The two automakers’ contrasting product development and marketing programs in the 1990s illustrate the traditionally viewed tradeoffs of efficiency and effectiveness, global stan- dardization versus customization, market segmentation versus product differentiation, and product orientation versus cus- tomer orientation. These debates are framed by the tension between bending demand to the will of supply (i.e., driving the market) versus adjusting to market demand (i.e., driven by the market).
It is difficult to conclude that one strategy is always better than the other. One has to be reminded that while the Ford Mondeo/Contour project cost $6 billion and took six years to develop, potential cost savings from the global strategy could also be enormous for years to come. On the other hand, GM’s regional strategy could also make sense if regional taste differences remain so large that a Ford-style global strategy could, indeed, end up producing a ‘‘blandmobile’’ that hits the lowest common denominator of taste in different markets.
Which was a winning strategy in the 1990s? Ford’s ex- president, Jacques Nasser, wanted to keep the efficiencies generated from central thinking about design and production. But he wanted to reintroduce the market focus in regions across the globe that will give Ford stronger brands and more appealing products. The Ford 2000 was a good idea carried a bit too far. Ford Contour was discontinued from the U.S. market in 2001. Ford is now trying to redefine the Ford 2000 program with a heightened emphasis on the company’s brands and to give the various regional and brand units more autonomy.