Ford and the Global Strategies of Multinationals: The North American Auto Industry

By Isabel Studer-Noguez | Go to book overview

7

Ford's global strategy

As explained in previous chapters, traditionally Ford's international operations were a source of strength that allowed the company to maintain its position as the second largest auto maker in the world and to respond to GM's competitive moves. During the worst years of the industrial recession in 1970s, those operations provided the cash that saved the company from bankruptcy, and gave it key products that were essential to stem its competitors' moves while it invested in new product development. Today, and even if its US operations still represent the bulk of Ford's total operations and world assets, its foreign operations still make substantial contributions to the company's strong performance and leadership in the industry.

As the previous chapter demonstrated, the company's long-term strategy of adopting the industry's new best practice of production and the strategic importance of its US operations (as production site, market, and source of revenue) explained the paradox that Ford did not fully utilize the advantage of having an extensive network of foreign operations, which were also superior to its competitors. Once Ford decided to use its foreign assets in order to maximize efficiency it did so on a trial-and-error basis. It was not until April of 1994, when Ford 2000 was launched, that Ford undertook the most comprehensive worldwide reorganization ever undertaken by the company. The underlying aim was to transform the company's organization from one based on regional profit centers to a global car-manufacturing business organized by product line. The program was built on the basis of several organizational reforms and innovations that had been previously introduced to exploit corporate competencies throughout Ford's network of subsidiaries around the world. In the year 2000 that global strategy was again modified to recuperate Ford's regional competencies, which had traditionally constituted the basis of that company's strength in different markets around the world. The global organization that managed global priorities in manufacturing, purchasing processes, and technology resources and platforms, introduced by Ford 2000, was maintained.

The last organizational changes introduced at Ford are so recent that it makes it difficult to evaluate how the company's worldwide operations are presently structured. Assessing the extent to which a multinational enterprise has succeeded in implementing a global integration strategy is further complicated by the different views that exist about the meaning of such strategies. As

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Ford and the Global Strategies of Multinationals: The North American Auto Industry
Table of contents

Table of contents

  • Title Page v
  • Contents ix
  • Figures xi
  • Tables xiv
  • Acknowledgments xvii
  • Abbreviations xix
  • 1 - Introduction 1
  • 2 - Ford Motor Company's Multidomestic Strategy 14
  • 3 - Ford of Canada 30
  • 4 - Ford of Mexico 51
  • 5 - The 1970s 73
  • 6 - Ford's Survival Strategy 98
  • 7 - Ford's Global Strategy 118
  • 8 - Successful Bargaining in a Situation of Increasing Interdependence 142
  • 9 - Export Dynamism 161
  • 10 - A North American System of Production 187
  • 11 - Conclusion 218
  • Notes 235
  • Bibliography 254
  • Periodicals (Newspapers, Newsletters, and Magazines) 275
  • Appendix 1 276
  • Appendix 2 302
  • Appendix 3 326
  • Index 351
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