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Published by: IBS Center for Management Research
Published in: 2021
Length: 6 pages
Data source: Published sources

Abstract

The period between 1980-1982 saw a recession in the USA which also caused trouble to the American automobile industry. Ford, Motor Company an American automobile corporation was affected as well by the slowdown. The situation triggered a search by Ford executives for ways to reduce overhead and administrative costs. The executives at Ford realized that they had a large headcount in their accounts payable department and the procure to pay process for purchase orders was also very error prone. To make the department lean and process more accurate, the company decided to bring about a radical change in the process by re-engineering the entire system. Ford introduced invoiceless processing in procure to pay process which was simple and also reduced discrepancy errors in invoice clearance. Through the new system Ford was able to reduce the headcount by 75% and also improve vendor relations.

Teaching and learning

This item is suitable for postgraduate courses.

Time period

The events covered by this case took place in 1980-1982.

Geographical setting

Region:
Americas
Country:
United States
Location:
Michigan

Featured company

Ford Motor Company
Employees:
10000+
Turnover:
USD 155.9 billion (2019)
Type:
Public company
Industry:
Automotive

About

Abstract

The period between 1980-1982 saw a recession in the USA which also caused trouble to the American automobile industry. Ford, Motor Company an American automobile corporation was affected as well by the slowdown. The situation triggered a search by Ford executives for ways to reduce overhead and administrative costs. The executives at Ford realized that they had a large headcount in their accounts payable department and the procure to pay process for purchase orders was also very error prone. To make the department lean and process more accurate, the company decided to bring about a radical change in the process by re-engineering the entire system. Ford introduced invoiceless processing in procure to pay process which was simple and also reduced discrepancy errors in invoice clearance. Through the new system Ford was able to reduce the headcount by 75% and also improve vendor relations.

Teaching and learning

This item is suitable for postgraduate courses.

Settings

Time period

The events covered by this case took place in 1980-1982.

Geographical setting

Region:
Americas
Country:
United States
Location:
Michigan

Featured company

Ford Motor Company
Employees:
10000+
Turnover:
USD 155.9 billion (2019)
Type:
Public company
Industry:
Automotive

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