Recommendations for Ford to Plan for the Future - Case Study Example

Future of FORD Student’s Name Institutional Affiliation Introduction Time and again it has been proven that change is inevitable. Change is also constant and so whether positive or negative it has to occur. Ford Motor Company faces the same fate and several years down the line it will not be where it is now. Technology changes and so does tastes and preferences and soon people will be choosy about the type of cars they drive and the combustion fuel the cars use. What will drive this change will therefore be the tastes and preferences of people as influenced by technological advancements [Dee16]; people will demand more than just a car, they will want more smart features. Costs of fuel will also be a factor in the near future as it has already began to influence the buying behavior of customers for vehicles. As of now many people avoid those vehicles which consume a lot of fuel and go for those that consume less. Petroleum may also be depleted or become scarce bringing about the need to have alternative sources of fuel. Another aspect that will change the motor vehicle industry in the future is environmental conservation. There are already calls for energy-efficient machineries today but as time goes by these calls and cries will intensify. Global warming and climate change will be more severe in future than it is now and there will be more need to conserve the environment by using vehicles that are energy-efficient and that also renewable and environmentally-friendly energy sources. These factors will shape the future of the motor vehicle industry and companies in the industry, including Ford Motors, have to prepare for this future [Pau16]. This paper looks at these expected changes and formulates a hypothesis as well as looking at the weaknesses and business impacts of the changes then give recommendations for Ford to plan for the future. Gathered Data Technology has changed over the years and this change has been so rapid and demanding that some business have collapsed due to failure to keep up with the pace. The technology changes influence how consumers buy items and each manufacturer and seller has to keep up with the changes if they are to remain relevant in the market. From the old days of few mainframe computers to these days of global internet coverage and computers everywhere, the next world will usher in what has already become to be seen now-Internet of Things (IoT) [And16]. IoT concept looks at a future where everything is connected to the internet; everything is smart. Much of these smart gadgets are already available today; for instance smart watches, smart TV sets, and smart houses among others. Though some are still in the pilot stages of implementation in future most of them will be fully functional and that will bring about the need for smart cars. We can already see this in fiction movies; cars which have AI agents that converse with the driver, driverless cars, cars which connect to the internet and search for required content as well as cars which can do a lot more things while connected to other devices. People watch this movies and even those who don’t still know that as devices and gadgets get smart so should cars. We’re looking at a future where people will only purchase smart cars so that they can connect them with the other gadgets in their IoT. By then any company that would not have incorporated the idea of IoT into their production will not survive in the market. Only those companies that would have incorporated the technology will survive. Ford Motors must also take up this matter into mind and make necessary plans to ensure their future is bright [Kir16]. The cost of fuel is the other source of change in the motor vehicle industry that Ford Motors must be prepared to deal with. Fuel costs are known to influence the sales and prices of vehicles today with changes in gasoline prices commonly seen affecting the motor vehicle industry [Car17]. Less vehicles are bought when the price of petroleum and/or petroleum products is high and vice versa. Fossil fuels will also be depleted at some point in life and even if they are not they will still not have a place a place in the all-electric world of the future. The prices of fossil fuels fluctuate today and this gives a shift in the demands for vehicles but a time is coming when there will be cheaper ways of powering vehicles and the expensive fossil fuels will be a thing of the past at such a point in time; that time is fast approaching. Electric vehicles have already started being tested and with their entrance into the market exits fossil fuels. These electric cars will be charged just like other electrical appliances and the UK had already set to do a test of wireless charging of electric cars as early as 2015 [The15]. Electricity is not only cheap but also does not get depleted as fossil fuels because it is a renewable source of energy. Such cars will be cheap to maintain and many people will purchase them [Rol16]. Non-electric cars will be less purchased and with time they will become extinct together with their companies if those companies would have failed to plan adequately and effectively for such changes. Ford has no option but to plan for this change as well. The other source of a change in the motor vehicle industry is environmental concerns [Kar07]. The automotive industry is already the leading environmental pollutant mostly through the exhaust gases and greenhouse gas emissions; together with the aviation industry which is the leading air pollution sector. It is the one sector that carries much of the blame for the increasing global warming and climate change witnessed today. The arctic ice is melting, water levels rising in other areas and deserts forming in others. There already are cries against these changes and the same cries will intensify as time goes by. Other areas of the world economy that leads to pollution such as the ICT industry have started adopting green measures especially signaled by the birth of concepts such as Green ICT. Same demands are already made for the motor vehicle industry and Green Cars is the way to go. Manufacturing cars that use energy efficiently to minimize environmental pollution has been the only solution for a while now. However, a total shift to Green Cars requires going green completely and this will focus both on the car manufacturers and those in the fuel industry. Fossil fuels pollute the environment more and so other energy sources need to be used [Kar07]. One of the alternative energy sources for the green solution is electricity and so electric cars will be more common in the near future. We have also seen the tests done to bring about hydrogen vehicles and since hydrogen gas burns to produce water, such a fuel is very good for a green solution. Motor vehicle companies like Ford Motors have to put these issues into consideration. Synthesis of Data The cited sources above support the factors that are going to shape the motor vehicle industry of tomorrow, the motor vehicle industry of which Ford Motors is part. In summary, the sources present a technological advancement as a factor that will influence the buying behavior of motor vehicle customers but shifting their tastes and preferences as far as motor vehicles are concerned. IoT will play a major role in this and as houses, TVs and other things will be smart people will also demand for a smart car. Fuel costs are also outlined as a factor that will affect the future motor vehicle market in that many people will be preferring cheaper to maintain vehicles in terms of fuel consumption. With time fossil fuels will be replaced by cheaper and renewable energy sources like electricity. Industries will therefore be forced to manufacture electric cars if they are to remain in the business failure to which they will become extinct. The last agent of change has been said to be environmental concerns. With climate change and global warming on the rise and environmental pollution arising from the motor vehicle sector on the rise as well, relevant bodies and agencies will step in and demand for green cars that will be developed to use fuel efficiently and also use fuel that can be renewed, if possible. This sources will cause the motor vehicle industry and market to change completely and fast so as to fit the changing environment and factors. The data shows that these changes have already began to occur and as they continue into the future it is important for Ford Motors and other automotive companies to plan for a change. Hypothesis Changes will take place in the motor vehicle industry as we grow into the future and this changes will determine whether a company survives or not. These changes will take place as a result of customers’ change in preference and taste caused by technological advancement; the increased cost of fuels which also goes hand in hand with the depletion or reduced quantities of fossil fuels and also; environmental conservation concerns that will push for Green Cars-cars that do not entirely harm the environment or do so at lower severity than the existing cars. It is most likely than these changes will occur as already noticed in the trends in automotive industry today. This is the alternative hypothesis while the null hypothesis is that no change will occur in the motor vehicle industry and that there won’t be need for the respective companies to make any plans for changes. Weaknesses/Unknowns Several weakness/unknown issues exist in this hypothesis especially because it is almost hypothetical as it looks into the future. One of the unknowns is the exact time when most of the changes will start appearing or when they will start to be felt by all involved and all expected to be affected by the change. The other unknown is the risks that will surround such a future technology that will engulf the motor vehicle industry. How will the auto insurance of the time work? What will the insurance be safeguarding against? Smart vehicles will not easily fall prey to car thefts because there will be a way get them back because being smart vehicles they must be built with such situations in mind. They may be able to contact the owners or maybe refuse to ignite in the hands of the wrong people or may be able show their location to enable tracking. If these are to happen then what will the cars be insured against? These are the most common unknowns in the matter. Business Impact These changes that are expected to occur and affect the business in many way. The business impacts of such changes can be so severe that other business may close down while others may stand out and thrive. The way of doing business will change and new business models will be adopted in the motor vehicle industry [Car17]. One of the impacts will be towards the sales of vehicles. There will be a decreased demand for petroleum vehicles due to the costs and environmental hazards associated with them. Vehicle companies dealing in those vehicles will slowly run out of business and then at some point in time when electric and other non-petroleum driven cars they will become extinct-no more petroleum cars. Those companies that would have laid proper foundation for the change will not incur as much losses and will not run out business as the rest. They will thrive and succeed to greater levels. Ford Motors should be in this category as they plan to implement the changes. Some other vehicle companies that have already become to implement this future changes will start reaping handsomely because demand for such vehicles will increase rapidly. Smart vehicles like the Google Driverless Car as well as electric vehicles land hydrogen vehicles will be selling fast and the companies will not run out of business. The changes will also create opportunities for other industries to thrive. For instance, the ICT industry will thrive because many aspects of the smart devices are a product of the ICT industry. The changes will also mean that fewer companies would be left in the market and so competition will be expected to be between the few companies and each will be implementing different measures to ensure they outcompete the others. Ford Motors should start planning for the changes now so that by that time they will be among the few companies owning the market. Recommendations There are a number of things that can be done by Ford Motors to ensure that it implements the changes that will ensure it remains relevant through the future. One of the things they can do is to catch up with and keep the pace of technological changes. It is the technological advancement that will bring about most of the changes in the motor vehicle industry and so keeping up with the pace will directly land the company to that future without having to do so much to get there. The only thing that will be done is to make the few technological changes that are deemed necessary as time goes by and then accumulatively the efforts will ensure the company stays relevant. The other recommendation for achieving this fete is by starting to invest in non-petroleum vehicles like the electric vehicles so that as time goes by users who demand them can get them. The company should then keep building electric and smart cars till they establish a strong customer base that will prove very crucial at the end. There are many smart car companies already with implementing various technologies like artificial intelligence that will ensure total autonomy of those future cars. Ford Motors should also join in the race and develop their products in such a unique way that customers will easily identify with. With the picture of the smart future in mind and the trends of the world vehicle industry, there should be an easy way for Ford Motors to remain relevant into the future and satisfy their customers with cars that are smart. It is possible for Ford Motors to achieve this target and by putting the right plans in place they’ll achieve. References Dee16: , (Pershad, 2016), Pau16: , (Gao, et al., 2016), And16: , (Meola, 2016), Kir16: , (Korosec, 2016), Car17: , (Anon., n.d.), The15: , (Priestley, 2015), Rol16: , (Hwang, 2016), Kar07: , (Gadesmann & Kuhnert, 2007), Read More