FORD Motor: Navigating Digital Transformation
1. Introduction:
Ford Motor Company is an automotive brand that manufactures cars, trucks, SUVs, and luxury vehicles. It is an American multinational brand, and its headquarters are in Dearborn, Michigan, U.S. The founder, Henry Ford, started the company in June 1903. The Ford Motor Company possesses two major brands: Ford and Lincoln Premium. The Ford Motor Company sells automobiles and commercial vehicles like trucks under the brand name Ford while introducing its luxury cars under Lincoln Premium. Ford has done successful business worldwide, especially in the U.S. (Anand, 2021). In 2015, Ford became the second-largest company in the U.S. The new competitors in the world gave Ford a tough time during the company’s expansion (Anand, 2021). But in 2017, Ford was the fifth largest company in the world. In 2017, Ford sold 6,607,000 vehicles in the world through different channels. The Ford F-series made them famous among customers, and it became their unique selling point that helped Ford compete in the market. Figure (Jurevicius, 2021) shows that Ford’s F-series outsold its competitors and captured a 31.8% share of the pickup vehicle market.
1. The Case for Change:
Ford is an old company that successfully established its trademark in the market and built loyal customers. But many reasons are forcing Ford to evolve with time, including technology, competitors, digitalization, and the pandemic.
1.1.Threats:
In this era of technology, advanced companies like Apple and Tesla in Silicon Valley threaten the old automobile companies. The old companies like Ford have been leading the market till now when the old technology has been replaced by artificial intelligence, machine learning tools, and IoT. Tesla is working on self-driving and electric vehicles that challenge the old technology and heavy engines introduced by the Ford Motor Company. Electrification of vehicles solves the problems of pollution and global warming. Moreover, they also address the lack of petroleum and the increasing fuel price. The second biggest threat to Ford is the design of on-demand vehicles. Some companies are offering customers to get their customized cars, which is affecting the business of luxury cars. The integration of machine learning and A.I. tools is capturing a large audience’s attention, and many people want such digital and smart tools in their cars. Companies are also working on self-driving cars that customers can use on-demand instead of owning. This step will cause a problem for the companies that are in the business of manufacturing cars. (Lee, 2016).
1.2.Digital Transformation:
Ford Motor Company has taken the evolution in the automobile industry seriously and has taken some initiatives to counter it. In 2016, the Ford company started a new subsidiary known as Ford Smart Mobility LLC. They started the new subsidiary in Tesla’s hometown of Palo Alto. The Ford Motor Company has adopted the technique of self-disruption to counter digital threats (Lee, 2016). Moreover, the company has launched its first electric vehicle, the Mustang Mach-E, which accelerated the company’s digital transformation. The company has focused on the development of APIS. It was observed that APIS is necessary for digitalization, like remote start options in the winter season, fuel delivery, cloud integration, and self-driving technology. The development of an API also ensures the safety and privacy of the data. Ford has also integrated the Adobe Experience Cloud into their system. This feature allows the company to connect with its customers, and, as a result, it can provide a more personalized experience to the customers (Harmon, 2021).
1.3.Objectives:
Ford Motor Company is taking several steps to cope with the evolution of the automobile industry. Moreover, the pandemic has also affected the automobile industry, and due to the pandemic, they have to accept digitalization. All the car-purchasing procedures demanded physical interaction, but Ford took a bold step and provided an online platform where you can buy any of its products or online services from an e-website. Their objective is to overcome the effects of the pandemic through digitalization, and it also saves the time and effort of customers. Ford aims to deal with its customers like a family. They are integrating digital tools that give information about customers’ wants and how they can improve their vehicles. The company has an objective to add A.I. and machine learning tools that will aid the company in keeping a record of the data from pre-sales to post-sales, marketing, and its impact (Edwards, 2021).
2. Capture Insights:
If you want to succeed in digital transformation, then it is necessary to research properly and gather insights before making harsh decisions. These insights are important as they reduce the risk factor. These insights help you avoid mistakes and also inform you about your progress.
2.1.Required Insights:
In business, each company needs different types of insight to understand its weak points and market position. These insights also help you in taking future decisions. Ford needs insights about digital disruptions as through this insight; they can disrupt themselves in a controlled manner; otherwise, these digital disruptions can cause damage to the company. They also need to gather customer data about the issues in their vehicles and what features consumers expect from the company. If the company does not care about such insights, its competitors can easily capture the market by launching the required product. They also need to capture insight about their vehicle as it can help them track their vehicle quality. They can provide services to their customer through this insight or warn them about the issue that will increase customer satisfaction with the company (Archibald, 2021).
2.2.Techniques to Capture Insight:
There are different techniques to capture various insights that are required to make progress. To capture insights from the customer, they can gather data by interacting with the customers through websites, social media, and online services. A tool like adobe analytics is a perfect example of interacting with the audience and gathering the required insight. Ford can install similar techniques and gather information through various channels (Edwards, 2021). These techniques can gather the information which will make the design procedure feasible. Moreover, Ford can use such insight to market its product at the right place and increase sales by sending the right product to the right place (McCormick, 2021). To gather information about vehicles and their performance Ford has to use digital sensors and tools inside the vehicles that can give records about the car’s performance; hence the company can build a system that can make customers aware of tuning and servicing of the car when required (Marr, 2019).
2.3.Tools to Capture Insight:
To capture insight from the customers, the only possible way to collect a large amount of data is to use I.T. Tools and websites. Ford Motor Company is currently using D-Ford to gather the data. It is a human-centred design lab that collects data from customers, employees, and partners and uses this data to contribute to all design phases. Ford can use that lab to gather information about famous automobile trends among enthusiasts. They can use it to work on worldwide data and expand their business to new limits (Lopez, 2020).
Ford uses Argo AI technology in its vehicles, providing A.I. tools and neural networks that give information about the vehicle’s condition. They can use such A.I. tools to track the car’s movement, fully automate it, or even make it a self-driving vehicle (Marr, 2019). A.I. tools have proved that you can mould data in any manner to explore new possibilities.
3. Fast Decision-Making:
There is a lot of competition in the market, and you need to make fast decisions to overcome your competitors. You need to consider the insights and then act quickly according to them so that you are the first to introduce the innovation. These insights can help you stay one step ahead compared to your opposition.
3.1.Techniques for informed decision-making:
Ford can use Big Data Analytics in a more channelized way and is trying to collaborate with Google to help install Google maps and voice technology in its vehicles. This feature will connect the customers with the company’s care centre. The company can use this data to understand the shortcomings and failures of their vehicles. Similarly, the data gathered through Big Data can be used to tweak incoming vehicle design procedures and features. You can also use this information to gather the weak points of new technologies and work on them perfect them (Mixson, 2021). Ford has integrated A.I. tools in such a manner that can provide you with the inventory for used cars. This information can help dealers to get information about the car and put the right price on it. It will increase your car’s resale value and improve the company’s brand image.
3.2.Technologies that support informed decision-making:
Ford has developed five D-Ford Labs in Detroit, London, Melbourne, Palo Alto, and Shanghai. They have developed these labs whose whole purpose is to make decisions based on the information and insights gathered from customers, company employees, and business partners. These labs aim to infuse a problem-solving mindset by assessing the situation smartly. Moreover, the company has used I.T. and A.I. tools to gather information about trends in different areas and markets. Hence, they have worked on an A.I. optimization model that guides the company about which model should be sent to which area of Europe. Ford has also adopted machine learning tools that help the supply chain department and help in managing their inventory depending on the demand.
4. Acquire and Engage Talents:
It is necessary to hire the right people for the job; otherwise, there are a lot of examples in which companies failed in digital transformation because their employees were not familiar with the technology and unable to benefit from it. The company needs to introduce a few employees that can act as a catalyst in the digital transformation.
4.1.Techniques to Acquire Talent:
Ford needs young talent who has updated knowledge and can learn new technology in a short period. The most talented students are in universities. Hence, ford can connect their company with universities. At the current level, Ford has linked itself with the Society of Women Engineers, the National Black MBA Association, and the National Society of Hispanic Engineers (Starner, 2016). The company offers internships with stipends to students linked with such professional organizations. They can take one step further, connect their company to the university, and guide them about the skills they expect students to possess. They have also launched an apprentice program that allows them to find and hire talent after training (Lightfoot, 2021).
4.2.Techniques to Engage Talent:
Ford need to understand the requirement of the employees to engage the talent. Moreover, they need to provide some goal-oriented jobs and break down internal functional barriers as they implement the upskilling program. They need to offer good rewards and attractive wage packages to stick talented employees in their company. These employees are more worthy than digital tools. The company has also focused on creating a diverse environment that shows the modern mindset of the company and encourages talent from different areas to join and work with the company. The company has also launched training programs that attract youngsters with good knowledge but lack experience and practical skills. You can engage them through such programs and offer jobs to the right candidates after the workshops (Lightfoot, 2021).
5. Create a Digital Ready Culture:
Digital transformation is only possible when the company provides a culture that supports it and allows the employees to adopt the transformation gradually. Leaders and managers play a huge role in creating a digital-ready culture. Ford was a revolutionary leader, and the company can use its ideology while creating a digital-ready culture.
5.1.Attributes of a leader to build a digital-ready culture:
The leader’s behaviour toward transformation is a key factor in how the company will react to the change. The leadership of Ford was successful as he was willing to take bold decisions, and in the same way, the leader who is leading the digital transformation must be able to take bold decisions. The leader needs to have empathy and appreciation for his hardworking employees. The leader must have behaviour that embraces the change and allows the technology to replace the old methods (Writer, 2019).
6. Steer Collaboration:
Collaboration and teamwork can solve a lot of problems in the organization. In digital transformation, all the departments must help each other and guide others to mould themselves according to the recent technology. One purpose of digitalization is also to increase collaboration so that the company’s productivity increases.
6.1.Initiatives to improve collaboration:
To improve collaboration, the company needs to take the initiative; otherwise, the digital tools will not be enough to increase collaboration among employees, and it can create confusion. The company needs to raise awareness about digital tools that help employees easily exchange ideas and material. The company can create a communication network that will increase transparency, as Ford Motor Company implemented in their supply chain department to improve sustainability and ensure communication among departments (COLOGNE, 2022).
6.2.Tools to improve collaboration:
Ford has worked hard to improve the collaboration among its department. It has also addressed the issue of using different I.T. tools. The Catena-X Automatic Network is an example of an IT Tool that Ford has used to enhance communication among supply chain departments. The company needs to build more tools like it that can solve communication issues (COLOGNE, 2022).
7. Select your Leaders:
The most important factor that can decide the success rate of digital transformation is the leader that drives the digital transformation. It is necessary to have the right mindset before starting the digital transformation. The leader should have the guts to set clear goals for the organization as it reduces a lot of uncertainties. The leader must know how to find opportunities and use them correctly for the company’s betterment. The leader must understand the risk that comes along with digitalization. A good leader understands that digitalization doesn’t need to increase the company’s value, but it is just a tool that can cause profit or loss. The leader must understand the technology deeply to explain it to the employees and help them adapt to it. Leaders should be able to deal with uncertainties and have the experience and knowledge to counter them (Perri, 2022).
References:
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