FORD: TAURUS TEAM Group 2: Reena Villamor Mabel De Guzman Irene Mojica Joanne Evangelista

Strategic Vision To become the No. 1 consumer company for automotive products and services through delivery of quality and innovative products and services globally .

Corporate Objectives To achieve USD1B net income in 2004. To increase global market share to 30% by 2004. 2001/2002 at 10%, 2003 at 20%, 2007 at 30% due to AFTA and free trade, more competitors (more realistic goal) Net income increase fr market share increase and innovations, but factored in expenses

Present Strategies Description Objective Basis Develop an innovative and quality vehicle to satisfy car market. Objective Increase market share to 30% by 2004. Basis Superior Research and design team.

EXTERNAL ENVIRONMENT ANALYSIS

Potential Changes in the Macro-environment Economic Increase in fuel prices; gasoline shortage decline of US auto industry Technological invention of small, fuel-efficient cars Social Increase in population Change in consumer preferences for cars

Determining Threats/Opportunities: Five Forces Changes in the Macro Increase in Fuel Prices Change in Preference Invention of Small Cars INTENSITY OF RIVALRY HIGHER HIGHER HIGHER Numerous Competitors Higher Higher Higher Slow Industry Growth Lower Higher Lower High Exit Barriers Higher Higher Higher THREAT OF NEW ENTRANTS: LOWER HIGHER HIGHER Economies of Scale Lower Higher Higher Capital Requirement Lower Lower Lower Access Distribution Channel Higher Higher Higher Government Policy N/A N/A N/A THREAT OF SUBSTITUTE PRODUCTS AND SERVICES HIGHER HIGHER HIGHER BARGAINING POWER OF BUYERS LOWER HIGHER HIGHER OF SUPPLIERS HIGHER LOWER LOWER CONCLUSION THREAT THREAT THREAT

Threats & Opportunities Increase in fuel prices Changing consumer preferences Invention of Small Cars Opportunities Increase in population

INTERNAL ENVIRONMENT ANALYSIS

Value Chain Analysis MARGINS

Value Chain Analysis: Primary Activities Inbound Logistics Operations Outbound Logistics Marketing Sales Customer Service Parts and components selection and delivery Checking of quality and inspection of inbound materials Effectiveness of production control systems to improve quality and reduce cost. Appropriate automation of production process. Efficiency of finished goods warehousing and inventory activities. Effectiveness of market research to identify customer segments and needs. Development of an image of quality and a favorable reputation Means to solicit customer input for product improvements. Promptness of attention to customer complaints.

Value Chain Analysis: Support Activities Procurement: System Sourcing, entering into long term contracts with qualified and reliable suppliers and “must see before program” Technology Development: Ability of work environment to encourage creativity and innovation, Qualification and experience design and process experts, Success of research and development activities in leading to product and process innovations. Human Resource Management: Effectiveness of procedures of recruiting and training, Good relations with trade unions, Strong levels of employee motivation through pride of workmanship, active participation by managers and technical personnel in professional organizations. Firm Infrastructure: Establishments of Product Development “Team Taurus”, High level of information systems support, Quality of strategic planning system.

Strengths and Weaknesses Strong Brand Image Strong Research and Development Team Strong Management Support Good relationship with suppliers Weaknesses Quality Control

Family Business Model: Business Axis: Maturity Ownership Axis: Sibling Family Axis: Passing the Baton

Personal Values: Risk taker Strong advocate of Innovation Consultative vs Autocratic

Strategic Map GROUP E GROUP A GROUP B GROUP C GROUP D Automotive & Land Transport Industry GROUP E FORD Motors, General Motors 5-Price Policy 1 Price Policy GROUP A 4-Price Policy Toyota Motors, Honda Motors GROUP B Nissan Motors, Mitsubishi Motors, Chrysler Co. 3-Price Policy GROUP C GROUP D Kia motors, Hyundai Motors 2-Price Policy BMW Co., Mercedes Co. 1-Price Policy COUNTRY CONTINENT 1-2 CONTINENT WORLD Geographic Scope

Corporate Strategies: Allotment of more budget to Research and Development for continuous innovation. Objective: To achieve market share and income targets Basis: Changing Customer Preferences

FORD Competitive Advantage “TAURUS” More spacious vehicle More Innovative Sedan Lower Maintenance requirement “Japanese Quality, European Styling and a ride for a modest price”.

Competitive Advantage of FORD Sources of Advantage superior financial support superior R&D resources Key Success Factors Positional Advantages Realized more innovative car for a modest price Performance Rewards satisfaction and loyalty of customers higher profits higher market share Investment In Renewal increase investment in R&D investment in employee training & development investment in technology transfer Competitive Dynamic Erode Advantage competitors acquiring of Ford employees customer changing value preference Barriers To Imitations