Description
The Disruption in Detroit and the Silicon Valley focuses on major firms failing to remain at their best due to disruptions within the markets. The Ford Motor Company, for instance, is one of the big companies in history that had a challenge in adapting to new technology and the company was still relying on their past glory to shine in a world that had been taken over by new technology and the participation of other players. This hurt Ford’s efforts to compete well in a market that was full of opportunity and potential. In a world that was undergoing change in the 1980s and the 1990s, Ford needed a strategy that would not only enable them maintain their name, but compete effectively and survive in the motor industry. When Mark Fields took over as CEO of Ford, he took over a company that had been grappling with low sales and revenue due to the recession that had been taking place in the automotive industry. Fields, unlike his predecessor, had in mind that Ford needed to have a disruptive innovation to survive the challenges of the 21 st Century.
Evaluation
Early Success: Given that Mark Fields had been in the corporate industry for over 25 years, he had the experience that as required by a Chief Executive Officer to turn around the fortunes of a company. He also had the advantage of having worked with Ford for almost all his career, and therefore, he had a clue of the mistakes that he should not make while running the company. Declining sales, struggling with suppliers and making massive losses was what the company had undergone under the leadership of Mulally as the CEO. He therefore had to focus on ways to cut the manufacturing as well as the employee headcount at the same time maintaining the high sales volumes as well as profitability. He therefore chose to focus on new markets in different geographical areas. This meant that Fields, and his executive team at the company had to think of new technologies to help the company keep up with the growing competition in the automotive industry which was driven by the changes in customer preferences. Fields focused on ways of reinventing the company, maintaining its profitability as well as positioning the company for future competition in the future ("Ford is undergoing a huge business transformation—but its future still includes dealers", 2018) . He therefore ensured that all the vehicles that the company would produce, especially pickup trucks, would last for many years so as to boost the customer confidence in the Ford Company.
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Competitors: Companies such as Tesla, Google and Apple served as a reference point for Ford over what it needed to do in order to survive in the Silicon Valley. Focusing on new technology and other innovations is hat this companies had done and it is what Ford needed to do for it to stay in business-adapt. Companies like Corvette and General Motors had already invested in new technologies for their vehicles, mostly the sports cars and Ford needed to level up for them to stay in business. Offering high performance vehicles, therefore, is what Ford had to focus on. Mark and his team, therefore, chose to focus on high performance vehicles, such as the Mustang, so as to stay in competition. They improved the vehicles capabilities in line with the new technology and this saved them the costs of building other vehicle that would have taken time and much cost to bring into the market. Improved performance and durability were the aspects that Ford chose to focus on and it is what gave them an edge over their competitors.
Post Success: Given that Mark Fields had worked in the company for most of his career, he was conversant with its intrigues. His highly effective operational strategies ensured that the company registered a revenue of over 150 billion dollars with a net income of 7 billion dollars and a cash at hand of 24 billion dollars. This were indicators that Ford, under the leadership of Fields, had taken a positive turn and was headed to the right direction since it also had 200,000 employees in different parts of the world. The ability of Ford to adapt to the disruptive innovations that had taken part in the automotive industry is what enabled them stay in business. With the knowledge that disruptive innovations had taken place and other companies such as Toyota were taking up the market share in Europe, Ford chose to focus on the growing middle class around the globe and made vehicles for them. By doing this, they were able to create a lasting brand name for themselves among the middle class who have a taste for new technology. The company’s electric vehicles, in-built combustion engines that delivered diesel performance were among the things that helped Ford stay in business in the competitive automotive industry. Their electric plug vehicles also attracted new customers since Ford had positioned themselves in a way that showed that they are also environmental friendly ("Introducing Ford’s Mobility Solutions for 21st Century Cities", 2018) . Had Ford focused on coming up with new vehicles instead of improving hat they already have to match the current global trends, they would have registered losses and slow growth.
Competitors: Despite making such innovations, Ford still has to deal with the competition from companies from Japan and Korea. This is because they are inventing vehicles that use electricity and their vehicles go for lower prices. This makes them suitable for the average American or global citizen. However, Ford’s strength in the truck industry and sports car industry is what keeps them ahead of the rest but they have to ensure that their vehicles are built to last so as to maintain customer loyalty.
Recommendations: To continue competing effectively in the automobile industry, Ford has to ensure that they conform to most of the global trends. This include having vehicles that are preinstalled with Google Maps to enable their users access their destinations with ease. Ford, should therefore partner with companies such as Google to ensure that their vehicles are preinstalled with the application. Building vehicles that are environmental friendly is also another thing that the company should embark on since the market is now receptive to products that are environmental friendly. Therefore, Ford should build vehicles that are both easy and pocket friendly when maintaining and at the same time vehicles that are environmental friendly. Partnership with organizations that are passionate about the environment would come in handy so as to ensure that they are doing what is environmentally correct.
References
Ford is undergoing a huge business transformation—but its future still includes dealers. (2018). Retrieved from https://www.businessinsider.com/ford-ceo-says-business-changing-dealer-network-2017-1?IR=T
http://fortune.com. (2018). Retrieved from http://fortune.com/2014/04/22/what-mark-fields-faces-at-ford/
Introducing Ford’s Mobility Solutions for 21st Century Cities. (2018). Retrieved from https://medium.com/cityoftomorrow/introducing-fords-mobility-solutions-for-21st-century-cities-f4f54883c97a
