Facing the Future for Business - Essay Example

?Case Study: Facing the Future Table of Contents 0 Introduction 3 2.0 Critical Evaluation of the Impact of the Changing Business Environment Imperatives on the Ability of Organisations to Achieve Business Goals. 4 2.1 Corporate Social Responsibility 4 2.2 Crisis Management 9 2.3 Globalisation 9 3.0 Identifying and Evaluating Appropriate Management Responses to Changes In Future Scenarios 12 4.0 Critical Evaluation of the Impact on Organisations of Implementing Management Change to React To Environmental Change 15 5.0 Conclusion 16 6.0 References 17 7.0 Bibliography 20 1.0 Introduction The study is conducted regarding the changes in business scenario that may create challenges for an organisation in future. An organisation in order to face the challenges and to maintain sustainability develops various strategies. In the paper, Ford Motor Company has been focussed as the company in order to conduct the study. The challenges that may be faced by Ford Motors in relation to its corporate social responsibility, crisis management and globalisation aspects have been highlighted. There are various challenges that may be faced by the company in the three aspects of its business environment. The company may face huge challenges in its future from the strategies that it has been undertaken to fulfil its corporate social responsibility. In case of crisis management, the company has executed certain strategies to overcome the challenges but this may generate dilemmas in the changing business scenario of future. The globalisation strategies that have been developed by the company also may create challenges in near future. The study seeks to discuss about the role of managers in changing the entire management system to fulfil the aspects of changing business scenario. It also entails to discuss the impacts of changing management scenario on the company. 2.0 Critical Evaluation of the Impact of the Changing Business Environment Imperatives on the Ability of Organisations to Achieve Business Goals. 2.1 Corporate Social Responsibility Corporate Social Responsibility relating to the automobile industry entails to safeguard the social as well as ecological responsibility at the entire production site. The products of the automobile sector are connected to different aspects of social, environmental, health as well as safety. There are huge challenges that are faced by the automobile manufacturers in relation to their country. Beside fuel economy and emission of CO2, other key ecological challenges are furnishing vehicles by means of specific filters, strategies related to protection of climate, promoting fuel-efficient driving and recycling systems along with substitute method of car fuelling. The future success of the company is depended on the performance standard, safety as well as comfort in opposition to ecological challenges along with social challenges. The environment is calling for more environment-friendly cars in future after the crisis in the year 2000. Thus, for surviving within the market, the automobile companies are responsible to develop sustainable strategy (Visser & Et. Al., 2010). Ford Motor Company, for maintaining its sustainability in the business environment, has developed various strategies in relation to corporate social responsibility. The company tries to stabilise the climatic change by decreasing the release of greenhouse gas (GHG) and energy from operations. To lower the GHG emission, in their manufactured products they have developed flexibility as well as capability in accordance to the market conditions (Ford, 2008). There are five challenging factors of corporate social responsibility of Ford Motors in which the company has given prior emphasis. These are climate change, human rights, mobility, vehicle safety and sustainability (Munich Business School, 2010). The company has developed various strategies in relation to the five CSR activities. However, due to the limitations in strategy implementation, the company may face challenges with regards to contemporary business environment in future. In case of ‘climate change’, Ford Motors has introduced worldwide environmental technology so as to provide vehicles with fuel efficiency. This would result in low discharge of greenhouse gases. The strategy also enables to decrease the weight of the car. The company has developed sophisticated tools and techniques to meet the sustainable objective for the reduction of CO2 (LCT, 2009). However, the green technology may bring challenges for the company in future. The challenges may have impacts related to cost, time and environment. The incorporation of such technology in the cars would make the cars expensive for the company to manufacture as well as increase the retail price. Thus, it would be a dilemma for general people to purchase car. As a result, it would be a challenge for the company to survive in the market and to increase the sales volume with such a sophisticated technology. Due to installation of batteries and ‘internal combustion engines’ the speed of the car is slow. At the time of accident this type of car also becomes risky and it becomes a hard task to save the passengers. Though the company has implemented the innovative strategy for its responsibility towards society, in future it may become a challenging factor for Ford Motors (Funk Works, n.d.). ‘Mobility’ is one of the challenging issues for the company. The company, by taking into consideration the facts of mobility, has implemented various mobility programs. As the numbers of cars are rising in developing countries as well, therefore Ford may need to execute more strong strategies and mobility programs in future. The company has conducted the programs in a few countries and also integrated the strategy in terms of corporate social responsibility. However, to reduce the air pollution and environmental impacts there will be a high challenge for the company to arrange the program globally (Ford, 2008). ‘Human Rights’ are also provided importance by Ford Motors in their operations, partnership as well as supply chain. The people within the communities of the company are provided their rights. The suppliers are also encouraged to abide by human rights’ regulations in their productions. In this context the company involved is engaged in CSR activities (Ford, 2008). In future, it may be a challenge for Ford Motors to fulfil their obligation towards the issues of human rights. Though it is focusing towards the welfare of communities and suppliers, in relation to maintain its corporate social responsibility activities, the situation may not be similar in future. To perform in line with its changing business environment, the company may need to change its strategy of human rights for its growth. The company has executed various innovative ‘Vehicle Safety’ strategies on a worldwide basis. The accident avoidance features such as forward-looking radar as well as vision sensor is incorporated in several cars to reduce accident failure (Ford, 2008). There may be challenging situation with radar and vision sensor because the radar may limit its function in mist, fog, heavy rain and snow. At that time, it becomes quite hard to determine the range. The speed also cannot be measured by vision sensor. Though incorporating radar in designing the car results in more accuracy and speed, therefore the EMC (Electromagnetic Compatibility) needs to be considered during the designing process. The regulations of EMC also vary from region to region. Thus, it becomes a challenging task for the company to operate with these technologies in future. There may be sudden changes in technology and process and the company to adapt to such changing business market needs to develop different strategies. Therefore, the transforming strategy of CSR i.e. from one technology to another may be implemented (Cambridge Consultants, 2002). Sustainability of Ford Motors implies that after financial crisis hit the company, it has transformed its production from truck towards small as well as medium-sized cars. In order to gain sustainability in the market, the company has lessened the emission of CO2 from the products. The company has also implemented elementary CSR strategy (Munich Business School, 2010). In order to sustain in the market the company has transformed its production of products from trucks to cars. The sales of truck are falling and the company may not be able to meet quickly the changing demand in the market. This would result in challenging scenario in the market in future. The company has started to focus only on the production of small hybrid cars, but sudden alteration in business environment can lower their sales of small cars. 2.2 Crisis Management Ford Motor Company has faced various challenges during the time of crisis. The various strategies have been executed by the company to manage during crisis situation. The strategy of ‘One Ford’ and that of Ford Fiesta would facilitate the company to differentiate from its competitors in crisis. The failure of these two aspects would lower the value of Ford. In time of crisis, there were four strategies that assisted the company to restructure its operations again. There is a chance of failure of One Ford strategy that has been adopted by the company due to standardisation around the regions that provides cost savings. On a global basis, the company has developed the cars with green technology. But, continuous reduction in fuel prices may lower the sales of hybrid cars around the world and the consumers may switch to larger vehicles (Bender, 2009). In future, due to continuous changes in business environment the company requires to be prepared and can firmly act and function positively with respect to manufacturing, dealers, suppliers and product development (Ford, 2009). 2.3 Globalisation Globalisation in present context has changed the face of the automobile industry. In future as well the aspects such as safety requirements as well as commitment towards environment can see further changes. The impact of liberalisation has turned the national market to be globalised. As a result, there is more expansion of new markets. Companies also are required to be concerned about the local taste and preference of the customers. Ford Motors has launched ‘world car’ in the market a few years back. However, in present context of globalisation it would not have been successful. For fulfilling the new demands of customers the company is facing huge challenges. Original Equipment Manufacturer (OEM) needs to cut down the product lifecycle to satisfy the demand of consumers (IBM, n.d.). In the digital world, there is a demand for incorporation of hardware as well as software parts in the automobiles. This results in more complexity in the cars and brings product failures, less value in warranty cost and customer dissatisfaction. The company will be overburdened by the digital technology. The product lifecycle also may get reduced. The individual needs can be accomplished by implementing latest and flexible technology in the production process. It has become a core business demand for the Ford Motors to easily adapt to the changes that takes place in the environment. These are the challenges that may be faced by the company in future with change in business environment (IBM, n.d.). The seven strategic challenges that an organisation needs to be acclimatised with to keep up with the changes that may take place are: “brand management, core competency management, customer relationship management, software management, product development management, quality management and expansion management”. Proper brand management enables Ford Motors to discriminate the products from the competitors. Customer relationship management assists a company to fulfil the requirements of customers and response to the changes of customer behaviour. Core competency management facilitates the company to provide prior focus towards internal strength and render the company to be flexible with new technologies (IBM, n.d.). Software management enables the company to make standardisation of software as well as strategic partnership. Quality management facilitates the company to develop flexible maturity level. Product development management entitles to make wider competencies in relation to innovative technologies. Expansion management facilitates to determine the possible requirements in changing business environment (IBM, n.d.). The company has developed customer relationship management, brand and core competency management strategies. But, there is a chance of arising challenging issues for the company within the global working environment from the above corporate social responsibility challenges in future. 3.0 Identifying and Evaluating Appropriate Management Responses to Changes In Future Scenarios The changes in future scenario of business environment will enable the management of Ford Motor Company to response towards the changes. The management changes its culture, people and process of the work environment so that the company may function effectively in relation to the changes. The change in culture within an organisation is a challenging task for managers. But, due to the development of the company and its growth, cultural change is essential. In certain cases, innovative technology that may be developed by Ford Motors in future to operate in competitive business will enable the managers to change its workplace culture. The managers should understand the people regarding the changes and its benefits. The managers can encourage innovation within the culture of the workplace by providing flexible schedules, a few meetings and interdisciplinary project teams. It is essential to change the culture of the company in order to adjust the changing scenario of the workplace (The Wall Street Journal, 2011). An organisation cannot change without people. Change in the perception of people is also a challenging task of managers. The flexible work environment and regular motivation will alter the perception of the employees. As a result, the employees will be more efficient towards the work and improve the performance level. In changing business scenario, it is necessary for the company to possess efficient employees for better production. Regular guidance and inspiration to the employees enable them to commit towards changing scenario. The attention of people needs to be redirected as it is considered as an important part of change. The concepts regarding the new demand from the market must be clearly highlighted to the employees as it helps in changing the attitude of the people. To work for environmental protection the perception of people also needs to be changed so that they can provide importance to the environment. The employees should think of the issues and then only the sustainability of the company can be achieved. It is the task of managers to discuss properly to the employees regarding the environmental impact and its relation to the automobile industry (Durant, n.d.). The entire process of production system is also needed to be changed within the company. The new requirements in the market enable the managers to change the production process of the company. The new production process of Ford Motors would work effectively if the managers develop skilful employees. To become accustomed to the changing scenario, the managers efficiently perform to make flexible the process of operations (The Times 100, 2011). Source: (Info Net, 2009). Therefore, from the above discussion it has been observed that it is a great role of managers to proceed in line with the changing business scenario and to motivate the employees to adapt to the possible changes. The organisational culture, people and processes are considered as vital aspects of an organisation that need to be altered with the changing business environment. 4.0 Critical Evaluation of the Impact on Organisations of Implementing Management Change to React To Environmental Change The managers of Ford Motor Company have to change the culture, people and process within the work environment. This change is due to the alteration of environmental change in business environment. This results in entire changing scenario in the company. As a result, it would have an impact on the company and its operational activities. The change is required as it enhances the production capacity of the employees. The changes enable the employees to work efficiently with the demanding situation so that they can adjust any changing environment. The culture of the company gets transformed resulting in more flexibility in the work environment. The employees are motivated in such a way that it increases more commitment towards work. In the present context, business environment is constantly developing and changing, thus it is the prime concern of managers to observe cautiously regarding the change perspectives. For being an automobile company, continuous focus towards environmental protection is essential. By focusing on the environment the reputational image of the company increases. Therefore, change in the management decisions will alter the perspectives of the organisation. 5.0 Conclusion From the above discussion, it has been observed that Ford Motor Company will face several challenges in future if there is change in business environment. The company has developed corporate social responsibility strategies such as lowering down the emission of CO2 from the products they manufacture. As a result, the number of hybrid cars has increased and it has reduced the production of trucks. But, this concept would not work in a long run if a few changes take place in the business environment. The strategies that have been implemented for crisis management may face challenges if the there is change in business environment in future. The company in the globalisation period has adopted the strategies such as ‘world car’, but his would not perform strongly in future changing scenario. These challenges can be overcome if there is a transformation in the management system. The manager of the company performs effectively and plays significant role in implementing the perspectives of various changing business scenario in the environment of Ford Motors. The management if changes according to the culture, people and process within the work environment then it will enable effective functioning of the company. If these changes are conducted then it may result in increase in productivity level as well as growth and development of reputable image of the company. 6.0 References Bender, R. D., 2009. Threats. Strategic Report for Ford Motor Company. [Online] Available at: http://economics-files.pomona.edu/jlikens/SeniorSeminars/oasis/reports/F.pdf [Accessed July 09, 2011]. Cambridge Consultants, 2002. To support 360 degree detection, a variety of different sensor technologies are being adopted. How Innovation Will Change Your Car. [Online] Available at: http://www.cambridgeconsultants.com/downloads/library/innovation_day_03/how_innovation_changes_car.pdf [Accessed July 09, 2011]. Durant, M. W., 1999. Managing Organizational Change. CRF Online. [Online] Available at: http://www.crfonline.org/orc/pdf/ref4.pdf [Accessed July 09, 2011]. Ford, 2009. Key Economic Factors and Trends Affecting the Automotive Industry. Ford Motor Company/ 2009 Annual Report. [Online] Available at: http://www.annualreports.com/HostedData/AnnualReports/PDFArchive/f2009.pdf [Accessed July 09, 2011]. Ford, 2008. Blueprint for Sustainability. Introduction. [Online] Available at: http://corporate.ford.com/doc/sr07-ford-sustainability.pdf [Accessed July 09, 2011]. Funk Works, No Date. Hybrid Cars Advantages and Disadvantages. Green Technology. [Online] Available at: http://funkworks.org/hybrid-cars-advantages-and-disadvantages.html#more-327 [Accessed July 09, 2011]. IBM, No Date. The On Demand Challenge. Challenges For The Automotive Industry In An On Demand Environment. [Online] Available at: http://www-935.ibm.com/services/us/imc/pdf/g510-3956-challenges-automotive-on-demand.pdf [Accessed July 09, 2011]. Info Net, 2009. Introduction. Change Management. [Online] Available at: http://www.jiscinfonet.ac.uk/infokits/change-management [Accessed July 09, 2011]. LCT, 2009. Ford Details Its Long-Term Green Vehicles Strategy. Operations. [Online] Available at: http://www.lctmag.com/operations/news/10084/ford-details-its-long-term-green-vehicles-strategy [Accessed July 09, 2011]. Munich Business School, 2010. Ford’s Approach to CSR. University of Applied Services. [Online] Available at: http://www.munich-business-school.de/intercultural/index.php/Corporate_Social_Responsibility:_Concept_and_current_Overview_in_Automotive_Industry_Within_Europe,_America_and_Asia [Accessed July 09, 2011]. The Times 100, 2011. The Organization and Change. Strategy. [Online] Available at: http://www.thetimes100.co.uk/theory/theory--the-organisation-change--334.php [Accessed July 09, 2011]. The Wall Street Journal, 2011. How to Change Your Organization’s Culture. Management. [Online] Available at: http://guides.wsj.com/management/innovation/how-to-change-your-organizations-culture/ [Accessed July 09, 2011]. Visser, W. & Et. Al., 2010. The A to Z of Corporate Social Responsibility. John Wiley and Sons. 7.0 Bibliography Banerjee, S. B., 2007. 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