What is Ford companys alignment and bargaining power of buyers Essay

What is Ford companys alignment and bargaining power of buyers - Essay Example What is Ford company’s alignment and bargaining power of buyers? The bargaining power of buyers’ for Ford can be examined as relatively low or moderate. Conceptually, the bargaining power of buyers is presumed to depend on various industrial factors ranging from the availability of substitute products to the pricing strategies undertaken by the company or the consumer purchasing power affecting the demand for the product/service on offer. As explained in Porter, the aggregate volume of buyers availed by the company also determines the degree of their bargaining power, apart from the facts that the products are undifferentiated in the market, a low switching cost prevails in the market With the aim to verify the same code of conduct in order to maintain better working conditions and protect the employees’ human rights throughout the chain, Ford provides training as required by the suppliers and inquires them to provide internal training to safeguard understanding of the codes. Ford also assists in developing the process of compliance to support the codes in its supply chain sustainability management as its â€Å"macro-management† strategy. The business framework also intends to inspire suppliers to accept and impose identical code of performance within Ford in the â€Å"encouraging† phase. To manage the performance in this phase, each supplier has been assigned with an executive to lead the expansion of the code and enable them to report the growth to Ford in response to the traditional metrics. During the stages of progression of the suppliers, the company also delivers considerable support, contacts and resources in order to assist the suppli er to improve its program. This commitment further proves to be highly significant for both the business and its stakeholders in reducing the operational risks, which could hamper the production to a substantial extent. Apparently, the alignment certifies accountable behavior throughout the ‘Automotive Supply Chain’ establishing interlinked and interdependent sustainability goals, through the three phase expansion process of â€Å"macro-managing†, â€Å"encouraging† and â€Å"expecting† (Business for Social Responsibility, â€Å"Internal Alignment: An Essential Step to Establishing Sustainable Supply Chains†). The final phase of â€Å"expecting† focuses to share the same sustainability goals to have greater expectancy throughout the supply chain. The company has therefore been applying a vigorous procedure to ensure the effectiveness of these stages. Through this procedure of Aligned business framework, almost 24% of Ford’s supp liers have been successful to meet the benchmark performances, which are to maintain the codes of conduct and the standard internationally throughout its supply chain. It is worth mentioning in this context that with the implementation of Aligned Business Framework business model, Ford has been able to increase its cost-effectiveness, simultaneously raising the quality features of its suppliers. The alignment also increases the innovation and reduces operational risks by way of improving the working conditions to a profitable extent (Corporate Ford, Creating a Sustainable Supply Chain: Strong Relationships, Shared Commitment, and Capacity Building†). Thus, it shall be rationally affirmed that the implementation of the aligned business model framework in Ford, aided it along with its suppliers to gain higher degree of sustainability and operational efficiency, not only in terms of costs and profitability but also in the form of legal coordination with the business partners thro ughout. WHAT IS FORD COMPANY’S BARGAINING POWER OF BUYERS? The bargaining power of buyers’