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Ford Restructuring Essay

1446 words - 6 pages

Assignment #1 – Chapter 5 Case – “Ford Motor Company”Pamela SmithG. Stan Reeley, Jr., Ph.DBusiness MangementOctober 30, 20101. The case creates four options to choose from. Discuss at least three criteria the company should use to decide which of the four listed options is best and the reasons why each criterion should be used. One criterion to be discussed is to find out where the company is losing the most money. In order to start trimming down the losses the management must first find out where the leakage is greatest and then decide which area needs to be downsized first. The decision could be made to shut down plants in North America to only ...view middle of the document...

For example, one of the possible decisions could be to sell the PAG but while this process is still being though through the fuel prices may decrease dramatically. With the decrease in fuel prices consumers may be inclined to return to purchasing SUVs. The Land Rover may potentially become the top selling SUV for the company. So an option could be to keep the Land Rover just in case fuel prices decrease but to sell the other cars in the PAG. The automotive industry may experience a significant t increase in sales thus allowing the company to maintain the benefits afforded to the union workers. With this possibility in mind there should be a team in place to be sure they are taking a close look at the income in the event sales increase enough to not have to decrease the benefit packages for the current employees. The Unites States economy may bounce back and consumers may be able to put money back into the economy which may cause our stocks to rise and allow consumers to go out to purchase more cars. As a result, the North American production may need to increase thus negating the need to close all of the plants in the United States. An alternative would be to close some plants where the economy may be slowly increasing versus all of the plants.3.Discuss how an effective action plan can be created and how progress can be monitored.. An action plan must be in place with the specific steps (the how), people (the who) and the resources (the what) and the time period (the when) of how the goal will be reached. (Williams, 2010). Specific steps should be in place to measure how the economy is doing in order to decide which plants need to be closed in the North American market. Financial analysts must be tracking the economy for the company by utilizing their expertise within the next 6 months to get the necessary data to upper management. If the company does not have competent financial analyst onboard they may need to hire a consultant to help track and measure the economic data. Monthly meeting need to be held to get a status as to how the market is doing as it relates specifically to downsizing plants. One short term goal could involve real estate prices. If real estate market is still trending down then the cost of building rents would directly impact operational costs of the plants. Once the data has been tracked then management can make the decision on which plants, if any, need to be closed. If the results prove the data validates the strength of the American dollar then the operations in North America would prove to be profitable again. Salaries would be payable along with the overhead costs needed to effectively run each plant. 4. List at least three steps that make-up a workable plan and explain why each is important. Three components of a workable plan include the cooperation of top, middle and first-level managers (Willams, 2010). The top managers are responsible with giving the overall vision and position of the...

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