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Ford Motor Company: Accounting for Deferred Taxes SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

Case Study SWOT Analysis Solution

Case Study Description of Ford Motor Company: Accounting for Deferred Taxes


Ford Motor Company (Ford) is considering whether to reverse the valuation allowance it has recorded over its deferred tax assets. Due to substantial losses from 2006 to 2008, Ford has $10.3 billion of tax loss carryforwards in addition to other deferred tax assets; however, due to uncertainty, Ford has not recorded the value of those deferred tax assets on its balance sheet. In light of improving business conditions over 2009 and 2010, Ford must now decide whether it is "more likely than not" to realize the value of its deferred tax assets and reverse the $15.7 billion valuation allowance it has recorded. If reversed, Ford must also decide how to present the change in valuation in its financial statements.

Authors :: Darren Henderson, Christine Liu

Topics :: Finance & Accounting

Tags :: Communication, Financial analysis, SWOT Analysis, SWOT Matrix, TOWS, Weighted SWOT Analysis

Swot Analysis of "Ford Motor Company: Accounting for Deferred Taxes" written by Darren Henderson, Christine Liu includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Ford Deferred facing as an external strategic factors. Some of the topics covered in Ford Motor Company: Accounting for Deferred Taxes case study are - Strategic Management Strategies, Communication, Financial analysis and Finance & Accounting.


Some of the macro environment factors that can be used to understand the Ford Motor Company: Accounting for Deferred Taxes casestudy better are - – increasing commodity prices, increasing government debt because of Covid-19 spendings, technology disruption, there is backlash against globalization, customer relationship management is fast transforming because of increasing concerns over data privacy, there is increasing trade war between United States & China, geopolitical disruptions, cloud computing is disrupting traditional business models, competitive advantages are harder to sustain because of technology dispersion, etc



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Introduction to SWOT Analysis of Ford Motor Company: Accounting for Deferred Taxes


SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Ford Motor Company: Accounting for Deferred Taxes case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Ford Deferred, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Ford Deferred operates in.

According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.




SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix


SWOT analysis of Ford Motor Company: Accounting for Deferred Taxes can be done for the following purposes –
1. Strategic planning using facts provided in Ford Motor Company: Accounting for Deferred Taxes case study
2. Improving business portfolio management of Ford Deferred
3. Assessing feasibility of the new initiative in Finance & Accounting field.
4. Making a Finance & Accounting topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Ford Deferred




Strengths Ford Motor Company: Accounting for Deferred Taxes | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Ford Deferred in Ford Motor Company: Accounting for Deferred Taxes Harvard Business Review case study are -

Highly skilled collaborators

– Ford Deferred has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Ford Motor Company: Accounting for Deferred Taxes HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.

Strong track record of project management

– Ford Deferred is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

Operational resilience

– The operational resilience strategy in the Ford Motor Company: Accounting for Deferred Taxes Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.

Successful track record of launching new products

– Ford Deferred has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Ford Deferred has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.

Learning organization

- Ford Deferred is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Ford Deferred is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Ford Motor Company: Accounting for Deferred Taxes Harvard Business Review case study emphasize – knowledge, initiative, and innovation.

Innovation driven organization

– Ford Deferred is one of the most innovative firm in sector. Manager in Ford Motor Company: Accounting for Deferred Taxes Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.

Analytics focus

– Ford Deferred is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Darren Henderson, Christine Liu can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.

Superior customer experience

– The customer experience strategy of Ford Deferred in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

Sustainable margins compare to other players in Finance & Accounting industry

– Ford Motor Company: Accounting for Deferred Taxes firm has clearly differentiated products in the market place. This has enabled Ford Deferred to fetch slight price premium compare to the competitors in the Finance & Accounting industry. The sustainable margins have also helped Ford Deferred to invest into research and development (R&D) and innovation.

Cross disciplinary teams

– Horizontal connected teams at the Ford Deferred are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.

Organizational Resilience of Ford Deferred

– The covid-19 pandemic has put organizational resilience at the centre of everthing that Ford Deferred does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.

Diverse revenue streams

– Ford Deferred is present in almost all the verticals within the industry. This has provided firm in Ford Motor Company: Accounting for Deferred Taxes case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.






Weaknesses Ford Motor Company: Accounting for Deferred Taxes | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Ford Motor Company: Accounting for Deferred Taxes are -

Interest costs

– Compare to the competition, Ford Deferred has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.

Skills based hiring

– The stress on hiring functional specialists at Ford Deferred has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.

Aligning sales with marketing

– It come across in the case study Ford Motor Company: Accounting for Deferred Taxes that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Ford Motor Company: Accounting for Deferred Taxes can leverage the sales team experience to cultivate customer relationships as Ford Deferred is planning to shift buying processes online.

Employees’ incomplete understanding of strategy

– From the instances in the HBR case study Ford Motor Company: Accounting for Deferred Taxes, it seems that the employees of Ford Deferred don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.

Lack of clear differentiation of Ford Deferred products

– To increase the profitability and margins on the products, Ford Deferred needs to provide more differentiated products than what it is currently offering in the marketplace.

Low market penetration in new markets

– Outside its home market of Ford Deferred, firm in the HBR case study Ford Motor Company: Accounting for Deferred Taxes needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.

High dependence on star products

– The top 2 products and services of the firm as mentioned in the Ford Motor Company: Accounting for Deferred Taxes HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Ford Deferred has relatively successful track record of launching new products.

Ability to respond to the competition

– As the decision making is very deliberative, highlighted in the case study Ford Motor Company: Accounting for Deferred Taxes, in the dynamic environment Ford Deferred has struggled to respond to the nimble upstart competition. Ford Deferred has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.

Slow to harness new channels of communication

– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Ford Deferred is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Ford Motor Company: Accounting for Deferred Taxes can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.

Slow decision making process

– As mentioned earlier in the report, Ford Deferred has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Ford Deferred even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.

Need for greater diversity

– Ford Deferred has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.




Opportunities Ford Motor Company: Accounting for Deferred Taxes | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis


The opportunities highlighted in the Harvard Business Review case study Ford Motor Company: Accounting for Deferred Taxes are -

Reforming the budgeting process

- By establishing new metrics that will be used to evaluate both existing and potential projects Ford Deferred can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.

Using analytics as competitive advantage

– Ford Deferred has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Ford Motor Company: Accounting for Deferred Taxes - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Ford Deferred to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.

Building a culture of innovation

– managers at Ford Deferred can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Finance & Accounting segment.

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, Ford Deferred can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Ford Motor Company: Accounting for Deferred Taxes, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.

Low interest rates

– Even though inflation is raising its head in most developed economies, Ford Deferred can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.

Manufacturing automation

– Ford Deferred can use the latest technology developments to improve its manufacturing and designing process in Finance & Accounting segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.

Lowering marketing communication costs

– 5G expansion will open new opportunities for Ford Deferred in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Finance & Accounting segment, and it will provide faster access to the consumers.

Creating value in data economy

– The success of analytics program of Ford Deferred has opened avenues for new revenue streams for the organization in the industry. This can help Ford Deferred to build a more holistic ecosystem as suggested in the Ford Motor Company: Accounting for Deferred Taxes case study. Ford Deferred can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.

Developing new processes and practices

– Ford Deferred can develop new processes and procedures in Finance & Accounting industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.

Better consumer reach

– The expansion of the 5G network will help Ford Deferred to increase its market reach. Ford Deferred will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Ford Deferred can use these opportunities to build new business models that can help the communities that Ford Deferred operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.

Redefining models of collaboration and team work

– As explained in the weaknesses section, Ford Deferred is facing challenges because of the dominance of functional experts in the organization. Ford Motor Company: Accounting for Deferred Taxes case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.

Identify volunteer opportunities

– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Ford Deferred can explore opportunities that can attract volunteers and are consistent with its mission and vision.




Threats Ford Motor Company: Accounting for Deferred Taxes External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis


The threats mentioned in the HBR case study Ford Motor Company: Accounting for Deferred Taxes are -

Regulatory challenges

– Ford Deferred needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Finance & Accounting industry regulations.

Consumer confidence and its impact on Ford Deferred demand

– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.

Barriers of entry lowering

– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Ford Deferred with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.

High dependence on third party suppliers

– Ford Deferred high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.

Stagnating economy with rate increase

– Ford Deferred can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.

New competition

– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Ford Deferred in the Finance & Accounting sector and impact the bottomline of the organization.

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, Ford Deferred can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Ford Motor Company: Accounting for Deferred Taxes .

High level of anxiety and lack of motivation

– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Ford Deferred needs to understand the core reasons impacting the Finance & Accounting industry. This will help it in building a better workplace.

Technology acceleration in Forth Industrial Revolution

– Ford Deferred has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Ford Deferred needs to keep up with the evolution of technology in the Finance & Accounting sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.

Instability in the European markets

– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Ford Deferred will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.

Increasing wage structure of Ford Deferred

– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Ford Deferred.

Backlash against dominant players

– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Ford Deferred business can come under increasing regulations regarding data privacy, data security, etc.

Shortening product life cycle

– it is one of the major threat that Ford Deferred is facing in Finance & Accounting sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.




Weighted SWOT Analysis of Ford Motor Company: Accounting for Deferred Taxes Template, Example


Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Ford Motor Company: Accounting for Deferred Taxes needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants. We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –

First stage for doing weighted SWOT analysis of the case study Ford Motor Company: Accounting for Deferred Taxes is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.

Second stage for conducting weighted SWOT analysis of the Harvard case study Ford Motor Company: Accounting for Deferred Taxes is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.

Third stage of constructing weighted SWOT analysis of Ford Motor Company: Accounting for Deferred Taxes is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Ford Deferred needs to make to build a sustainable competitive advantage.



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