Ford’s Strategy Model Amidst Increasing Competition in Attractive Industries

Foundations and Information Systems
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Foundations and Information Systems
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Introduction
Efficient strategic management is necessary for the contemporary survival of business organizations. Managers in competitive business environments are obliged to stay insightful if they are to steer their organizations to sustainability. One of the organizations that have operated on a defined strategic path since its founding is Ford Motors. Found at the brink of a booming automotive industry in Europe, Ford forged a strategic path that keeps delivering to date. This analysis explores Ford through its mission and vision statements, porter’s five forces model on the industry, information systems of the organization, and the company’s strategy model. A detailed understanding of Ford’s strategy model should steer managers into understanding avenues to sustain their organizations strategically amidst increasing competition in attractive industries.
Description of the Company
The automotive industry is one of the biggest and most influential industries globally presently. By the end of 2020, the industry commanded a market size of $82.6 billion (Zafar Zain, Ali, & Tunç Cemil, 2021). The competition of this industry is global with organizations attempting to capture developing markets and new markets such as electric or driverless cars. The survival in this industry for Ford has been a matter of forging a superior strategic model. Ford operates with the vision of becoming the world’s leading consumer company for automotive products and services. For an organization operating in a highly competitive industry, that vision statement is a challenge to achieve. Ford, however, has been performing well considering its market share in the industry. According to Pentacoff (2021), Ford commanded a global market share of 13.87% thereby making it the third leading automotive organization globally after General Motors with 17.3% and Toyota Motor Corporation at 14.41%. With extra efforts, Ford can become a leader both in the Michigan automotive cluster before taking the global leadership. Ford accompanies the pursuance of its vision statement with a mission, which is to better people’s lives by making mobility affordable and accessible. This mission statement is monumental to Ford, which operated on accessibility and affordability right from its onset bearing the nature of competition at the time. The strategic path that Ford has adopted makes it among the most visionary organizations in the industry.
Porter’s Five Forces Model
Michael Porter developed forces that influence industries whose impacts are evident in the automotive industry. Primary among forces is the degree of rivalry. The automotive industry is a highly competitive industry with multiple organizations scrambling for market share. Ford operates within the Michigan cluster in which it faces off with other organizations including General Motors and Chrysler with almost equal market share indices (Zafar Zain, Ali, & Tunç Cemil, 2021). The industry is matured and the threats of being acquired by competitors are high. The automotive industry is faced with a weak threat of substitutes. Some of the substitutes to organizations such as Ford include trains, planes, bicycles, and motorbikes that do not offer the same convenience as motor vehicles. The bargaining power of buyers in the automotive industry is strong. While there are many buyers, they are also faced with a variety of products, which eases the switching costs. In this industry, buyers are price sensitive and quality is a matter of consideration for buyers.
The other forces to consider in the automotive industry are the bargaining power of suppliers and the threat of new entrants. The bargaining power of suppliers is weak. That is because there is a large number of suppliers in the industry (Pentacoff, 2021). Materials are also widely accessible and organizations such as Ford have the resources to integrate vertically thereby eliminating some ...