Strategic Transformation of Ford Motor Company Assignment

Strategic Transformation of Ford Motor Company - Assignment Example Ford Motors is a leading global automaker company based in the United States. In recent years, through sustained strategic direction and leadership, the company has positioned itself among the world’s leading companies in the automobile industry. Porter’s five forces model consists of elements such as bargaining power of buyers, bargaining power of suppliers, the threat of substitute products, threats of new entrants and competitive rivalry within an industry. The five forces are illustrated accordingly. Bargaining power of suppliers in relation to industry context can be examined by assessing certain determinants such as labor, services, and raw materials among others (Karagiannopoulos & et. al., 2005). The power of the suppliers depends on the efficiency as well as the inefficiency of the market forces (Purdue University, 2010). With regard to Ford Motors, the bargaining power of suppliers in the industry is quite high. It has emerged as a major threat for the automaker companies globally in cent years. However, Ford has been able to devise prudent strategies to significantly mitigate the threat of supplier power. For many parts suppliers, Ford is a key organization to obtain sustained contracts in the long run. Thus, any discontinuation of the requirements of Ford might be quite difficult for the supplier companies to deal with. Ford has trimmed down its number of suppliers from 3300 to around 1600 in the past decade as a part of its strategy to solidify a relationship with suppli ers and improve its grip on the suppliers bargaining power (Dornbach-Bender & et. al., 2009). Bargaining power of buyers signifies the impact that the customers provide on the profitability of a business organization. The buyers in the market have more powers when certain specified conditions meet such as an industry has a number of companies delivering the products thus facilitating the buyers with varied choices in terms of companies and products.