Presentation on theme: "Ford and Firestone: Ill-Handling a Killer Scenario"— Presentation transcript:
1Ford and Firestone: Ill-Handling a Killer Scenario Peter GrellaDonald JonesJosh SerfassSara Weron
2Ford Background Mission Business Engagements Brief History We are a global, diverse family with a proud heritage, passionately committed to providing outstanding products and services.Business EngagementsMarket VenturesTarget MarketsBrief HistorySignificant eventsEvolution of CharacterHistory to DateStrategy ConsistencyPrevious strategic attempts
3Ford Background Ford Ideals Focusing on the Concern The Keys to Ford Philosophy of BusinessSegmented or IntegrativeFocusing on the ConcernOrientation of BusinessProject or productThe Keys to FordCore CompetencyCompetitive AdvantageDriving force for SuccessFord BreakdownOrganizational Structure – Type ImplementedRecognizable approach to Change – “ Plan B ”
4Ford’s Environment Internal Environment External Environment Factors StrategiesExternal EnvironmentInfluence on DecisionsCompetitionCustomersEconomyThreats and Opportunities
5Ford’s Major Players Company Executives The Infamous Whistleblower Who they are and what do they do.The Infamous WhistleblowerThe Hero, The community Champion !The GovernmentBureaucratic Red Tape, Letting down the American CitizenThe DriverTheir contribution to the messFalling Victim to being misinformed
7Firestone BackgroundHarvey S. Firestone ( ) founded The Firestone Tire & Rubber Company in Akron, OhioHenry Ford selected tires manufactured by Firestone for the first mass-produced automobiles in AmericaIn 1961, Firestone acquired Dayton TireThe Bridgestone Tire Co., Ltd. (renamed Bridgestone Corporation) was founded in 1931 in Kurume, Japan, by Shojiro Ishibashi ( ), a manufacturer of rubber-soled footwearTires were adopted by the three leading automakers - General Motors, Ford, and ChryslerBridgestone purchased Firestone in 1988
8Firestone BackgroundBridgestone Firestone, Inc., in an effort to focus more effectively on its core business units, initiated a series of changes to its corporate structure in December 2001BFS Retail & Commercial Operations, LLC, consists of a family of company-owned consumer and commercial store chains in the United States and CanadaBFS Diversified Products, LLC consists of the company’s non-tire operations in the AmericasBridgestone Metalpha is the company’s steel cord manufacturing facility.Bridgestone Industrial Products America, Inc. sells and markets industrial products
10Firestone’s Organizational Structure Product DivisionProduct OverviewConsumer TiresBridgestone Brand, Firestone Brand, Associate BrandTruck and BusOff Road Products GroupOff the Road TiresAgricultural TiresTube CompanyMotor Sports and Racing
11Firestone’s Major Players Harvey Firestone- Founded company in 1900John Lampe- Former Chairman and CEOAlan Hogan- Whistleblower “hero”Mark A. Emkes- Current Chairman and CEO
12Firestone’s Environment External FactorsCustomers- Ford, GM, Chrysler, Indianapolis 500Stockholders- Concerned with stock price and dividendSociety- Mixed feelings on Firestone productsGovernment- Federal regulationsCompetition- Goodyear, MichelinInternal FactorsMission Statement- Consistent with actions?Management and Culture- Push blame on others
13Firestone’s Strategy Action Plan Shift the blame on Ford for safety problems“No one cares more about the safety of the people who travel on our tires that we do. When we have a problem, we admit it and we fix it”- John Lampe, CEO FirestoneClose several factory plantsNow What?Option1 - Deemphasize Firestone and emphasize BridgestoneOption 2 – Firestone name obsoleteOption 3 – Salvage brand identity
14Issues GREED! Lower costs = Increased Profit Reduced Quality Questionable ProductDeteriorating RelationshipLoss of ControlLimited Exchange of Information and CommunicationMinimal CooperationUnethical Business DecisionsPre-existing Knowledge of ProblemsFordFirestone
15Issues ( Cont.) Governmental Laws and Regulations Reporting Statutes InternationalDated Tire Endurance SpecificationsRevisions ImperativePace of investigationTime LimitationsSafety Requirements on SUV’sEnhanced support for roofs
16Crisis Management Poor Leadership Which Party is Accountable? ObjectivityConcentrating on what their own company can doTrustNot Working as a TeamShift of focusProblem Solving/OptimizingUnsatisfactory Response and DecisionsLack of PreparationVs.
17Crisis Management (Cont.) Public Relation ErrorsNo Established SpokespersonTwo Companies Claiming Different ResponsibilitiesContact with Mass MediaImproper useImpact on Stakeholders and General PublicReputationsPossible LayoffsInvestment WorriesSafety Concerns
18ConclusionIn conclusion, both Ford and Firestone have some responsibility for the accidents that occurred.Both companies went about things the wrong way.Finger-pointingStubborn mindsetThere is no problemObsession with sales and profitBetter Salvage Strategy
19QuestionsDo you think the government should be blamed in the Explorer deaths and injuries? Why or why not?Yes, the government does deserve a part of the blame.NHTSA was slow in conducting it’s Firestone investigation.Federal regulators failed to stiffen standards on SUV roofs that would prevent them from collapsing during a rollover crash.Old standards
20QuestionsBased on the information presented, which company do you think was most to blame for the deaths and injuries? What led to your conclusion?We believe that Ford was more responsible, because they were aware of dangers and tried to cut costs.Ford only SUV manufacturer using grade C tires.Low inflation levels suggested.Same tires fine on other vehicles.
21QuestionsIf an Explorer driver never checks the tire pressure and drives well above the speed limit, he has no one to blame but himself in an accident-not the vehicle not the tires.” Discuss.DisagreeProduct should consider consumer negligenceIn this case, the tires were inappropriate for the vehicle anyway.
22Questions Can a firm guarantee complete product safety? Discuss. Probably not, but it can be improvedProper TestingTake the time necessaryAssume the worst case scenario