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Running head: PART 2: SUMMARY AND OUTLINE
Part 2: Summary and Outline
Orange Team
Christopher Ellerbe, Mark Sickinger, Hailey Childers, Jenny
Morgan, Luis RodriguezPart 2: Summary and OutlineGrand
Canyon UniversityCourse: MGT 660-0500 Strategic
ManagementWednesday, March 27, 2019Instructor: Dr. Joseph
Kennedy
CLC: Strategic Management Case Analysis Part 2: Summary
and Outline
Summary and Outline of Findings
Based on the 12 steps to creating an Executive Summary,
Ford has many strengths, weaknesses, opportunities, and threats
both internally and externally as well as several objectives and
strategies in the works. Below is a summary of each step:
· Step 1: Ford does not have a vision statement. The mission
statement is to be One Ford, One team, One plan, and One goal.
The objective is to become the world’s most trusted mobility
company through sales, safety, research and innovation, and
sustainability. The strategies in place involve reducing costs of
products and new innovations such as higher engine outputs and
increased safety features (Ford, 2018).
· Step 2: The new vision statement is Advancing the automotive
industry through innovation and efficiency. The new mission
statement is Ford Motor Company: Driving a greener future.
· Step 3: External opportunities include creating fuel efficient
vehicles, expanding globally, consumer spending increase,
increased demand of utility vehicles, and growth of the
automotive industry. External threats include higher priced
materials, changing gas prices, increased competition, and
alternative modes of transportation (Rezwana, 2015).
· Step 4: Based on the Competitive Profile Matrix, Ford scores
lowest, with GM second, and Toyota rating highest.
· Step 5: Based on the External Factor Evaluation, the total
score is 2.22 which is an average score meaning the strategies
of Ford are neither effective nor ineffective at defending threats
and seizing opportunities.
· Step 6: Internal strengths include being known worldwide,
loyal customers, constant innovation, employing a skilled
workforce, and automating processes. Internal weaknesses
include fighting the union, vehicle recalls, high attrition costs,
lack of global marketing, and falling behind in the latest
technology (Meyer, 2017; McKenzie, 2015).
· Step 7: Based on the Internal Factor Evaluation, the total score
is 2.75 which is an average score meaning Ford is neither
affective nor ineffective at defending internal threats and
capitalizing on its strengths.
· Step 8: The SWOT analysis reveals that electric vehicles are
the future of Ford. The Space analysis shows that Ford is
competitive, Toyota is aggressive, and GM is defensive. The
Boston Consulting Group analysis shows that the Fully Electric
Mustang is a cash cow, the Fusion Hybrid and Focus Electric
are dogs, and the F150 Ecoboost and Fusion Energi are question
marks. The Internal-External analysis shows that both the F150
Ecoboost and the Fully Electric Mustang are at the top of the
chart for internal and external factors, the Fusion Hybrid is
strong internally but average externally, and the Fusion Energi
and Focus Electric are average or slightly below both internally
and externally. The Grand Strategy analysis reveals the Fully
Electric Mustang has rapid market growth but no competitive
position, the F150 Ecoboost has a strong competitive positive
and slight market growth, the Fusion Hybrid has a strong
competitive positive but slow market growth, and both the
Focus Electric and Fusion Energi have a weak competitive
position and slow market growth. The Quantitative Strategic
Planning Matrix reveals strategy one is more appealing than
strategy two.
· Step 9: Strategy one involves focusing on internal weaknesses
as well as external opportunities, costing the company $5
billion over the next 3 years.
· Step 10: Strategy one can be implemented by better employee
training, global marketing, and investing in research and
development to attack both weaknesses internally as well as
opportunities externally. This should occur over a three-year
period with income substantially increasing in year 3.
· Step 11: The first-year objectives should include training all
employees and coming up with three new vehicle designs. The
second-year objectives include training all employees and the
innovation department having blueprints and prototypes of the
vehicles created. The third-year objectives include training all
employees, vehicles going to market, and new designs being
researched.
· Step 12: Strategy review needs to be done at the end of every
year to determine if the steps taken are working or if the SWOT
analysis reveals new strategy needs. The bottom line also needs
to reviewed to determine if the vehicles created are profitable
and selling globally as per the strategy.
References
David, F.R. & David, F.R. (2017). Strategic management: A
competitive advantage approach
(16th ed.). Boston, MA: Prentice Hall.
Ford (2018). Ford Motor Company 2017 Annual Report
Ford (2019). Strategy and governance. Retrieved on March 12,
2019 from
https://corporate.ford.com/microsites/sustainability-report-
2017-18/strategy- governance/index.html
Ford.com. (2019). Ford Motor Company,. Retrieved from
ford.com: https://www.ford.com/
Jurevicius, O. (2013). Competitive profile matrix (CPM).
Strategic Management Insight.
Retrieved from
https://www.strategicmanagementinsight.com/tools/competitive-
profile
matrix-cpm.html
MarketWatch. (2019, March 26). Ford Motor Co. Retrieved
from MarketWatch:
https://www.marketwatch.com/investing/stock/f
Market Watch. (2019, March 26). General Motors Co. Retrieved
from MarketWatch:
https://www.marketwatch.com/investing/stock/gm
Market Watch. (2019, March 26). Toyota Motor Corp. ADR.
Retrieved from MarketWatch:
https://www.marketwatch.com/investing/stock/tm
Martinez, M. (2019, January 10). Why Ford is restructuring in
Europe - again. Retrieved from
https://www.autonews.com/blogs/why-ford-restructuring-
europe-again
McKenzie, S. (2015, April 29). Rise of the robots: The
evolution of Ford's assembly line. Retrieved from
https://money.cnn.com/gallery/technology/2015/04/29/ford-
factory-assembly-line-robots/index.html
Meyer, P. (2017, February 5). Ford Motor Company: Generic &
Intensive Growth Strategies. Retrieved from
http://panmore.com/ford-motor-company-generic-intensive-
growth-strategies
Rezwana, Z. (2015). Strategy management of Ford motor
companies. In. Retrieved from
https://www.slideshere.net/zrezwana/strategy-management-
of-ford-motor-company
Ritson, M. (2010, August 13). What Marketers Can Learn From
Ford. Retrieved from
https://www.brandingstrategyinsider.com/2010/08/what-
marketers-can-learn-from-ford.html#.XJmTvsJ7lPY
Rogers, C. (2015, September 30). UAW Gets Ready to Strike
Ford's Truck Plant in Kansas City. Retrieved from
https://www.wsj.com/articles/uaw-gets-ready-to-strike-fords-
truck-plant-in-kansas-city-1443571908
SEC (2018). Form 10k: Ford Motor Company. Retrieved on
March 12, 2019 from
https://corporate.ford.com/microsites/sustainability-report-
2017-18/doc/sr17-2017-form-10-k.pdf
Appendix
Step 1 Identify the firm’s existing vision, mission, objectives,
and strategies.
Vision/Mission Statement
Ford’s vision is not explicitly defined. Because of this, the
company relies on its mission statement to define the direction
of the company. The mission statement outlines four important
components: One Ford, One team, One plan, and One goal
(Ford, 2018). As one Ford, the company commits to align
employee efforts towards a common definition of success (Ford,
2018). As one team, the company shows that all stakeholders
will work together to achieve automotive leadership as
measured through customer satisfaction, satisfaction of
employees, and business partners like dealers, suppliers,
communities, and investors (Ford, 2018). One plan means that
the company is committed to aggressively restructure to make
profits under the current market conditions (Ford, 2018). Under
one goal, Ford is committed to creating an exciting and
profitable company delivering growth to all (David & David,
2017). This mission statement covers the interests of all
stakeholders by committing to make sure they are all satisfied.
It also shows that the company understands that the automotive
company is changing and therefore commits to constantly
restructuring in order to make profits under new conditions. The
mission also shows unity within the company.
Objectives
The company currently has a range of objectives based on sales,
safety, research and innovation, and sustainability. The main
objective is to be the world’s most trusted mobility company
(Ford, 2018). In sales, the company has an objective to increase
its global sales and has set a target of 9.4 million vehicles by
2020 (Ford, 2018). In research and innovation, the company
wants to be a leader in integrating new technologies and is
working towards increased mobility through better vehicle
safety, electrification, in-car connectivity, and self-driven
autonomous vehicles (Ford, 2018). The company has invested in
research and innovation through the Palo Alto Research and
Innovation Center. On sustainability, the company is committed
to reducing greenhouse gas emissions and making better fuel
consuming vehicles (SEC, 2018). It is also investing on
recycling and reusing materials from obsolete cars.
Strategies
The company has different strategies in place. For example, it is
focused on busing recycling centers near its factories so as to
facilitate the recycling and reuse of materials. The company
also has a research and innovation center in Silicon Valley that
spearheads its innovations and thus makes sure it does not miss
new trends and technologies (Ford, 2019). One of the new
innovations is creating higher engine outputs with smaller
displacements which will greatly improve fuel economy and
emissions (David & David, 2017). Another innovation is
improving safety by adding Blind Spot Monitoring, lane alerts,
and parking assist. This center also comes with better ways of
achieving sustainability.
To increase global sales, the company makes use of cost
leadership strategy by providing high quality vehicles at
mainstream prices. “In 2014, Ford launched more vehicles than
ever before in a single calendar year, including a new Mustang
and F-150” (David & David, 2017). Ford is also currently
engaged in its largest manufacturing expansion by increasing
capacity in six U.S. plants and opening two plants in Asia and
one each in South America and Europe. To increase trust
among all stakeholders, the company constantly engages them
to prioritize their issues.
Step 2 Develop vision and mission statements for the
organization.
Vision
Advancing the automotive industry through innovation and
efficiency.
Mission
Ford Motor Company: Driving a greener future
Step 3 Identify the organization’s external opportunities and
threats.
Opportunities
With the emphasis on going green during the last decade, Ford
will have a great opportunity for sales of fuel-efficient vehicles
in the future. Ford has already seen large revenue from fuel
efficient vehicle sales. The demand of utility vehicles is a great
opportunity for Ford Motors as well because the Ford F150 is
the leading utility vehicle in the industry. Global expansion and
joint ventures will allow Ford to increase sales across the world
(David & David, 2017).
Threats
The increased price of materials would lead to an increased
sales price of Ford vehicles. Decrease in gas prices would lead
to a decreased necessity of consumers to buy fuel efficient cars
leading to a surplus in this type of vehicle. The same idea goes
for increased gas prices and the utility and SUV vehicles that
require more fuel to run. Alternative transportation such as
trains and buses, especially in large cities, decrease the need for
consumers to purchase vehicles (Rezwana, 2015).
Step 4 Construct a Competitive Profile Matrix (CPM).
Ford
Toyota
GM
Critical Success Factors
Weight
Rating
Score
Rating
Score
Rating
Score
Global Expansion
0.14
2
0.28
3
0.42
3
0.42
Financial Position
0.10
2
0.20
4
0.40
3
0.30
Growth
0.16
1
0.16
3
0.48
4
0.64
US Market Share
0.20
3
0.60
4
0.80
2
0.40
Customer Loyalty
0.15
4
0.60
3
0.45
3
0.45
Fuel Efficient Vehicles
0.18
3
0.54
3
0.54
2
0.36
Employee Expertise
0.07
3
0.21
4
0.28
3
0.21
Totals
1.00
2.59
3.37
2.78
Step 5 Construct an External Factor Evaluation (EFE) Matrix.
Opportunities
Weight
Rating
Weighted Score
1
Fuel Efficient Vehicles
0.15
3
0.45
2
Global Expansion
0.14
2
0.28
3
Increased Consumer Spending
0.09
1
0.09
4
Demand of Utility Vehicles
0.12
3
0.36
5
Industry Growth
0.08
1
0.08
Threats
Weight
Rating
Weighted Score
1
Increase in Price of Materials
0.08
2
0.16
2
Increase in Gas Prices
0.08
3
0.24
3
Decrease in Gas Prices
0.08
1
0.08
4
Increased Competition
0.12
3
0.36
5
Alternative Transportation
0.06
2
0.12
Total EFE Score
1.00
2.22
Step 6 Identify the organization’s internal strengths and
weaknesses.
Strengths
Ford Motor Company’s strength is that it is a worldwide brand
with high customer loyalty; moreover, Ford has a strong
position in brand name vehicles within its fleet (Ritson, 2010).
Their innovative ability to find creative ways to reduce the
weight of the vehicles but still provide the strength in their
trucks shows their ability to conduct research and development
(Meyer, 2017) making their F-series truck the bestselling in the
world. Ford has an automotive technician program that holds
automotive training throughout the country in various
community colleges and public technical schools. These
programs help Ford pick and choose the best performers to hire
as their technicians while also introducing technicians who are
familiar with the Ford brand out in the communities throughout
the country. While Ford is training technicians, it is also
working on improving and automating some of its procedures to
save costs and improve accuracy and automate its undesired
jobs (McKenzie, 2015). An example of automation is the laser
camera systems that review the outer-body of the vehicle to
ensure no dents or imperfection in which it may be difficult to
determine with the human eye, to the installation of windshields
with suction cups and robotic machinery.
Weaknesses
With all of Ford's strengths, they do have weaknesses. Ford's
relationship with the union is imperative to its success.
Negotiating with the bargaining unit and not giving up
management rights while preventing a strike is essential. A
strike can cause a massive loss of production and profit. Recalls
can also cause massive losses to Ford. An example is Ford and
Firestone tire recall. In the year 2000, an investigation and
inquiry began on the blow out of the Firestone tires installed for
the Ford Explorer. Ford recalled and replaced the tires, but not
after various lawsuits and congressional inquiries causing a
bitter court battle between Ford and Firestone.
Ford does strive to train their employees, but at one time they
had issue retaining their employees. Employees where leaving,
searching for better wages, working conditions, and better
healthcare options during the economic boom. High attrition
causes high cost for training which can cause mistakes and
delays in production. Ford needs to work on its marketing
outside the United States. They currently rely too much on
their sales in the United States, while in Europe, their products
are considered inferior (Martinez, 2019) compared to BMW and
Mercedes. Tesla emerging in the automotive market as a leader
in battery operated vehicles is a massive oversite from Ford.
These are profits lost because Tesla was able to sneak its way
into the automotive industry creating a good fuel-efficient
electric vehicle of high quality.
Step 7 Construct an Internal Factor Evaluation (IFE) Matrix.
Strengths
Weight
Rating
Weighted Score
Worldwide Brand
0.15
4
0.60
Customer Loyalty
0.06
3
0.18
Innovation
0.15
4
0.60
Skilled Workforce
0.06
3
0.18
Automation
0.06
3
0.18
Weaknesses
Weight
Rating
Weighted Score
Union Issues
0.15
2
0.30
Vehicle Recalls
0.15
2
0.30
High Attrition
0.03
1
0.03
Product Marketing
0.03
2
0.06
Technology
0.16
2
0.32
Total IFE Score
1.00
2.75
Step 8 Prepare a Strengths-Weaknesses-Opportunities-Threats
(SWOT) Matrix,
Strategic Position and Action Evaluation (SPACE) Matrix,
Boston Consulting
Group (BCG) Matrix, Internal-External (IE) Matrix, Grand
Strategy Matrix, and
Quantitative Strategic Planning Matrix (QSPM) as appropriate.
Give advantages
and disadvantages of alternative strategies.
SWOT
SO Strategies
1
Create/market new EV brand line (S1, O1)
2
Add new locations to build EV line (S4, S5, O3, O4 )
ST Strategies
1
Increase automation to keep prices down (S5, T1, T2, T4, T5)
2
Invest in R&D to keep loyal customers, innovate to attract new
customers and exploit gas prices increasing in our favor (S2,
S3, T3)
WO Strategies
1
Add resources to market new line (W4, O1, O2)
2
Add EV division with own production center to accommodate
for the growth and give R&D toward new technology (W2, W5,
O1, O3)
WT Strategies
1
Hire R&D personnel to push technology and stay competitive
(W5, T5)
2
Invest in lean & robust manufacturing processes to decrease
failures and excess materials being used (W2, T1)
Space
Internal Analysis:
External Analysis:
Financial Position (FP)
Stability Position (SP)
Return on Investment (ROI)
5
Rate of Inflation
-4
Leverage
1
Technological Changes
-7
Liquidity
2
Price Elasticity of Demand
-2
Working Capital
5
Competitive Pressure
-5
Cash Flow
5
Barriers to Entry into Market
-2
Financial Position (FP) Average
3.6
Stability Position (SP) Average
-4.0
Internal Analysis:
External Analysis:
Competitive Position (CP)
Industry Position (IP)
Market Share
-3
Growth Potential
6
Product Quality
-2
Financial Stability
4
Customer Loyalty
-2
Ease of Entry into Market
6
Technological know-how
-4
Resource Utilization
2
Control over Suppliers and Distributors
-5
Profit Potential
6
Competitive Position (CP) Average
-3.2
Industry Position (IP) Average
4.8
BCG
Relative Market Share Position
High 1.0
Low 0.0
Industry Sales Growth Rate
High 0.20
Low -0.20
IE
THE IFE TOTAL WEIGHTED SCORES
Strong
Weak
4.0
1.0
High
4.0
THE EFE WEIGHTED SCORES
Low
1.0
Grand Strategy
QSPM
4
2
Strengths
Weight
AS
TAS
AS
TAS
1
Worldwide Brand
0.15
3
0.45
2
0.30
2
Customer Loyalty
0.06
3
0.18
4
0.24
3
Innovation
0.15
4
0.60
3
0.45
4
Skilled Workforce
0.06
2
0.12
3
0.18
5
Automation
0.06
3
0.18
4
0.24
4
2
Weaknesses
Weight
AS
TAS
AS
TAS
1
Union Issues
0.15
2
0.30
3
0.45
2
Vehicle Recalls
0.15
3
0.45
1
0.15
3
High Attrition
0.03
3
0.09
1
0.03
4
Product Marketing
0.03
3
0.09
2
0.06
5
Technology
0.16
4
0.64
3
0.48
4
2
Opportunities
Weight
AS
TAS
AS
TAS
1
Fuel Efficient Vehicles
0.13
4
0.52
3
0.39
2
Global Expansion
0.11
3
0.33
2
0.22
3
Industry Growth
0.06
4
0.24
2
0.12
4
Demand of Utility Vehicles
0.11
2
0.22
1
0.11
5
Joint Ventures
0.08
3
0.24
4
0.32
4
2
Threats
Weight
AS
TAS
AS
TAS
1
Increase in Price of Materials
0.07
3
0.21
1
0.07
2
Increase in Gas Prices
0.11
4
0.44
3
0.33
3
Decrease in Gas Prices
0.09
1
0.09
3
0.27
4
Increased Competition
0.14
3
0.42
2
0.28
5
Alternative Transportation
0.10
3
0.30
2
0.20
STAS
6.11
4.12
Step 9 Recommend specific strategies and long-term objectives.
Show how much your
recommendations will cost. Clearly itemize these costs for each
projected year.
Compare your recommendations to actual strategies planned by
the company.
Using forecasting tools such as the MIS technique, External
Factor Evaluation (EFE) Matrix and the Competitive Profile
Matrix (CPM), Ford Motor Company can gather, analyze and
determine the major factors contributing to the declining sales.
According to David & David (2017), in today’s market, as
gasoline prices have risen above $4.00 per gallon in the United
States since the September 2010 low of $2.70 per gallon, fuel
economy has consistently been the number one reason for
purchases of hybrid automobiles in the United States.
Therefore, where most attention has been put into efficiency of
producibility and establishing a lean culture, the attention must
now turn to innovation to increase sales.
Based on Strategy One listed above, which is the more desirable
strategy, internal weaknesses and external opportunities need to
be a major focus. To do this, employees need better training
both on how to create the vehicle as well as how to deal with
the union. Ford also needs to do marketing globally which will
increase global sales but in order for the marketing to be
successful, these markets must be thoroughly researched, and
new innovations and technology must become apparent. The
cost of this strategy will be upwards of $5,000,000,000 over the
next three years. Training employees will be the cost of hourly
employees with maybe a few external speakers (around $1
billion), research and development will be the expensive section
(around $3 billion), and marketing will be around $1 billion as
you have to learn what works globally and what does not.
As Talay, Calantone & Voorhees (2014) states, Ford Motor
Company is proposing to spend billions on autonomy,
electrification, and new mobility services. Ford also announced
plans to invest $1 billion over five years in artificial
intelligence, pour $4.5 billion into 13 new electric vehicles by
2021, and acquire or partner with services such as on-demand
shuttles and bicycle-sharing programs. Realizing investments in
research and development for such innovations is risky, it also
comes with huge reward potential, especially when the market
and economy is increasing the pace from a steady walk to a full
sprint regarding new technology. Hughes-Cromwick (2011)
recognize that, based on the findings of extensive research and
data mining, automotive manufacturers must develop a
structured product development program that allows for
continual and steady new product introductions; otherwise, even
momentary setbacks can have a damaging impact on a firm’s
ability to survive in the automotive marketplace.
Step 10 Specify how your recommendations can be implemented
and what results you
can expect. Prepare forecasted ratios and projected financial
statements. Present a
timetable or agenda for action.
Our strategy can be implemented by better training employees,
marketing globally, and investing in research and development.
In order to train employees, a program should be created for
each position as to how to do that job. When an employee joins
Ford or changes positions, this training program should be
taught to the employee. Each employee should also have
trainings/meetings once a year (or more if necessary) to keep
updated with the system and any new changes that are
happening both internally and externally. This will keep all
employees current on their positions as well as involved in the
company. To market globally, research must be done to see
what the global markets are wanting to see in the automotive
industry and then the development team must create these
changes or come up with new innovations that will gain market
share. Once these products are created, marketing globally can
attract new customers to the Ford brand rather than just relying
on North American sales. If the research and innovation teams
do their jobs correctly, and marketing can get the brand out,
sales globally should increase astronomically. The first year
financials will decrease as employees are being trained and
research is being done, but by year two, financials will have
leveled out as trainings are not as costly creating better
efficiency in vehicle designs causing lower recalls but now
design and innovation teams are ramped up, and finally by year
three, financials will skyrocket as the new products are being
put to market.
Projected Income Statement
12/31/2019
12/31/2020
12/31/2021
Revenues
$159,915,600,000
$166,312,224,000
$182,943,446,400
Cost of Goods Sold
127,932,480,000
124,734,168,000
128,060,412,480
Gross Profit
31,983,120,000
41,578,056,000
54,883,033,920
Operating Expenses
20,789,028,000
21,620,589,120
23,782,648,032
EBIT
11,194,092,000
19,957,466,880
31,100,385,888
Interest Expense
1,410,500,000
1,411,000,000
1,411,500,000
EBT
9,783,592,000
18,546,466,880
29,688,885,888
Tax
1,369,702,880
2,781,970,032
5,937,777,178
Non-Recurring Events
1,000,000,000
3,000,000,000
1,000,000,000
Net Income
7,413,889,120
12,764,496,848
22,751,108,710
Projected Balance Sheet
12/31/2019
12/31/2020
12/31/2021
Assets
Cash and Equivalents
$46,318,889,120
$52,033,385,968
$67,784,494,678
Accounts Receivable
61,050,000,000
57,050,000,000
49,050,000,000
Inventory
11,185,000,000
11,235,000,000
9,235,000,000
Other Current Assets
3,650,000,000
3,650,000,000
3,650,000,000
Total Current Assets
122,203,889,120
123,968,385,968
129,719,494,678
Property Plant & Equipment
64,560,000,000
65,560,000,000
65,560,000,000
Goodwill
75,000,000
75,000,000
75,000,000
Intangibles
213,000,000
213,000,000
5,213,000,000
Other Long-Term Assets
77,852,000,000
77,852,000,000
77,852,000,000
Total Assets
264,903,889,120
267,668,385,968
278,419,494,678
Liabilities
Accounts Payable
21,280,000,000
19,280,000,000
17,280,000,000
Other Current Liabilities
76,320,000,000
76,320,000,000
76,320,000,000
Total Current Liabilities
97,600,000,000
95,600,000,000
93,600,000,000
Long-Term Debt
101,670,000,000
99,670,000,000
97,670,000,000
Other Long-Term Liabilities
25,520,000,000
23,520,000,000
21,520,000,000
Total Liabilities
224,790,000,000
218,790,000,000
212,790,000,000
Equity
Common Stock
41,000,000
41,000,000
41,000,000
Retained Earnings
26,323,889,120
35,088,385,968
51,839,494,678
Treasury Stock
(1,250,000,000)
(1,250,000,000)
(1,250,000,000)
Paid in Capital & Other
14,999,000,000
14,999,000,000
14,999,000,000
Total Equity
40,113,889,120
48,878,385,968
65,629,494,678
Total Liabilities and Equity
264,903,889,120
267,668,385,968
278,419,494,678
Projected Ratios
12/31/2019
12/31/2020
12/31/2021
Current Ratio
1.25
1.30
1.39
Quick Ratio
1.14
1.18
1.29
Debt-to-Total-Assets Ratio
0.85
0.82
0.76
Debt-to-Equity Ratio
5.60
4.48
3.24
Times-Interest-Earned Ratio
8
14
22
Inventory Turnover
14.3
14.8
19.8
Fixed Assets Turnover
2.48
2.54
2.79
Total Assets Turnover
0.60
0.62
0.66
Accounts Receivable Turnover
3
3
4
Average Collection Period
139.34
125.21
97.86
Gross Profit Margin %
20%
25%
0.3
Operating Profit Margin %
7%
12%
17%
ROA %
3%
5%
8%
ROE %
18%
26%
35%
Step 11 Recommend specific annual objectives and policies.
Following Strategy One, the first-year annual objectives
will include making sure every employee in the organization has
received their appropriate training and that the research
department has successfully came up with three new vehicle
models that are now in the innovation stage. In year two, the
annual objectives of training will continue from year one but
also adding that the innovation department has blue prints of the
vehicles and prototypes are created. By year three, the same
training objectives should be occurring but also that the new
vehicles should now be going to market for consumer purchase.
Additionally, by this point, the research team should be looking
at coming up with new vehicle models or improvements for the
current models.
Step 12 Recommend procedures for strategy review and
evaluation.
To review to make sure the strategy is working as planned,
an evaluation needs to be conducted at the end of each year to
see if the company still has the same strengths and weaknesses
internally, as well as understanding how they are comparing to
the competition and if external opportunities or threats have
changed. To do this, a SWOT analysis and a competitive
profile matrix should be performed. Ford also needs to
determine how their profits are performing for the new vehicle
lines and if the new electric vehicles are the solution to their
bottom line. To figure this out, the financial statements and
ratios should be evaluated at year end when filed. If the SWOT
analysis reveals different items than the current strategy focuses
on, a revaluation of the strategy is needed. If the CPM reveals
that the competition is growing stronger in relation to Ford, the
strategy should again be evaluated as electric vehicles are
apparently not the solution and more needs to be done for the
bottom line.
FordFusion HybridFusion EnergiFocus ElectricF150
EcoboostFully Electric MustangQuadrant IIQuadrant IQuadrant
IIIQuadrant IVRapid MarketGrowthSlow MarketGrowthStrong
Competitive PositionWeak Competitive Position
Rubic_Print_FormatCourse CodeClass CodeMGT-660MGT-660-
O500CLC - Strategic Management Case Analysis Part 3:
Executive Summary With
Exhibits80.0CriteriaPercentageUnsatisfactory (0.00%)Less than
Satisfactory (74.00%)Satisfactory (79.00%)Good
(87.00%)Excellent (100.00%)CommentsPoints
EarnedContent100.0%Executive Summary 55.0%An executive
summary that describes the best way to address the selected
aspect of the strategic management process is not included. An
executive summary that describes the best way to address the
selected aspect of the strategic management process is included
but lacks any discernible overall purpose or organizing claim.
Partially relevant data is used to support findings.An executive
summary that describes the best way to address the selected
aspect of the strategic management process is included. The
summary is apparent and appropriate to purpose. Mostly
relevant data is used to support findings.An executive summary
that describes the best way to address the selected aspect of the
strategic management process is included. The summary is
descriptive and reflective of the arguments and appropriate to
the purpose. Relevant data is used to support findings.An
executive summary that describes the best way to address the
selected aspect of the strategic management process is included.
The summary purpose is clear and serves as the foundation for a
plan to achieve the purpose. Relevant data is used to support
findings and illustrates a deep understanding of the
subject.Argument Logic and Construction30.0%Statement of
purpose is not justified by the conclusion. The conclusion does
not support the claim made. Argument is incoherent and uses
noncredible sources.Sufficient justification of claims is lacking.
Argument lacks consistent unity. There are obvious flaws in the
logic. Some sources have questionable credibility.Argument is
orderly, but may have a few inconsistencies. The argument
presents minimal justification of claims. Argument logically,
but not thoroughly, supports the purpose. Sources used are
credible. Introduction and conclusion bracket the thesis.
Argument shows logical progressions. Techniques of
argumentation are evident. There is a smooth progression of
claims from introduction to conclusion. Most sources are
authoritative.Clear and convincing argument that presents a
persuasive claim in a distinctive and compelling manner. All
sources are authoritative.Language Use and Audience
Awareness (includes sentence construction, word choice,
etc.)10.0%Inappropriate word choice and lack of variety in
language use are evident. Writer appears to be unaware of
audience. Use of ?primer prose? indicates writer either does not
apply figures of speech or uses them inappropriately.Some
distracting inconsistencies in language choice (register) and/or
word choice are present. The writer exhibits some lack of
control in using figures of speech appropriately. Language is
appropriate to the targeted audience for the most part.The writer
is clearly aware of audience, uses a variety of appropriate
vocabulary for the targeted audience, and uses figures of speech
to communicate clearly.The writer uses a variety of sentence
constructions, figures of speech, and word choice in distinctive
and creative ways that are appropriate to purpose, discipline,
and scope.Mechanics of Writing (includes spelling,
punctuation, grammar, language use) 5.0%Slide errors are
pervasive enough that they impede communication of
meaning.Frequent and repetitive mechanical errors distract the
reader.Some mechanical errors or typos are present, but are not
overly distracting to the reader.Slides are largely free of
mechanical errors, although a few may be present.Writer is
clearly in control of standard, written academic English.Total
Weightage100%
Strategic Management Case Analysis
Strategic Management Case Analysis
This is a CLC assignment.
This assignment provides an opportunity to practice applying
strategic management concepts. Refer to “Part 6: Strategic
Management Case Analysis” in your textbook. Each team is
responsible for selecting a case from the following list:
1. Krispy Kreme
2. Marriott
3. Wynn Resorts International
4. Jet Blue
5. GoPro
6. Artic Cat
7. Ford Motor
8. Apple
9. Taser International
Note: The instructor will assign each student to a team.
Exchange team member information in order to work together
throughout the course on this assignment.
Reminder: Please continue working on these assignments during
topics that do not have deliverables.
Part 1: Action Plan and Calendar of Events (Topic 2)
Select a case from “Part 6: Strategic Management Case
Analysis.” First, identify the key issue(s) in the case and then
identify a particular aspect of the strategic management process
that your analysis will focus on which can include the
following:
· Identify and evaluate the organization's existing vision,
mission, objectives, and strategies.
· To propose and defend specific recommendations for the
company.
· To develop an industry analysis by describing the competitors,
products, selling techniques, and market conditions in a given
industry (from textbook).
Next, create an action plan that details how you will conduct the
case analysis including assigning roles and tasks to specific
project members. The action plan should include a calendar of
events with specific team members assigned to tasks. An
Executive Summary is a required deliverable in your calendar of
events. Please note the Executive Summary is not due until
Topic 7; however, your action plan will help inform the
Executive Summary.
While APA format is not required for the body of this
assignment, solid academic writing is expected, and
documentation of sources should be presented using APA
formatting guidelines, which can be found in the APA Style
Guide, located in the Student Success Center.
You are not required to submit this assignment to LopesWrite.
Part 2: Summary and Outline (Topic 4)
Part 2 is designed to draft your executive summary with
exhibits. Refer to Steps 1-12 outlined in your textbook. Develop
the best way to addresses the selected aspect of the strategic
management process that the team chose to focus on in Part I.
Identify and apply the tools needed to complete your analysis.
Find outside resources and information to help authenticate
your analysist. These tools will be featured as exhibits in your
Executive Summary that is due in Topic 7.
Provide a 300-500 word summary and outline of your findings
including three to five sources.
This assignment uses a rubric. Please review the rubric prior to
beginning the assignment to become familiar with the
expectations for successful completion.
You are required to submit this assignment to LopesWrite.
Refer to the LopesWrite Technical Support articles for
assistance.
Part 3: Executive Summary with Exhibits (Topic 7)
Write a 500-750-word Executive Summary with Exhibits.
This assignment uses a rubric. Please review the rubric prior to
beginning the assignment to become familiar with the
expectations for successful completion.
You are required to submit this assignment to LopesWrite.
Refer to the LopesWrite Technical Support articles for
assistance.
© 2016. Grand Canyon University. All Rights Reserved.
2

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Running head PART 2 SUMMARY AND OUTLINEPart 2 Summary and Out.docx

  • 1. Running head: PART 2: SUMMARY AND OUTLINE Part 2: Summary and Outline Orange Team Christopher Ellerbe, Mark Sickinger, Hailey Childers, Jenny Morgan, Luis RodriguezPart 2: Summary and OutlineGrand Canyon UniversityCourse: MGT 660-0500 Strategic ManagementWednesday, March 27, 2019Instructor: Dr. Joseph Kennedy CLC: Strategic Management Case Analysis Part 2: Summary and Outline Summary and Outline of Findings Based on the 12 steps to creating an Executive Summary, Ford has many strengths, weaknesses, opportunities, and threats both internally and externally as well as several objectives and strategies in the works. Below is a summary of each step: · Step 1: Ford does not have a vision statement. The mission statement is to be One Ford, One team, One plan, and One goal. The objective is to become the world’s most trusted mobility company through sales, safety, research and innovation, and
  • 2. sustainability. The strategies in place involve reducing costs of products and new innovations such as higher engine outputs and increased safety features (Ford, 2018). · Step 2: The new vision statement is Advancing the automotive industry through innovation and efficiency. The new mission statement is Ford Motor Company: Driving a greener future. · Step 3: External opportunities include creating fuel efficient vehicles, expanding globally, consumer spending increase, increased demand of utility vehicles, and growth of the automotive industry. External threats include higher priced materials, changing gas prices, increased competition, and alternative modes of transportation (Rezwana, 2015). · Step 4: Based on the Competitive Profile Matrix, Ford scores lowest, with GM second, and Toyota rating highest. · Step 5: Based on the External Factor Evaluation, the total score is 2.22 which is an average score meaning the strategies of Ford are neither effective nor ineffective at defending threats and seizing opportunities. · Step 6: Internal strengths include being known worldwide, loyal customers, constant innovation, employing a skilled workforce, and automating processes. Internal weaknesses include fighting the union, vehicle recalls, high attrition costs, lack of global marketing, and falling behind in the latest technology (Meyer, 2017; McKenzie, 2015). · Step 7: Based on the Internal Factor Evaluation, the total score is 2.75 which is an average score meaning Ford is neither affective nor ineffective at defending internal threats and capitalizing on its strengths. · Step 8: The SWOT analysis reveals that electric vehicles are the future of Ford. The Space analysis shows that Ford is competitive, Toyota is aggressive, and GM is defensive. The Boston Consulting Group analysis shows that the Fully Electric Mustang is a cash cow, the Fusion Hybrid and Focus Electric are dogs, and the F150 Ecoboost and Fusion Energi are question marks. The Internal-External analysis shows that both the F150 Ecoboost and the Fully Electric Mustang are at the top of the
  • 3. chart for internal and external factors, the Fusion Hybrid is strong internally but average externally, and the Fusion Energi and Focus Electric are average or slightly below both internally and externally. The Grand Strategy analysis reveals the Fully Electric Mustang has rapid market growth but no competitive position, the F150 Ecoboost has a strong competitive positive and slight market growth, the Fusion Hybrid has a strong competitive positive but slow market growth, and both the Focus Electric and Fusion Energi have a weak competitive position and slow market growth. The Quantitative Strategic Planning Matrix reveals strategy one is more appealing than strategy two. · Step 9: Strategy one involves focusing on internal weaknesses as well as external opportunities, costing the company $5 billion over the next 3 years. · Step 10: Strategy one can be implemented by better employee training, global marketing, and investing in research and development to attack both weaknesses internally as well as opportunities externally. This should occur over a three-year period with income substantially increasing in year 3. · Step 11: The first-year objectives should include training all employees and coming up with three new vehicle designs. The second-year objectives include training all employees and the innovation department having blueprints and prototypes of the vehicles created. The third-year objectives include training all employees, vehicles going to market, and new designs being researched. · Step 12: Strategy review needs to be done at the end of every year to determine if the steps taken are working or if the SWOT analysis reveals new strategy needs. The bottom line also needs to reviewed to determine if the vehicles created are profitable and selling globally as per the strategy.
  • 4. References David, F.R. & David, F.R. (2017). Strategic management: A competitive advantage approach (16th ed.). Boston, MA: Prentice Hall. Ford (2018). Ford Motor Company 2017 Annual Report Ford (2019). Strategy and governance. Retrieved on March 12, 2019 from https://corporate.ford.com/microsites/sustainability-report- 2017-18/strategy- governance/index.html Ford.com. (2019). Ford Motor Company,. Retrieved from ford.com: https://www.ford.com/ Jurevicius, O. (2013). Competitive profile matrix (CPM). Strategic Management Insight. Retrieved from https://www.strategicmanagementinsight.com/tools/competitive- profile matrix-cpm.html MarketWatch. (2019, March 26). Ford Motor Co. Retrieved from MarketWatch: https://www.marketwatch.com/investing/stock/f Market Watch. (2019, March 26). General Motors Co. Retrieved from MarketWatch: https://www.marketwatch.com/investing/stock/gm Market Watch. (2019, March 26). Toyota Motor Corp. ADR. Retrieved from MarketWatch: https://www.marketwatch.com/investing/stock/tm Martinez, M. (2019, January 10). Why Ford is restructuring in Europe - again. Retrieved from https://www.autonews.com/blogs/why-ford-restructuring- europe-again
  • 5. McKenzie, S. (2015, April 29). Rise of the robots: The evolution of Ford's assembly line. Retrieved from https://money.cnn.com/gallery/technology/2015/04/29/ford- factory-assembly-line-robots/index.html Meyer, P. (2017, February 5). Ford Motor Company: Generic & Intensive Growth Strategies. Retrieved from http://panmore.com/ford-motor-company-generic-intensive- growth-strategies Rezwana, Z. (2015). Strategy management of Ford motor companies. In. Retrieved from https://www.slideshere.net/zrezwana/strategy-management- of-ford-motor-company Ritson, M. (2010, August 13). What Marketers Can Learn From Ford. Retrieved from https://www.brandingstrategyinsider.com/2010/08/what- marketers-can-learn-from-ford.html#.XJmTvsJ7lPY Rogers, C. (2015, September 30). UAW Gets Ready to Strike Ford's Truck Plant in Kansas City. Retrieved from https://www.wsj.com/articles/uaw-gets-ready-to-strike-fords- truck-plant-in-kansas-city-1443571908 SEC (2018). Form 10k: Ford Motor Company. Retrieved on March 12, 2019 from https://corporate.ford.com/microsites/sustainability-report- 2017-18/doc/sr17-2017-form-10-k.pdf Appendix Step 1 Identify the firm’s existing vision, mission, objectives, and strategies.
  • 6. Vision/Mission Statement Ford’s vision is not explicitly defined. Because of this, the company relies on its mission statement to define the direction of the company. The mission statement outlines four important components: One Ford, One team, One plan, and One goal (Ford, 2018). As one Ford, the company commits to align employee efforts towards a common definition of success (Ford, 2018). As one team, the company shows that all stakeholders will work together to achieve automotive leadership as measured through customer satisfaction, satisfaction of employees, and business partners like dealers, suppliers, communities, and investors (Ford, 2018). One plan means that the company is committed to aggressively restructure to make profits under the current market conditions (Ford, 2018). Under one goal, Ford is committed to creating an exciting and profitable company delivering growth to all (David & David, 2017). This mission statement covers the interests of all stakeholders by committing to make sure they are all satisfied. It also shows that the company understands that the automotive company is changing and therefore commits to constantly restructuring in order to make profits under new conditions. The mission also shows unity within the company. Objectives The company currently has a range of objectives based on sales, safety, research and innovation, and sustainability. The main objective is to be the world’s most trusted mobility company (Ford, 2018). In sales, the company has an objective to increase its global sales and has set a target of 9.4 million vehicles by 2020 (Ford, 2018). In research and innovation, the company wants to be a leader in integrating new technologies and is working towards increased mobility through better vehicle safety, electrification, in-car connectivity, and self-driven autonomous vehicles (Ford, 2018). The company has invested in research and innovation through the Palo Alto Research and Innovation Center. On sustainability, the company is committed to reducing greenhouse gas emissions and making better fuel
  • 7. consuming vehicles (SEC, 2018). It is also investing on recycling and reusing materials from obsolete cars. Strategies The company has different strategies in place. For example, it is focused on busing recycling centers near its factories so as to facilitate the recycling and reuse of materials. The company also has a research and innovation center in Silicon Valley that spearheads its innovations and thus makes sure it does not miss new trends and technologies (Ford, 2019). One of the new innovations is creating higher engine outputs with smaller displacements which will greatly improve fuel economy and emissions (David & David, 2017). Another innovation is improving safety by adding Blind Spot Monitoring, lane alerts, and parking assist. This center also comes with better ways of achieving sustainability. To increase global sales, the company makes use of cost leadership strategy by providing high quality vehicles at mainstream prices. “In 2014, Ford launched more vehicles than ever before in a single calendar year, including a new Mustang and F-150” (David & David, 2017). Ford is also currently engaged in its largest manufacturing expansion by increasing capacity in six U.S. plants and opening two plants in Asia and one each in South America and Europe. To increase trust among all stakeholders, the company constantly engages them to prioritize their issues. Step 2 Develop vision and mission statements for the organization. Vision Advancing the automotive industry through innovation and efficiency. Mission Ford Motor Company: Driving a greener future Step 3 Identify the organization’s external opportunities and threats. Opportunities With the emphasis on going green during the last decade, Ford
  • 8. will have a great opportunity for sales of fuel-efficient vehicles in the future. Ford has already seen large revenue from fuel efficient vehicle sales. The demand of utility vehicles is a great opportunity for Ford Motors as well because the Ford F150 is the leading utility vehicle in the industry. Global expansion and joint ventures will allow Ford to increase sales across the world (David & David, 2017). Threats The increased price of materials would lead to an increased sales price of Ford vehicles. Decrease in gas prices would lead to a decreased necessity of consumers to buy fuel efficient cars leading to a surplus in this type of vehicle. The same idea goes for increased gas prices and the utility and SUV vehicles that require more fuel to run. Alternative transportation such as trains and buses, especially in large cities, decrease the need for consumers to purchase vehicles (Rezwana, 2015). Step 4 Construct a Competitive Profile Matrix (CPM). Ford Toyota GM Critical Success Factors Weight Rating Score Rating Score Rating Score Global Expansion 0.14 2 0.28 3 0.42
  • 9. 3 0.42 Financial Position 0.10 2 0.20 4 0.40 3 0.30 Growth 0.16 1 0.16 3 0.48 4 0.64 US Market Share 0.20 3 0.60 4 0.80 2 0.40 Customer Loyalty 0.15 4 0.60 3 0.45 3 0.45 Fuel Efficient Vehicles 0.18
  • 10. 3 0.54 3 0.54 2 0.36 Employee Expertise 0.07 3 0.21 4 0.28 3 0.21 Totals 1.00 2.59 3.37 2.78 Step 5 Construct an External Factor Evaluation (EFE) Matrix. Opportunities Weight Rating Weighted Score 1 Fuel Efficient Vehicles 0.15 3 0.45 2 Global Expansion
  • 11. 0.14 2 0.28 3 Increased Consumer Spending 0.09 1 0.09 4 Demand of Utility Vehicles 0.12 3 0.36 5 Industry Growth 0.08 1 0.08 Threats Weight Rating Weighted Score 1 Increase in Price of Materials 0.08
  • 12. 2 0.16 2 Increase in Gas Prices 0.08 3 0.24 3 Decrease in Gas Prices 0.08 1 0.08 4 Increased Competition 0.12 3 0.36 5 Alternative Transportation 0.06 2 0.12 Total EFE Score 1.00 2.22 Step 6 Identify the organization’s internal strengths and weaknesses. Strengths Ford Motor Company’s strength is that it is a worldwide brand with high customer loyalty; moreover, Ford has a strong position in brand name vehicles within its fleet (Ritson, 2010). Their innovative ability to find creative ways to reduce the weight of the vehicles but still provide the strength in their
  • 13. trucks shows their ability to conduct research and development (Meyer, 2017) making their F-series truck the bestselling in the world. Ford has an automotive technician program that holds automotive training throughout the country in various community colleges and public technical schools. These programs help Ford pick and choose the best performers to hire as their technicians while also introducing technicians who are familiar with the Ford brand out in the communities throughout the country. While Ford is training technicians, it is also working on improving and automating some of its procedures to save costs and improve accuracy and automate its undesired jobs (McKenzie, 2015). An example of automation is the laser camera systems that review the outer-body of the vehicle to ensure no dents or imperfection in which it may be difficult to determine with the human eye, to the installation of windshields with suction cups and robotic machinery. Weaknesses With all of Ford's strengths, they do have weaknesses. Ford's relationship with the union is imperative to its success. Negotiating with the bargaining unit and not giving up management rights while preventing a strike is essential. A strike can cause a massive loss of production and profit. Recalls can also cause massive losses to Ford. An example is Ford and Firestone tire recall. In the year 2000, an investigation and inquiry began on the blow out of the Firestone tires installed for the Ford Explorer. Ford recalled and replaced the tires, but not after various lawsuits and congressional inquiries causing a bitter court battle between Ford and Firestone. Ford does strive to train their employees, but at one time they had issue retaining their employees. Employees where leaving, searching for better wages, working conditions, and better healthcare options during the economic boom. High attrition causes high cost for training which can cause mistakes and delays in production. Ford needs to work on its marketing outside the United States. They currently rely too much on their sales in the United States, while in Europe, their products
  • 14. are considered inferior (Martinez, 2019) compared to BMW and Mercedes. Tesla emerging in the automotive market as a leader in battery operated vehicles is a massive oversite from Ford. These are profits lost because Tesla was able to sneak its way into the automotive industry creating a good fuel-efficient electric vehicle of high quality. Step 7 Construct an Internal Factor Evaluation (IFE) Matrix. Strengths Weight Rating Weighted Score Worldwide Brand 0.15 4 0.60 Customer Loyalty 0.06 3 0.18 Innovation 0.15 4 0.60 Skilled Workforce 0.06 3 0.18 Automation 0.06 3 0.18
  • 15. Weaknesses Weight Rating Weighted Score Union Issues 0.15 2 0.30 Vehicle Recalls 0.15 2 0.30 High Attrition 0.03 1 0.03 Product Marketing 0.03 2 0.06 Technology 0.16 2 0.32 Total IFE Score 1.00 2.75 Step 8 Prepare a Strengths-Weaknesses-Opportunities-Threats (SWOT) Matrix, Strategic Position and Action Evaluation (SPACE) Matrix, Boston Consulting
  • 16. Group (BCG) Matrix, Internal-External (IE) Matrix, Grand Strategy Matrix, and Quantitative Strategic Planning Matrix (QSPM) as appropriate. Give advantages and disadvantages of alternative strategies. SWOT SO Strategies 1 Create/market new EV brand line (S1, O1) 2 Add new locations to build EV line (S4, S5, O3, O4 ) ST Strategies 1 Increase automation to keep prices down (S5, T1, T2, T4, T5) 2 Invest in R&D to keep loyal customers, innovate to attract new customers and exploit gas prices increasing in our favor (S2,
  • 17. S3, T3) WO Strategies 1 Add resources to market new line (W4, O1, O2) 2 Add EV division with own production center to accommodate for the growth and give R&D toward new technology (W2, W5, O1, O3) WT Strategies 1 Hire R&D personnel to push technology and stay competitive (W5, T5)
  • 18. 2 Invest in lean & robust manufacturing processes to decrease failures and excess materials being used (W2, T1) Space
  • 19.
  • 20.
  • 21.
  • 22.
  • 23.
  • 24. Internal Analysis: External Analysis: Financial Position (FP) Stability Position (SP) Return on Investment (ROI) 5 Rate of Inflation -4 Leverage 1 Technological Changes -7 Liquidity 2 Price Elasticity of Demand -2 Working Capital 5 Competitive Pressure -5 Cash Flow 5 Barriers to Entry into Market -2 Financial Position (FP) Average 3.6
  • 25. Stability Position (SP) Average -4.0 Internal Analysis: External Analysis: Competitive Position (CP) Industry Position (IP) Market Share -3 Growth Potential 6 Product Quality -2
  • 26. Financial Stability 4 Customer Loyalty -2 Ease of Entry into Market 6 Technological know-how -4 Resource Utilization 2 Control over Suppliers and Distributors -5 Profit Potential 6 Competitive Position (CP) Average -3.2 Industry Position (IP) Average 4.8
  • 27. BCG Relative Market Share Position High 1.0 Low 0.0 Industry Sales Growth Rate
  • 29.
  • 30.
  • 32. IE THE IFE TOTAL WEIGHTED SCORES Strong Weak 4.0 1.0
  • 37. 0.30 3 0.45 2 Vehicle Recalls 0.15 3 0.45 1 0.15 3 High Attrition 0.03 3 0.09 1 0.03 4 Product Marketing 0.03 3 0.09 2 0.06 5 Technology 0.16 4 0.64 3 0.48
  • 39. 3 0.33 2 0.22 3 Industry Growth 0.06 4 0.24 2 0.12 4 Demand of Utility Vehicles 0.11 2 0.22 1 0.11 5 Joint Ventures 0.08 3 0.24 4 0.32
  • 40. 4 2 Threats Weight AS TAS AS TAS 1 Increase in Price of Materials 0.07 3 0.21 1 0.07 2 Increase in Gas Prices 0.11 4
  • 41. 0.44 3 0.33 3 Decrease in Gas Prices 0.09 1 0.09 3 0.27 4 Increased Competition 0.14 3 0.42 2 0.28 5 Alternative Transportation 0.10 3 0.30 2 0.20 STAS 6.11 4.12
  • 42. Step 9 Recommend specific strategies and long-term objectives. Show how much your recommendations will cost. Clearly itemize these costs for each projected year. Compare your recommendations to actual strategies planned by the company. Using forecasting tools such as the MIS technique, External Factor Evaluation (EFE) Matrix and the Competitive Profile Matrix (CPM), Ford Motor Company can gather, analyze and determine the major factors contributing to the declining sales. According to David & David (2017), in today’s market, as gasoline prices have risen above $4.00 per gallon in the United States since the September 2010 low of $2.70 per gallon, fuel economy has consistently been the number one reason for purchases of hybrid automobiles in the United States. Therefore, where most attention has been put into efficiency of producibility and establishing a lean culture, the attention must now turn to innovation to increase sales. Based on Strategy One listed above, which is the more desirable strategy, internal weaknesses and external opportunities need to be a major focus. To do this, employees need better training both on how to create the vehicle as well as how to deal with the union. Ford also needs to do marketing globally which will increase global sales but in order for the marketing to be successful, these markets must be thoroughly researched, and new innovations and technology must become apparent. The cost of this strategy will be upwards of $5,000,000,000 over the next three years. Training employees will be the cost of hourly employees with maybe a few external speakers (around $1 billion), research and development will be the expensive section (around $3 billion), and marketing will be around $1 billion as you have to learn what works globally and what does not. As Talay, Calantone & Voorhees (2014) states, Ford Motor Company is proposing to spend billions on autonomy,
  • 43. electrification, and new mobility services. Ford also announced plans to invest $1 billion over five years in artificial intelligence, pour $4.5 billion into 13 new electric vehicles by 2021, and acquire or partner with services such as on-demand shuttles and bicycle-sharing programs. Realizing investments in research and development for such innovations is risky, it also comes with huge reward potential, especially when the market and economy is increasing the pace from a steady walk to a full sprint regarding new technology. Hughes-Cromwick (2011) recognize that, based on the findings of extensive research and data mining, automotive manufacturers must develop a structured product development program that allows for continual and steady new product introductions; otherwise, even momentary setbacks can have a damaging impact on a firm’s ability to survive in the automotive marketplace. Step 10 Specify how your recommendations can be implemented and what results you can expect. Prepare forecasted ratios and projected financial statements. Present a timetable or agenda for action. Our strategy can be implemented by better training employees, marketing globally, and investing in research and development. In order to train employees, a program should be created for each position as to how to do that job. When an employee joins Ford or changes positions, this training program should be taught to the employee. Each employee should also have trainings/meetings once a year (or more if necessary) to keep updated with the system and any new changes that are happening both internally and externally. This will keep all employees current on their positions as well as involved in the company. To market globally, research must be done to see what the global markets are wanting to see in the automotive industry and then the development team must create these changes or come up with new innovations that will gain market share. Once these products are created, marketing globally can attract new customers to the Ford brand rather than just relying
  • 44. on North American sales. If the research and innovation teams do their jobs correctly, and marketing can get the brand out, sales globally should increase astronomically. The first year financials will decrease as employees are being trained and research is being done, but by year two, financials will have leveled out as trainings are not as costly creating better efficiency in vehicle designs causing lower recalls but now design and innovation teams are ramped up, and finally by year three, financials will skyrocket as the new products are being put to market. Projected Income Statement 12/31/2019 12/31/2020 12/31/2021 Revenues $159,915,600,000 $166,312,224,000 $182,943,446,400 Cost of Goods Sold 127,932,480,000 124,734,168,000 128,060,412,480 Gross Profit 31,983,120,000
  • 46. Projected Balance Sheet 12/31/2019 12/31/2020 12/31/2021 Assets Cash and Equivalents $46,318,889,120 $52,033,385,968 $67,784,494,678 Accounts Receivable 61,050,000,000 57,050,000,000 49,050,000,000 Inventory 11,185,000,000 11,235,000,000 9,235,000,000 Other Current Assets 3,650,000,000 3,650,000,000 3,650,000,000 Total Current Assets 122,203,889,120 123,968,385,968 129,719,494,678 Property Plant & Equipment 64,560,000,000 65,560,000,000 65,560,000,000
  • 47. Goodwill 75,000,000 75,000,000 75,000,000 Intangibles 213,000,000 213,000,000 5,213,000,000 Other Long-Term Assets 77,852,000,000 77,852,000,000 77,852,000,000 Total Assets 264,903,889,120 267,668,385,968 278,419,494,678 Liabilities Accounts Payable 21,280,000,000 19,280,000,000 17,280,000,000 Other Current Liabilities 76,320,000,000 76,320,000,000 76,320,000,000 Total Current Liabilities 97,600,000,000 95,600,000,000 93,600,000,000
  • 48. Long-Term Debt 101,670,000,000 99,670,000,000 97,670,000,000 Other Long-Term Liabilities 25,520,000,000 23,520,000,000 21,520,000,000 Total Liabilities 224,790,000,000 218,790,000,000 212,790,000,000 Equity Common Stock 41,000,000 41,000,000 41,000,000 Retained Earnings 26,323,889,120 35,088,385,968 51,839,494,678 Treasury Stock (1,250,000,000) (1,250,000,000) (1,250,000,000) Paid in Capital & Other 14,999,000,000 14,999,000,000 14,999,000,000
  • 49. Total Equity 40,113,889,120 48,878,385,968 65,629,494,678 Total Liabilities and Equity 264,903,889,120 267,668,385,968 278,419,494,678 Projected Ratios 12/31/2019 12/31/2020 12/31/2021 Current Ratio 1.25 1.30 1.39 Quick Ratio 1.14 1.18 1.29
  • 50. Debt-to-Total-Assets Ratio 0.85 0.82 0.76 Debt-to-Equity Ratio 5.60 4.48 3.24 Times-Interest-Earned Ratio 8 14 22 Inventory Turnover 14.3 14.8 19.8 Fixed Assets Turnover 2.48 2.54 2.79 Total Assets Turnover 0.60 0.62 0.66
  • 51. Accounts Receivable Turnover 3 3 4 Average Collection Period 139.34 125.21 97.86 Gross Profit Margin % 20% 25% 0.3 Operating Profit Margin % 7% 12% 17% ROA % 3% 5% 8% ROE % 18% 26% 35%
  • 52. Step 11 Recommend specific annual objectives and policies. Following Strategy One, the first-year annual objectives will include making sure every employee in the organization has received their appropriate training and that the research department has successfully came up with three new vehicle models that are now in the innovation stage. In year two, the annual objectives of training will continue from year one but also adding that the innovation department has blue prints of the vehicles and prototypes are created. By year three, the same training objectives should be occurring but also that the new vehicles should now be going to market for consumer purchase. Additionally, by this point, the research team should be looking at coming up with new vehicle models or improvements for the current models. Step 12 Recommend procedures for strategy review and evaluation. To review to make sure the strategy is working as planned, an evaluation needs to be conducted at the end of each year to see if the company still has the same strengths and weaknesses internally, as well as understanding how they are comparing to the competition and if external opportunities or threats have changed. To do this, a SWOT analysis and a competitive profile matrix should be performed. Ford also needs to determine how their profits are performing for the new vehicle lines and if the new electric vehicles are the solution to their bottom line. To figure this out, the financial statements and ratios should be evaluated at year end when filed. If the SWOT analysis reveals different items than the current strategy focuses on, a revaluation of the strategy is needed. If the CPM reveals that the competition is growing stronger in relation to Ford, the strategy should again be evaluated as electric vehicles are apparently not the solution and more needs to be done for the bottom line.
  • 53. FordFusion HybridFusion EnergiFocus ElectricF150 EcoboostFully Electric MustangQuadrant IIQuadrant IQuadrant IIIQuadrant IVRapid MarketGrowthSlow MarketGrowthStrong Competitive PositionWeak Competitive Position Rubic_Print_FormatCourse CodeClass CodeMGT-660MGT-660- O500CLC - Strategic Management Case Analysis Part 3: Executive Summary With Exhibits80.0CriteriaPercentageUnsatisfactory (0.00%)Less than Satisfactory (74.00%)Satisfactory (79.00%)Good (87.00%)Excellent (100.00%)CommentsPoints EarnedContent100.0%Executive Summary 55.0%An executive summary that describes the best way to address the selected aspect of the strategic management process is not included. An executive summary that describes the best way to address the selected aspect of the strategic management process is included but lacks any discernible overall purpose or organizing claim. Partially relevant data is used to support findings.An executive summary that describes the best way to address the selected aspect of the strategic management process is included. The summary is apparent and appropriate to purpose. Mostly relevant data is used to support findings.An executive summary that describes the best way to address the selected aspect of the strategic management process is included. The summary is descriptive and reflective of the arguments and appropriate to the purpose. Relevant data is used to support findings.An executive summary that describes the best way to address the selected aspect of the strategic management process is included. The summary purpose is clear and serves as the foundation for a plan to achieve the purpose. Relevant data is used to support findings and illustrates a deep understanding of the subject.Argument Logic and Construction30.0%Statement of purpose is not justified by the conclusion. The conclusion does not support the claim made. Argument is incoherent and uses noncredible sources.Sufficient justification of claims is lacking. Argument lacks consistent unity. There are obvious flaws in the
  • 54. logic. Some sources have questionable credibility.Argument is orderly, but may have a few inconsistencies. The argument presents minimal justification of claims. Argument logically, but not thoroughly, supports the purpose. Sources used are credible. Introduction and conclusion bracket the thesis. Argument shows logical progressions. Techniques of argumentation are evident. There is a smooth progression of claims from introduction to conclusion. Most sources are authoritative.Clear and convincing argument that presents a persuasive claim in a distinctive and compelling manner. All sources are authoritative.Language Use and Audience Awareness (includes sentence construction, word choice, etc.)10.0%Inappropriate word choice and lack of variety in language use are evident. Writer appears to be unaware of audience. Use of ?primer prose? indicates writer either does not apply figures of speech or uses them inappropriately.Some distracting inconsistencies in language choice (register) and/or word choice are present. The writer exhibits some lack of control in using figures of speech appropriately. Language is appropriate to the targeted audience for the most part.The writer is clearly aware of audience, uses a variety of appropriate vocabulary for the targeted audience, and uses figures of speech to communicate clearly.The writer uses a variety of sentence constructions, figures of speech, and word choice in distinctive and creative ways that are appropriate to purpose, discipline, and scope.Mechanics of Writing (includes spelling, punctuation, grammar, language use) 5.0%Slide errors are pervasive enough that they impede communication of meaning.Frequent and repetitive mechanical errors distract the reader.Some mechanical errors or typos are present, but are not overly distracting to the reader.Slides are largely free of mechanical errors, although a few may be present.Writer is clearly in control of standard, written academic English.Total Weightage100%
  • 55. Strategic Management Case Analysis Strategic Management Case Analysis This is a CLC assignment. This assignment provides an opportunity to practice applying strategic management concepts. Refer to “Part 6: Strategic Management Case Analysis” in your textbook. Each team is responsible for selecting a case from the following list: 1. Krispy Kreme 2. Marriott 3. Wynn Resorts International 4. Jet Blue 5. GoPro 6. Artic Cat 7. Ford Motor 8. Apple 9. Taser International Note: The instructor will assign each student to a team. Exchange team member information in order to work together throughout the course on this assignment. Reminder: Please continue working on these assignments during topics that do not have deliverables. Part 1: Action Plan and Calendar of Events (Topic 2) Select a case from “Part 6: Strategic Management Case Analysis.” First, identify the key issue(s) in the case and then identify a particular aspect of the strategic management process that your analysis will focus on which can include the following: · Identify and evaluate the organization's existing vision, mission, objectives, and strategies. · To propose and defend specific recommendations for the company.
  • 56. · To develop an industry analysis by describing the competitors, products, selling techniques, and market conditions in a given industry (from textbook). Next, create an action plan that details how you will conduct the case analysis including assigning roles and tasks to specific project members. The action plan should include a calendar of events with specific team members assigned to tasks. An Executive Summary is a required deliverable in your calendar of events. Please note the Executive Summary is not due until Topic 7; however, your action plan will help inform the Executive Summary. While APA format is not required for the body of this assignment, solid academic writing is expected, and documentation of sources should be presented using APA formatting guidelines, which can be found in the APA Style Guide, located in the Student Success Center. You are not required to submit this assignment to LopesWrite. Part 2: Summary and Outline (Topic 4) Part 2 is designed to draft your executive summary with exhibits. Refer to Steps 1-12 outlined in your textbook. Develop the best way to addresses the selected aspect of the strategic management process that the team chose to focus on in Part I. Identify and apply the tools needed to complete your analysis. Find outside resources and information to help authenticate your analysist. These tools will be featured as exhibits in your Executive Summary that is due in Topic 7. Provide a 300-500 word summary and outline of your findings including three to five sources. This assignment uses a rubric. Please review the rubric prior to beginning the assignment to become familiar with the expectations for successful completion. You are required to submit this assignment to LopesWrite. Refer to the LopesWrite Technical Support articles for assistance. Part 3: Executive Summary with Exhibits (Topic 7) Write a 500-750-word Executive Summary with Exhibits.
  • 57. This assignment uses a rubric. Please review the rubric prior to beginning the assignment to become familiar with the expectations for successful completion. You are required to submit this assignment to LopesWrite. Refer to the LopesWrite Technical Support articles for assistance. © 2016. Grand Canyon University. All Rights Reserved. 2