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How a global IT revamp is fueling Fords turnaround

Stephanie Overby | Sept. 1, 2010
If financial results are any indication, the One Ford strategy is moving the company in the right direction.

For example, in product development, IT is contributing directly to the top line. Smither's In-Vehicle Systems team is performing advanced proof-of-concept work with product-development engineers on the next generation of IT for Ford drivers.

The highest profile project to come out of this IT-business collaboration is Sync, Ford's award-winning in-car communications and entertainment system. Introduced in 2007, Sync enables drivers to control stereos, smartphones, seat controls and much more with a voice command-operated system. The company is now developing Sync application programming interfaces for Google Maps, Stitcher smart radio and the Twitter client OpenBeak.

After three years--and two million Sync systems--Ford says car buyers are more likely to purchase a Ford with Sync. And they have paid a $400 premium for it. In a 2010 Ford survey, 80 percent of potential customers said Sync improves their overall image of Ford, 70 percent said it makes them more likely to purchase a Ford, Lincoln or Mercury, and 88 percent would recommend others purchase a Sync-equipped vehicle. The technology has, "for the first time, created a new value proposition for an automotive company beyond the transportation benefit of an automobile," Koslowski says. "It's a competitive differentiator."

Back to the Future

If financial results are any indication, the One Ford strategy is moving the company in the right direction. Despite continued economic uncertainty, Ford predicts, and analysts agree, it will be solidly profitable in 2010--a year earlier than anticipated.

If all goes as planned, Ford will be able to build each of its cars for several thousand dollars less than its international competitors, says Cole, a reversal of fortune that will enable it to offer features and amenities others can't.

Ford needs all the profit margin it can get. The billions it borrowed in 2006 enabled it to avoid bankruptcy and a federal bailout, but it still has a mountain of debt to pay down.

Although Smither says Ford's IT department revamp is "well progressed," full global integration will take another two to three years. Beyond that, IT has truckloads to do. Global collaboration has, for one thing, doubled network traffic and strained Ford's consolidated infrastructure. "We need to make big investments in ensuring our network is resilient and improve capabilities in our hosting environment," says Smither. Savings from data center consolidation must be reinvested in infrastructure improvements, like re-architecting Ford's WAN. New consumer technologies will demand more from IT as well. "In terms of areas where technology is rapidly advancing--mobility, social networking internally and externally--we're just in the infancy of that," says Smither.

Accordingly, IT will need professionals with emerging technology experience--a skill set in high demand. Cole says employers are already experiencing shortages of workers with critical skills, and if Ford waits too long to staff up, it could have a hard time finding professionals with the right knowledge. Ford's Nissen says IT staffing is under constant evaluation, and that Ford has deals with third-party IT service providers capable of staffing up when necessary.

 

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