Case Study Analysis and Solutions

Case ID: 614010

Abstract:
Case Solution & Analysis for Ford vs. GM: The Evolution of Mass Production (A) by Willy Shih
This case explores the very different paths taken by the Ford Motor Company and the General Motors Corporation in the first three decades of the twentieth century. Henry Ford's Model T was a car for the masses. After considerable experimentation, Ford Motor perfected a mass production system that converted the vast majority of jobs in the factory into routine tasks. It pioneered the moving assembly line, and it pursued processes that became increasingly integrated and mechanized. While it's single-minded focus on cost minimization led to spectacular market success for a time, the resulting inflexibility made it difficult for the company to respond to market changes. This created an opportunity for General Motors and others, particularly in the face of technological shifts to closed-body designs and metal stamping technology, as well as the marketing-led idea of the annual model change. The case offers a setting to examine several frameworks: exploration versus exploitation, the emergence of dominant designs, and vertical integration versus transaction costs and supplier hold-up. The A case closes with the question of what GM should do about supplier Fisher Body. The B case summarizes the shift to all-steel body stamping and engine manufacturing as the core technologies for automobile production, and how these changes made it difficult for Ford to maintain its first-mover advantage.

Keywords:
Advertising strategy, Business growth, Business history, CAD, CAM, Change management, Collaborative innovation, Community development, Corporate strategy, Cross functional management, Execution, Growth, Incubators, Innovation, International R&D, Product design, Product development, Product positioning, Regional economic integration, Revenue growth, Social Security, Vertical integration, Work history, Ford vs. GM The Evolution of Mass Production (A) Case Solution

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