Ford Motor Company can be discussed as one of the world’s most ethical companies with a long history. The leading company in the US automotive industry was founded by Henry Ford in Detroit, Michigan, in 1903 (Betton & Hench, 2002, p. 534). Ford Motor Company is not only a successful manufacturer but also a remarkable ethical actor in the industry because of following rather effective ethical standards and principles and because of treating consumers, the environment, and employees respectfully. The leaders of Ford Motor Company pay much attention to respecting the needs and interests of employees and customers and to preventing the ethical problems. It is important to conduct the analysis of the company’s ethical strategies and policies as well as the analysis of the effects and outcomes.
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Ford Motor Company’s Approaches to Treating Consumers, the Environment, and Employees
Ford Motor Company discusses ethical principles as the basis for treating consumers morally and responsibly. To support the idea that the interests of consumers are of the priority for the company, Ford utilizes a range of quality control measures and systems. The mission of the company is to produce high-quality cars and respond to the customers’ expectations (Ford: Sustainability Report Summary 2013/14, 2014). In the 1970s, the company faced an ethical case associated with mistakes in the Ford Pinto’s design. The company was blamed for producing cars which are of low quality because of the problems with Ford Pinto vehicles (Henn, 2009, p. 115-116). In reaction to the controversial situation, the company’s leaders admitted their guilt and focused on increasing the quality of the production process. The company chose to use the Six Sigma quality improvement strategy (Ford drives ahead with quality control, 2005, p. 18). Today, the main focus is on the constant control of the vehicles’ quality and the improvement of vehicle safety technologies.
The second important strategy followed in the company to address the customers’ needs is the company’s active involvement in the community’s life. Ford Motor Company pays much attention to supporting customers in their everyday life. The company supports the Ford Partnership for Advanced Studies as an academic program oriented to promoting higher education for the youth of the United States. The other social initiative is the Ford Driving Skills for Life program, which works to educate the youth about driving skills globally. One more initiative is the Ford Volunteer Corps, which works to support vulnerable categories of the population in the United States (Ford: Sustainability Report Summary 2013/14, 2014). The programs developed by Ford to support the community members are important to create the conditions to treat consumers morally and respectfully.
The needs of the environment are also discussed as the key perspectives for Ford Motor Company to promote sustainability. The first environment policy followed by the company is the focus on green manufacturing. Ford builds innovative plants in the United States, where environmentally friendly materials and the sources of green energy are used. Ford plants are equipped with the technologies which contribute to reducing the number of the used energy. The next approach is the focus on reducing gas emissions because of adapting the car engines to the use of green energy sources. The company began to use advanced engines, which can decrease CO2 emissions in more than 30% in 10 years (Ford: Sustainability Report Summary 2013/14, 2014). Thus, not only light materials are used to produce vehicles, but also innovative electric vehicles are designed to respond to environmental protection.
Ethical companies are also characterized by effective strategies in treating the employees to increase their competitive advantage and improve the workforce’s performance. The number of initiatives developed and implemented in the company to treat the employees respectfully is remarkable. The first group of initiatives is associated with following the company’s mission and focusing the attention on the teamwork and communication to motivate employees and promote growth. The other approach to motivate employees is the developed system of rewards and benefits for the workforce (Ford: Sustainability Report Summary 2013/14, 2014). The effective code of ethics is also used in the company, and employees have the opportunity to receive additional ethical training with the help of distant courses.
Ford Motor Company is interested in promoting diversity and inclusion policies to create teams where employees can demonstrate their skills and knowledge effectively. The main human resource management program followed in the company includes such spheres as the focus on strategic hiring, effective training and development programs for employees, efficient protection and safety standards, and the competitive healthcare services (Betton & Hench, 2002, p. 534). The reason for developing this HR management program is to address the employees’ interests most respectfully.
The Effects of Morally Conscious Decisions on Ford’s Bottom Line
Ford Motor Company differs from the other companies in the industry because of focusing not only on gaining profits but also on conducting the ethical business. As a result, morally conscious decisions made by the company’s leaders in the context of the ethical policies and initiatives affect the company’s development positively. The reason is in supporting the brand recognition and in the concentration on sustainability and employees’ interests (Ford drives ahead with quality control, 2005, p. 19). While promoting the practices associated with increasing the quality of products, Ford Motor Company wins the increased customer satisfaction and increases in sales.
Referring to the ethical decisions associated with the environmental issues, it is important to note that Ford managers and researchers are concentrated on using more advanced or innovative technologies in the production process in order to address the environmental concerns and to increase profitability as well as the competitive advantage (Ford: Sustainability Report Summary 2013/14, 2014). The focus on green manufacturing potentially leads to a significant reduction in costs and winning more positions in larger markets. One more advantage of using environmentally friendly technologies and green procedures is a significant contribution to the community’s needs as the main customers in the sphere.
The focus on corporate core values also has positive effects on Ford’s bottom line about treating the employees. The business success of the company significantly depends on the ethical strategies used by managers to organize and control the work of employees with the focus on gaining more profits. During the 1990s, the corporate culture of Ford Motor Company was not discussed by experts as ethical enough to respond to the needs of employees because the managers competed with each other without organizing the effective teams and without using any strategies to improve communication between the employees at all the stages of the production process. The situation was changed in the 2000s because of the necessity to build an effective culture based on the principles of support, safety, and diversity. As a result, the focus on ethical practices in management led to increasing the employees’ productivity in more than 25% (Ford: Sustainability Report Summary 2013/14, 2014). The needs of the employees became discussed equally to the interests of customers.
Areas Where Ford Can Improve Strategies
Even though today, Ford Motor Company is one of the leading ethical companies in the world, there are still areas where the company’s leaders can improve strategies and approaches to achieve higher results. The first area is the quality control sphere. In spite of the fact that the company uses the Six Sigma quality improvement strategy, more attention should be paid to the area because the standards of the products’ quality change and Ford has to cope with certain weaknesses in designing vehicles which were identified as a result of the Ford Pinto crisis (Ford drives ahead with quality control, 2005, p. 19). Today, the quality of vehicles is high, but the company’s engineers pay much attention to improving the technological process and produce exciting vehicles of high quality.
The second area where certain strategies can be improved is the human resource management and treatment of employees according to the principles of cooperation and teamwork. During a long period, Ford leaders promoted respect for individuality as the main HR strategy in the company. As a result, competition among managers increased, and the strategy led to significant increases in sales and revenues. However, in the 2000s, the strategy was discussed as ineffective because the constant competition among managers could not allow developing a single strategy for the company’s progress. From this perspective, contemporary strategies oriented to promoting the teamwork are not developed efficiently because of the drawbacks in their implementation (Betton & Hench, 2002, p. 535). That is why more attention should be paid to improving the teamwork among the employees in Ford Motor Company to create an exceptional competitive advantage.
Ford Motor Company is one of the prominent ethical leaders in the world. The success of the company’s approach to treating employees, consumers, and the environment is based on the mission followed by the leaders and on the orientation to creating the ethical workplace environment. Thus, to treat consumers, ethically means to work at improving the quality of vehicles to reduce the risks for consumers and promote safety principles. To treat the environment, respectfully means to focus more attention on green manufacturing and using renewable sources of energy. Finally, to treat employees morally means to create effective conditions for the work and increases in productivity. As a result, important initiatives to support the reward system and improve the training process are promoted in the company. All these strategies can be discussed as effective enough to create the ethical business, but more attention should be paid to the areas where the ethical principles are only at the first stage of implementation.
Betton, J., & Hench, T. (2002). Any color as long as it’s black: Henry Ford and the ethics of business. Journal of Genocide Research, 4(4), 533-541.
Ford drives ahead with quality control: Morals and ethics of delivering reliability. (2005). Strategic Direction, 21(10), 18-21.
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Ford: Sustainability Report Summary 2013/14. (2014). Web.
Henn, S. (2009). Business ethics: A case study approach. New York, NY: John Wiley & Sons.