sc word 2000 (buersmeyer) 1 ford motor company e-business initiatives brian buersmeyer strategic...

SC Word 2000 (Buersmeyer) 1

Ford Motor CompanyFord Motor Company

E-Business InitiativesE-Business Initiatives

Brian BuersmeyerBrian BuersmeyerStrategic Planning Manager, e-BusinessStrategic Planning Manager, e-Business

Material Planning and LogisticsMaterial Planning and Logistics

Copyright 2000 by Ford Motor


Recap recent announcementsRecap recent announcements

Overview of auto-xchangeOverview of auto-xchange(now Newco)(now Newco)

Link between e-Business andLink between e-Business andFord’s overall corporate strategyFord’s overall corporate strategy

Presentation Overview


Recent Developments

Goal:Goal:Reduce working capital by shrinking excessReduce working capital by shrinking excessinventories and wiping out costly rebatesinventories and wiping out costly rebatesneeded to sell vehicles off dealer lotsneeded to sell vehicles off dealer lots

RetailingRetailing

How:How:Set up BuyerConnection web site and joinedSet up BuyerConnection web site and joinedMSN CarPoint site, where consumers can orderMSN CarPoint site, where consumers can ordercustom-assembled cars, track their progress,custom-assembled cars, track their progress,and apply for financingand apply for financing

Strategic Partner:Strategic Partner:Trilogy CorporationTrilogy Corporation


Goal:Goal:Improve factory efficiency by anticipatingImprove factory efficiency by anticipatingcustomer demand; funnel data on consumercustomer demand; funnel data on consumerpreferences to vehicle designerspreferences to vehicle designers

MarketingMarketing

How:How:Team up with Yahoo!, Carpoint, iVillage, andTeam up with Yahoo!, Carpoint, iVillage, andbolt.com to monitor the interests and buyingbolt.com to monitor the interests and buyingpatterns of web-surfing customerspatterns of web-surfing customers

Strategic Partner:Strategic Partner:MicrosoftMicrosoft

Recent Developments


Goal:Goal:Improve service with 24-hour access;Improve service with 24-hour access;gather data on customer problems and cutgather data on customer problems and cutcosts with automated helpcosts with automated help

Customer Service

How:How:Consolidate and upgrade customer call centersConsolidate and upgrade customer call centersworldwide; enable owners to get online help, worldwide; enable owners to get online help, manage warranty service through manage warranty service through OwnerConnection web siteOwnerConnection web site

Strategic Partner:Strategic Partner:TeletechTeletech

Recent Developments


Goal:Goal:Make Ford the carmaker for an internet-savvyMake Ford the carmaker for an internet-savvygeneration; collect revenue through fee-based generation; collect revenue through fee-based servicesservices

Digital DashboardDigital Dashboard

How:How:Equip new cars with web access, satellite phoneEquip new cars with web access, satellite phoneservices, and e-mail capabilitiesservices, and e-mail capabilities

Strategic Partner:Strategic Partner:SprintSprint

Recent Developments


Goal:Goal:Make the workforce web-literate so that it canMake the workforce web-literate so that it canlearn to identify and leverage full potential oflearn to identify and leverage full potential ofe-businesse-business

How:How:Offering all 350,000 employees (hourly andOffering all 350,000 employees (hourly andsalary) a computer, printer, and net access for $5 salary) a computer, printer, and net access for $5 per monthper month

Strategic Partner:Strategic Partner:PeoplePC, HPPeoplePC, HP

Recent Developments

Wired WorkersWired Workers


Goal:Goal:Automate procurement function and combineAutomate procurement function and combinethe leverage of multiple OEMs and suppliers;the leverage of multiple OEMs and suppliers;eliminate waste throughout supply chaineliminate waste throughout supply chain

SuppliersSuppliers

How:How:Launch auto-xchange (now Newco) Launch auto-xchange (now Newco) e-marketplace with GM, DaimlerChrysler, e-marketplace with GM, DaimlerChrysler, and key tier 1 suppliersand key tier 1 suppliers Strategic Partners:Strategic Partners:Oracle, Commerce 1, CiscoOracle, Commerce 1, Cisco

Recent Developments


Auto-Xchange/Newco Overview

Commitment to Commitment to deliver all software, deliver all software, hardware and hardware and implementation implementation services to launch services to launch Auto-XchangeAuto-Xchange

Auto-Xchange Operating PrinciplesAuto-Xchange Operating Principles

• Create a market open to the entire industry, including other Create a market open to the entire industry, including other OEMs, all tiers of suppliers, and dealer networksOEMs, all tiers of suppliers, and dealer networks

• Operate independently and without bias, with initial guidance Operate independently and without bias, with initial guidance from Ford and Oraclefrom Ford and Oracle

Auto-Xchange Operating PrinciplesAuto-Xchange Operating Principles

• Create a market open to the entire industry, including other Create a market open to the entire industry, including other OEMs, all tiers of suppliers, and dealer networksOEMs, all tiers of suppliers, and dealer networks

• Operate independently and without bias, with initial guidance Operate independently and without bias, with initial guidance from Ford and Oraclefrom Ford and Oracle

AUTO-XCHANGEAUTO-XCHANGE

Commitment to deliverCommitment to deliverproduction and production and non-production purchasesnon-production purchasesthrough Auto-Xchangethrough Auto-Xchange


Key Elements of Auto-Xchange

AUTO-XCHANGEAUTO-XCHANGE

• Visibility across supply chainVisibility across supply chain• CollaborationCollaboration• Optimized inventory managementOptimized inventory management

• Visibility across supply chainVisibility across supply chain• CollaborationCollaboration• Optimized inventory managementOptimized inventory management

Multi-tier, Integrated Ford Supply Chain

E-enabled Platform for Traditional

Procurement

Multiple Vertical Trading

Communities

• Real time bidding• On-line RFQs• Internet based transactions

• Real time bidding• On-line RFQs• Internet based transactions

• Consortium buyingConsortium buying• Liquid market for surplus materialsLiquid market for surplus materials• Spot market for commoditiesSpot market for commodities

• Consortium buyingConsortium buying• Liquid market for surplus materialsLiquid market for surplus materials• Spot market for commoditiesSpot market for commodities


Link to Ford’s Corporate Strategy

Move from company push to consumer pullMove from company push to consumer pull

Become the Dell Computer / Cisco of the Become the Dell Computer / Cisco of the automotive industryautomotive industry

““Put the consumer in control”Put the consumer in control”


Company Push

Moving to a Consumer-driven Company

Vehicle DesignVehicle Design

MarketingMarketing

• Please everyonePlease everyone• More is betterMore is better

• Pricing strategy is budget-basedPricing strategy is budget-based• Use incentives to balanceUse incentives to balance supply and demandsupply and demand

ManufacturingManufacturingand Supplyand Supply

Dealer NetworkDealer Network

• Keep the plants runningKeep the plants running• Capacity constraints drivenCapacity constraints driven by program budgetsby program budgets

• Sell from dealer inventorySell from dealer inventory


Moving to a Consumer-driven Company

Consumer Pull

Vehicle DesignVehicle Design

MarketingMarketing

• Hit the sweet spotHit the sweet spot• 95/5 rule95/5 rule

• Pricing is market-drivenPricing is market-driven• Brand is paramount Brand is paramount

ManufacturingManufacturingand Supplyand Supply

Dealer NetworkDealer Network

• Build to scheduleBuild to schedule• Supply chain capacitizedSupply chain capacitized based on consumer demandbased on consumer demand

• Sell from pipeline basedSell from pipeline based on consumer demandon consumer demand


Key Challenges

Asset intensityAsset intensity

Franchise lawsFranchise laws

WorkforceWorkforce

Complexity of the undertaking -- all Complexity of the undertaking -- all

elements are linked togetherelements are linked together


Q & AQ & A

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