Ford & Firestone’s Tire Recall The Costliest Information Gap in History Nicole Gibson Kevin Howe Melissa Rorison Nigel Vanderlinden Ashley Yantzi

Issue Identification The Ford/Firestone crisis occurred as a result of poor information management and the absence of effective database systems. Ford, Firestone, the NHTSA, and FARS tracked and recorded data independently of each other. Critical data elements were fragmented across these databases – no central repository existed and little to no information sharing occurred. This resulted in incomplete information, or ‘knowledge gaps’, within each of the participants database systems making it difficult to uncover the source of the problem.

Analysis Separation of Databases and Data Elements led to ineffective management of information: FARS - Government database used to track defects that cause fatal accidents. Gaps: Did not track the type/brand of tires on vehicles involved in fatal accidents. NHTSA - Information regarding complaints, accidents, number of deaths. GAPs: did not track tires involved in collisions, only the vehicles themselves

Analysis Ford - Collected data about problems in other countries and defects of tires, tracked warranty data on parts of vehicle other than tires Gaps: lacked the warranty data on tires Firestone -Tracked data regarding the amount of tires returned under warranty Gaps: possessed information on warranty data, factory quality test, field research none of which pointed to anything wrong with tread separation No party had a complete view of the information Each side blamed each other for the failure It took too long for the issue to be brought to the public’s attention – more lives lost

Alternatives Integrate tire and vehicles warranty data Ensure that all databases are linked across industry, institutions, and geographic regions Create a central database housing all critical data elements (Ford, Firestone, government & safety associations) No tires on vehicles – they are too dangerous 4 Proposed Solution 1 2 3 Low High Level of Integration

Evaluation of Alternatives Pros Cons Integrate warranty data Minimal cost Defect patterns more readily identified - Data is still fragmented among industry and government sectors Link databases -Enables information sharing among all parties -Defect and accident patterns more readily identified Proprietary information exposed Development may be costly Central database -Most comprehensive -Defect and accident statistics centralized Who maintains and owns it? Costly to develop and manage Difficult to manage No tires on vehicles Hovercrafts are COOL No more tire fires - Loss of factory jobs

Recommendation Implement an interorganizational system across Ford, Firestone and government agencies. Integrate defect and accident statistics across regions and institutions and link databases to better identify patterns that would be cause for concern

Implementation Key Actions: Form Implementation Team consisting of management from each party Standardize information collection among all participants Integrate database systems to allow for information sharing across regions and institutions Monitor and evaluate integrated system on a continuous basis

Evaluation of Ford’s Proposal Ford proposed “Early Warning System” Real-time data included from all geographic regions and manufacturers Proactive approach to detecting defects Patterns of problems flagged for further inspection – good idea Bridgestone not on board with this

Conclusion Ford & Firestone had a problem with tire tread, And a lot of people wound up dead. Their data bases were incomplete, Integrating information would have eliminated the heat. The congress was really mad, Because they didn’t tell the public about the problems they had. Separation of info made it hard to find a trend, So the Ford/Firestone relationship came to an end.

Questions?