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Organization

al Structure
and Design –
Ford Motors
Advanced
Project Report discussing the Theories and Concepts of Organizational
Structure and Design of Ford Motor Company, with respect to its Dealer in
Organizationa
the UAE i.e. Al Tayer Motors. l Behavior –
MGT 4472
Ford Motor Company 201
0

Organizational Structure and Design – Ford Motor Company

Institution:

Troy University ITS Sharjah Campus

Course:

Advanced Organizational Behavior – MGT 4472

Instructor:

Dr, Farooq Khan

Email: farooq@agu.ac.ae

Group Members:

M. Usman Rafique

Ahmedshah

Nadeem Baloch

Usman Moin

Sumayya

Date: June 29, 2010

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Preface

This report have been written on a research on the organizational structure and design of Ford
Motor Company to assist and prepare the students to draw upon the theories and concepts
involved in the practical implications an organizational structure and design of an organization.
The report examines and focuses on the management levels, span of control, duties and
responsibilities of top management, and the hierarchical structure of Ford Motor Company.

With the help of detailed structure, figures, an elaborative study have been prepared to clearly
define and analyze the implications of an organizational structure and design.

M. Usman

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Table of Contents

Introduction 4

Introduction to Ford Motor Company 5

Ford’s Vision 5

Ford’s Mission 5

History 5

Al Tayer Motors 6

Literature Review 7

Methodology 8

Interview (Primary) 8

Internet (Secondary) 8

Analysis and Results of data 9

Organizational Structure of Ford Motor’s Top Management 9

Organizational Structure of Al Tayer Motors 10

Al Tayer Motor’s Divisional Structural Design 10

Chain of Command 11

Span of Control 11

Mechanistic vs. Organic Organizations 11

Summary 12

References 13

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Introduction

Organizational structure and design of Ford Motor Company is discussed and elaborated in the
report. The organizational structuring and designing is the process of structuring human and
physical resources in order to accomplish organizational objectives, and involves dividing tasks
into jobs, specifying the appropriate department for each job, determining the optimum
number of jobs in each department, and delegating authority within and among departments.

One of the most critical challenges facing managers today is the development of a responsive
organizational structure that is committed to quality; hence an organizational structure and
design of any organization must be clearly aligned to achieve an organization’s mission and
vision. The framework of jobs and departments that make up any organization must be directed
toward achieving the organization’s objectives.

The organizational structure to be developed in an organization comes out as developing mode


over time. Any organization, similar to Ford Motor Company tends to change the structure,
adding on the management levels, widening or narrowing the span of control, adopting
centralization or decentralization in an organization, and developing the chain of command for
the reporting relationships in an organization. Organizational structure and design are defined
as follows,

Organizational structure – is the formal framework by which job tasks are divided, grouped,
and coordinated.

Organizational design – is process of developing or changing an organization’s structure.

The application of the theories and concepts of an organizational structure and design are
discussed in the matter followed.

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Introduction to Ford Motor Company

Ford’s Vision

To become the world's leading Consumer Company for automotive products and services.

Ford’s Mission

We are a global family with a proud heritage passionately committed to providing personal
mobility for people around the world. We anticipate consumer need and deliver outstanding
products and services that improve people's lives.

Ford Motor Company began a manufacturing revolution with its mass production assembly
lines in the early 1900s. Today Ford Motor Company is a global automotive industry leader
based in Dearborn, Michigan, with nearly 300,000 employees and 108 plants worldwide. It
manufactures and distributes automobiles in 200 markets across six continents.

Ford in the Middle East is based in Dubai. With a team comprising various nationalities, Ford
Middle East represents true multicultural work environment.

The Middle Eastern team primarily supports the sales, marketing and customer satisfaction
operations of all Ford, Lincoln and Mercury importer-dealers in the GCC (Bahrain, Kuwait,
Oman, Qatar, Saudi Arabia, UAE), Levant (Jordan, Lebanon, Syria) and Yemen.

History

Ford Motor Company's history in the Middle East goes back to nearly 60 years. The company's
local importer-dealers operate more than 55 facilities in the region and directly employ more
than 4,000 people, the majority of whom are Arab Nationals.

Ford first appeared on the Arabian Peninsula with the F-1 pick-up truck, also known to most
Arabs, as the Red Truck, or the "wanette" – in reference to its 1-ton capacity and 8-cylinder
engine. The Ford F-Series trucks have served as the workhorse of countries around the world
ever since. The F-Series is the best-selling truck on the planet for the past 28 consecutive years.
A significant milestone in the history of Ford Middle East was reached in 2001 when the Ford
Drive communications strategy was launched in the region. This strategic move underscored an
aggressive re-positioning of the Ford brand in the GCC, while highlighting its heritage in the
region and the bond the brand had with the people of Arabia.

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Reliability and stability are the watchwords of the century-old automaker. With its emphasis on
the genuine nature of the brand and connection with the heritage of the region, the Drive
campaign played a vital role in strengthening Ford’s local presence.

Investing in Customer Satisfaction Ford Middle East and its network of dealer-partners are
constantly investing in delivering higher levels of customer satisfaction across the region. Since
2003 alone, Ford, Lincoln and Mercury importer-dealers have invested over USD100 million in
facilities and network expansion projects, especially in Saudi Arabia and the United Arab
Emirates.

Al Tayer Motors

Major dealer of Ford in the United Arab Emirates is Al Tayer Motors, delivering Ford vehicles to
the local consumers since 1982. Al Tayer Motors was established in 1982 and represents major
European and American automobile manufacturers such as Land Rover, Jaguar, Ford, Lincoln,
Mercury, Ferrari, Maserati and Spyker across the UAE. Al Tayer Motors' portfolio also includes
commercial vehicles - DAF trucks in the UAE.

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Literature Review

Previous research reports, conducted by university students, and internet periodicals, journals
and websites are referred in the report on Ford Motor Company’s organizational structuring
and designing implications. Reviewing the literature was of dominant importance, although
there have not been any specific research conducted on the relative topic for research. The
literature reviewed includes the internet, books, periodicals and researches contrasting the
organizational structure of Ford Motor Company. The following is given the list of referred
literature for the research:

1. Marketing research by the Troy University I2A group, based on the marketing plan
applied by the Ford Motor Company. Organizational Structure developed in the report
was referred.
2. Ford Motor Company website; http://www.ford.com
3. Al Tayer Motors website; http://www.altayermotors.com
4. Website referred to analyze the parent company website organizational chart;
http://www.cogmap.com/charts/ford-motor-company
5. Management by Mary Coulter and Robbins, Prentice Hall Publication 2002.
6. Organizational Theory, Design and Change, by Gareth Jones, 6th Edition.

Organizational structure and design in reference to Ford Motor Company, and its Dealer in the
United Arab Emirates, Al Tayer Motors, are focused in the report written. The literature
reviewed has exploited the knowledge base about the analysis of the organizational structures
and their implications in corporate governance of an organization. The literature facilitates the
understanding and explanation of the basic concepts, theories and principles associated with
the designing of an organizational structure and its implications for organizational
management.

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Methodology

The methods devised to collect and generate data for analysis are mentioned below:

Interview (Primary):

A primary source for the collection of data was mainly interview with Al Tayer Motor’s officials,
amongst which Melanie Davidson was assigned to be interviewed for the specific topic in
question, i.e. Organizational structure and design of Al Tayer Motors. The Questions designed
was short and of subjective nature, to fulfill the research requirements. The answers to the
questions were examined and scrutinized to develop the organizational design being followed
by Al Tayer Motors. The organizational chart was provided by Melanie Davidson for the
analysis of the design. The Organizational design consisted of 5 key elements analyzed;
Departmentalization, the chain of commands, the span of control, and decision making style
(centralization or decentralization), organizational design decisions (mechanistic or organic in
nature)

Internet (Secondary):

The Secondary source of information for the collection of data for the report was the Internet.
Several key areas of the organizational structure were explored to evaluate the design and the
hierarchical structure of Ford Motor Company and its United Arab Emirates dealer, Al Tayer
Motors, through the internet.

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Analysis and Results of data

Organizational Structure of Ford Motor’s Top Management


Executive Chairman

William Clay Ford

CEO

EXECUTIVE VICE PRESIDENT Alan Mulally

Ford of Europe & Premiere President, Chief Financial Officer President, Int’l Operations
Automotive Group
The Americas Mark Fields Don R. Leclair Mark A. Schulz
Chairman

Lewis Booth

GROUP VICE PRESIDENT

Chairman & CEO, Ford President & CEO. Ford N. American Mktng, Corporate Human Product Development,
Motor Credit Company of Europe John Sales & Service Resources the Americas,
Fleming Francisco Codina
Michael Bannister Joe W. Laymon Derrick Kuzak

Design & Chief Creative Corporate Affairs Asia Pacific and Africa Global Product Development &
Officer Chief Technical Officer,
Zaid Ojakli John Parker Richard Parry-Jones
J. Mays

SENIOR VICE PRESIDENT

Controller Chief Marketing Officer, Non General Counsel


executive Chairman, Volvo Cars,
Peter Daniel Hans-Olov Olsson David Leitch

Global Purchasing Customer Service


Division, Darryl B. Hazel
Thomas K. Brown

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Organizational Structure of Al Tayer Motors

Al Tayer Motors is the main dealer of the Ford Motor Company in the United Arab Emirates,
engaged in the import, sales and the customer service of Ford, Jaguar, Land Rover, Lincoln,
Mercury, Ferrari, Maserati and Spyker across the UAE. Al Tayer Motors' portfolio also includes
the sales of commercial vehicles – DAF.

Al Tayer Motors, with the increase of its operations and divisions, increase in the portfolios,
follow a more diverse organizational structure, the divisional structure. Al Tayer previously
followed a functional structure, with horizontal differentiation. Al Tayer was grouped into
functions to increase the effectiveness with which it achieved its goals. The development of
functions allowed it to manage an increase in specialization and the division of labor most
efficiently. But with the products and operations getting more complex, with the introduction of
Jaguar, Land rover, Mercury, etc. coordination, communication, measurement of performance,
and customer problems started to arise, and hence Al Tayer had to develop into a Divisional
structure.

Al Tayer Motor’s Divisional Structural Design

As shown in the Organizational Chart, Finance functions are separated, and created as a
separate division acting as a support function for all the divisions. Separate products, i.e.
different cars have different divisions in Al Tayer Motors. All the other functions impose sales
function on the division, as Al Tayer Motors is a dealership for the main manufacturing firm,
and hence focuses on import, sales, and customer service of the cars for Ford Motor Company.
Ford, Jaguar and Land Rover, Ferrari and Maserati, after sales, and Finance are the different
Divisions in Al Tayer Motors.

Product Structure is followed in Al Tayer Motors rather than a Product Divisional Structure or a
Multidivisional Structure. A product structure is a divisional structure in which products are
grouped into separate divisions to increase the control. Al Tayer Motors have centralized the
support function i.e. Finance, at the top of the organization so one set of support functions
services all the product divisions, as the products are similar and aimed at the same market.

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This design decision increases the horizontal differentiation within the organization, for each
division is headed by its General Manager and has its own hierarchy. The general manager of
each division adds a hierarchical level or authority increasing the vertical differentiation in the
organization. The General Manager coordinates with the Finance division to make effective use
of their skills and thus enhance sales of the company.

Chain of Command

The Chain of Command and the reporting relationships are clearly visible in the organizational
chart of Al Tayer Motors. The chain of command clearly shows that lines of control of the
company, which are effective considering the sales function of the organization. The Chain of
Command of each division lies in the product division. Employees assigned to Ford report to
their General Manager, and indirectly the CEO and Director can be reported also. Divisional
managers are responsible for the functioning and assignment of responsibilities, i.e. the
obligation to perform the duties, to the respective divisional employees.

Span of Control

The span of control determines the number of employees each manager can efficiently and
effectively manage. The span of control also determines the number of levels and managers in
an organization. The Span of Control in Al Tayer has been kept wide for a more efficient working
organization entailing more managerial levels. With respect to Ford, the GM is followed by
Brand Managers and Showroom Managers of Premier Motors directly. Brand Managers also
control the Sales Managers, who respectively control the Showroom managers. The skills and
abilities of the managers clearly influence the span of control in Al Tayer Motors. Al Tayer also
makes use of standardized procedures and information systems to better control the
organizational operations towards the organizational vision and mission.

Mechanistic vs. Organic Organizations

Al Taye motors have highly adaptive and flexible structure that permits organization to change
when the need arises. The product structure can diversify into product divisional structure with
increased complexity of the range of products. Al Tayer Motor’s employees are highly trained
and empowered to handle the top of the line range of cars of Ford as well as different other
automakers. Diverse job activities and tasks can be assigned to highly trained officials as per the
requirement arises. And there is minimal formal rules and little direct supervision in Al Tayer
Motors, hence making the organizational design a more Organic structure rather than the
Mechanistic structure, that employs vice versa features.

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Summary

Stakeholder goals and objectives can be achieved only when organizational skills and
capabilities are controlled through organizational structure. The activities of organizational
members would be chaotic without a structure that assigns people to roles and directs the
activities of people and functions. This report have examined how Ford Motor Company and its
Dealer, Al Tayer Motors has deigned its hierarchical control of authority. It has the following
main points:

1. Introduction to Organizational Structure and Design.


2. Introduction to Ford Motor Company and Al Tayer Motors, which is a UAE dealer for the
Ford Motors, including the Ford Vision and Mission and History of Ford’s entrance in the
UAE market.
3. Literature review, entailing the previous researches and the internet websites reviewed
for collection of data.
4. Methodology including primary (Interviews) and secondary (Internet) sources of data
collection.
5. Analysis of Data and Results obtained. Detailed Organizational Chart. Organizational
Design discussed with Organizational Chain of Command, Span of Control and
Mechanistic vs. Organic structure view.

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References

- Marketing research by the Troy University I2A group, based on the marketing plan
applied by the Ford Motor Company.
- Ford Motor Company website; http://www.ford.com
- Al Tayer Motors website; http://www.altayermotors.com
- Http://www.cogmap.com/charts/ford-motor-company
- Management by Mary Coulter and Robbins, Prentice Hall Publication 2002.
- Organizational Theory, Design and Change, by Gareth Jones, 6th Edition.
- Melanie Davidson , HR Operations Manager, Al Tayer Motors ,tel.: +971 4 3037201 fax:
+971 4 3037778 email: mbailey@altayer.com (Business Card attached)

THE END

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