manufacturers, and customers in the value chain. This proposed system will have to run concurrently with the existing supply chain so that Ford will cover both market segments at the same time. Since Dell and Ford are two different types of industries, one is in computer manufacturing and the other is in auto industry, it does not seem right for Ford to implement exactly the same "virtual integration model" as Dell. In fact, if Ford implements the full direct business model alone and abolished its existing supply chain then Ford will certainly run into a high risk of losing their business to competitors due to the fact that customers want to test and feel the car before they buy it for a large amount of money. On the other hand, when customers buy computers on line they don’t have to worry about touching and testing the computer, all they require is a better price than the retail shops and the product’s specs are according to their needs. Ford should set up a special department in order to handle this new business process. Investment in new high tech equipments is required as well as training should be provided...
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