Ford Motor: The business model and strategies applied by Dell could benefit many companies if they cared enough to adopt them, including Ford Motor company. Currently, Dell is leading in PC business market. In deed, a ten thousand dollar investment in Dell stock ass of January 1991 surpasses the two million-dollar mark today.
In particular, Dell’s marketing strategy has surpassed those of other heavyweight PC manufacturers, including such big names as IBM and Compaq. As a tradition, all computer manufacturers used retailers to sell their products. However, Dell adopted a cost-effective technique of eliminating all middlemen and selling its computers directly to the customers.
This way, Dell is able to save 3-5% in inventory costs which retailers would have consumed unnecessarily. This paper discusses the possible benefits Ford Motor Company would enjoy if it adopted Dell’s business model.
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To paraphrase one Michael Dell, virtual integration facilitates faster and efficient response to customer needs than any other model. It also builds closer relationships with suppliers and customers.
With the ever changing business environment, Ford will continue to be produce efficiently but that will just about it. However, virtual integration will make Ford more efficient and enable the company to respond to change promptly. The following flow charts compares Ford’s existing supply chain strategy to what it would look like if it were based on Dell’s supply chain approach.
Hitt, M.A., Ireland, R.D. & Hoskisson, R.E. (2011). Strategic Management: Concepts and
Cases: Competitiveness and Globalization (10th Ed). Connecticut: South-Western Cengage Learning.
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