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Ford Believes That The Four Cornerstones Of Essay

Ford believes that the four cornerstones of competitive advantage are efficiency, quality, innovation and customer responsiveness. Ideally, the company would be able to execute on all of these at once, something that is a challenge for even the best firms. However, if that is how Ford wants to compete, then the pursuit of these advantages must be tied into the company's strategy, and for these to be a genuine competitive advantage Ford must exceed the capabilities of its competitors in these facets of the business. This paper will analyze these facets in respect of Ford's culture and how well it executes these vis-a-vis its competitors. Ford's Strategy

Unlike its major domestic competitors, Ford turned down a government bailout on the assumption that it would be better able to execute its vision for the future without the influence of government ownership. This was met with optimism in some quarters when aspects of the company's strategy came to light (Schwartz, 2010). The company's vision entailed improving relations with its workers, focusing on long-term results rather than quarterly and selling off underperforming units. One of the immediate effects of this has been in innovation. Ford shifted its focus towards designing cars that consumers of today wanted. The result is that there is more optimism about the company's innovation pipeline than there was in the mid- to late-2000s (Ibid). Also fueling the innovation pipeline was a commitment that the company made to financing new product development, even as it restructured its balance sheet (Muller, 2012).

The innovation pipeline and responsiveness...

For example, Ford last year announced the launch of several new models in the Chinese market. The company has a total of 20 new engines and 15 new vehicles coming online by 2015. There is a focus on increased fuel efficiency, again something that consumers have been wanting for years. These successes are allowing Ford to gain traction in China and rival General Motors, which to this point is much bigger in that market (Forbes, 2011).
Ford has struggled, however, with the quality aspect of its strategic plan. The company fell all the way down to 20th of 28 automakers in a Consumer Reports survey on reliability, with Japanese makers taking 9 of the top 10 spots. This report was damning of Ford's efforts -- the Explorer SUV, Focus compact and Fiesta in particular -- and as a result the company's stock price was hit. The improved perception of quality in Ford vehicles is one of the reasons the company's sales have been on the rise. Consumers are hearing that Ford is committed to improving quality and they are responded, so reports that show that the company's renewed commitment has yet to yield success hurt the company with respect to competitive advantage (Welch, 2011). Unfortunately for Ford, these findings are supported by other surveys, such as one by JD Power and Associates that also showed a dip in the quality of Ford vehicles (LeBeau, 2011).

Comparison with Competitors

While all of the major U.S. automakers have executed some sort of turnaround, Ford's is generally believed to be stronger. The company was able to give its…

Sources used in this document:
Works Cited:

Forbes. (2011). Ford hits $14 with China growth, fuel efficiency focus. Forbes. Retrieved April 7, 2012 from http://www.forbes.com/sites/greatspeculations/2011/11/29/ford-hits-14-with-china-growth-fuel-efficiency-focus/

LeBeau, P. (2011). Ford quality tumbles in JD Power survey. CNBC. Retrieved April 7, 2012 from http://www.cnbc.com/id/43511239/Ford_Quality_Tumbles_in_J_D_Power_Survey

MSN Moneycentral: Ford (2012). Retrieved April 7, 2012 from http://investing.money.msn.com/investments/stock-income-statement/?symbol=F

Muller, J. (2012). Key leaders in Ford turnaround to retire; Mulally not going anywhere. Forbes. Retrieved April 7, 2012 from http://www.forbes.com/sites/joannmuller/2012/02/09/key-leaders-in-ford-turnaround-to-retire-mulally-not-going-anywhere/
Schwartz, T. (2010). Alan Mulally -- Making Ford a model for the future. Harvard Business Review. Retrieved April 7, 2012 from http://blogs.hbr.org/schwartz/2010/04/alan-mulally-making-ford-a-mod.html
Welch, D. (2011). Ford quality tumbles as Japanese win Consumer Reports study. Business Week. Retrieved April 7, 2012 from http://www.businessweek.com/news/2011-10-25/ford-quality-tumbles-as-japanese-win-consumer-reports-study.html
WSJ. (2012). Ford turnaround means big rewards for top executives. Wall Street Journal. Retrieved April 7, 2012 from http://blogs.wsj.com/drivers-seat/2012/03/08/ford-turnaround-means-big-rewards-for-top-executives/
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