Ford Motor Company: Generic & Intensive

Growth Strategies
Updated Feb 5, 2017 Pauline Meyer
http://panmore.com/ford-motor-company-generic-intensive-growth-strategies

Ford Motor Company’s market position as the fifth biggest automobile manufacturer in the
world is supported through the firm’s intensive growth strategies aligned to its generic strategy
for competitive advantage. Intensive strategies are used to support organizational growth. In this
case, Ford’s business growth is dependent on the varying emphases on market penetration,
product development, and market development. On the other hand, a generic strategy defines the
general approach used for business competitiveness. Ford’s generic strategy changes over time,
although its original generic strategy of cost leadership remains a significant force. Ford’s
generic strategy and intensive growth strategies determine the company’s approaches to grow its
business.

Ford Motor Company’s generic strategy (based on Michael Porter’s model) shows the general
trajectory of developing the firm’s competitive advantage. The intensive growth strategies define
specific approaches used to support Ford’s growth.

Ford Motor Company’s Generic Strategy (Porter’s Model)

Ford’s generic strategy has changed over time. Initially, Ford’s generic strategy was cost
leadership. This generic strategy supports business competitive advantage on the basis of cost
reduction and low prices to attract customers. In the early 1900s, Ford’s vision was to make its
automobiles affordable for working-class Americans. To apply this generic strategy, the firm
developed the assembly line method to minimize costs and maximize productivity. Ford
succeeded in attracting customers based on this generic strategy. A strategic objective for
competitive advantage based on this generic strategy is cost minimization through process
streamlining.

However, Ford Motor Company’s generic strategy did not protect the business from competition
with General Motors. By 1927, GM overtook Ford to become the largest American automobile
manufacturer. GM used its generic strategy of broad differentiation to offer a wider array of
products. Americans were gaining higher wages and started valuing style and design, and not just
low prices. Today, given its current One Ford plan, Ford Motor Company has been moving its
generic strategy to emphasize differentiation for competitive advantage. Ford still maintains its
cost leadership generic strategy. However, the firm is moving toward the broad differentiation
generic strategy to compete against firms like GM and Toyota. Thus, a strategic objective based
on Ford’s current generic strategy adjustment is product innovation to gain stronger competitive
advantage.
Ford Motor Company’s Intensive Strategies (Intensive Growth Strategies)

Market Penetration. Ford’s primary intensive growth strategy is market penetration. This
intensive strategy entails selling more products to current customers to grow the business. Ford
applies this intensive growth strategy by increasing the number of its dealerships and increasing
sales volume. This intensive growth strategy is linked to the strategic objectives of increasing
customer retention and increasing sales to existing customers. This intensive strategy is linked to
Ford’s generic competitive strategy by highlighting the benefits of low costs and increasing
differentiation to gain a bigger market share.

Product Development. Ford Motor Company uses product development as its secondary
intensive strategy for growth. This intensive growth strategy involves offering new products to
increase sales revenues. Ford applies this intensive strategy through R&D investments for new
products, such as the all-electric Ford Focus Electric. A strategic objective based on this
intensive growth strategy is to increase R&D investments for product innovation to improve
business growth and competitive advantage. This intensive growth strategy supports Ford’s
generic strategy adjustment toward broad differentiation.

Market Development. Market development is only a minor or supporting intensive strategy for
Ford’s growth. This intensive growth strategy involves providing entirely new products or
entering new markets or market segments. Ford already has global operations, which means that
market development is not as significant as it has been for the business in its early years. Also,
Ford has not taken any significant strategic action to enter entirely new industries or market
segments in recent years.

References

 Ford Motor Company (2015). Business Strategy.

 Ford Motor Company Form 10-K, 2014.
 Glazer, R. (1999). Competitive Advantage Through Information-Intensive Strategies. Handbook
of Services Marketing and Management, 409.
 Merchant, H. (2014). Configurations of governance structure, generic strategy, and firm
size. Global Strategy Journal, 4(4), 292-309.
 Miller, D. (1992). The generic strategy trap. Journal of Business Strategy, 13(1), 37-41.
 Parnell, J. A. (1997). New evidence in the generic strategy and business performance debate: A
research note. British Journal of Management, 8(2), 175-181.
 Varadarajan, P., & Dillon, W. R. (1982). Intensive growth strategies: A closer
examination. Journal of Business Research, 10(4), 503-522.
Ford Motor Company’s Vision Statement,
Mission Statement
Updated Feb 5, 2017 Andrew Thompson
http://panmore.com/ford-motor-company-vision-statement-mission-statement

Ford Motor Company is the fifth largest automobile manufacturer in the world. Ford’s mission
statement guides the strategies needed to achieve or exceed this market position. A company’s
mission statement defines the kinds of actions needed to fulfill organizational goals. On the other
hand, Ford’s vision statement drives its global organization to reach higher performance levels.
A firm’s vision statement specifies the desired future situation or condition of the business. In
this case, Ford Motor Company’s mission statement and vision statement are determinants of the
firm’s success and strategic direction in the international automotive industry.

Ford Motor Company’s vision statement and mission statement imply the potential strategic
direction of the firm. Investors and business partners use these statements in evaluating Ford’s
performance and organizational development.

Ford Motor Company’s Vision Statement

Ford’s vision statement is “people working together as a lean, global enterprise for automotive
leadership.” The company also explains, “Automotive leadership is measured by the satisfaction
of our customers, employees, investors, dealers, suppliers and communities.” Thus, Ford’s vision
statement has the following major points:

1. Global leadership
2. Emphasis on stakeholders
3. Lean business

The global leadership point of the vision statement indicates that Ford Motor Company wants to
become the top player in the international automotive market. Ford is currently the fifth biggest
in the world, and the second largest U.S.-based automobile manufacturer, behind General
Motors. In this regard, Ford still has more to work on to reach its vision statement’s point of
global leadership. On the other hand, the vision statement’s emphasis on stakeholders is achieved
through Ford’s enhanced HR policies, as well as corporate social responsibility strategies for
employees, customers, investors and others. Ford’s vision statement also highlights lean business
operations, which the company already achieved through its assembly line methods. Thus, based
on its current condition, Ford Motor Company needs to work on growing its sales to achieve
global leadership and fulfill its vision statement.

Ford Motor Company’s Mission Statement

Ford’s mission statement is “One Team. One Plan. One Goal.” This mission statement is also
known as the “One Ford” mission, which is part of the “One Ford” plan that was unveiled in
2008 under CEO Alan Mulally’s leadership. Ford explains that the expanded form of its mission
statement is as follows:

 One Team: “People working together as a lean, global enterprise for automotive leadership, as
measured by: Customer, Employee, Dealer, Investor, Supplier, Union/Council, and Community
Satisfaction.”
 One Plan: “Aggressively restructure to operate profitably at the current demand and changing
model mix; Accelerate development of new products our customers want and value; Finance
our plan and improve our balance sheet; Work together effectively as one team.”
 One Goal: “An exciting viable Ford delivering profitable growth for all.”

Ford Motor Company’s current mission statement is a response to the challenges it experienced,
especially in relation to market risks and the American recession and global financial crisis that
started in the late 2000s. Prior to implementing the One Ford mission statement, the company
had disparate product lines in different markets. With the One Ford mission statement, the
company now focuses on creating consistency in product and service design and quality globally.
The mission statement emphasizes teamwork to achieve synergy at Ford. The One Plan and One
Goal components also indicate that the mission statement focuses and unifies Ford’s global
organizational efforts to improve business performance and achieve the global leadership point
in the company’s vision statement.

References

 Bartkus, B., Glassman, M., & McAfee, B. (2006). Mission statement quality and financial
performance. European Management Journal, 24(1), 86-94.
 Ford Motor Company (2015). Business Strategy.
 Ford Motor Company Form 10-K, 2014.
 Kirkpatrick, S. A., Wofford, J. C., & Baum, J. R. (2002). Measuring motive imagery contained in
the vision statement. The Leadership Quarterly, 13(2), 139-150.
 Long, C., & Vickers-Koch, M. (1994). Creating a vision statement that is shared and works. The
Journal for Quality and Participation, 17(3), 74.
 Lucas, J. R. (1998). Anatomy of a vision statement. Management Review, 87(2), 22.
 Mullane, J. V. (2002). The mission statement is a strategic tool: when used
properly. Management Decision, 40(5), 448-455.