The Business Lessons US Automakers Can Offer Any Industry

The Business Lessons US Automakers Can Offer Any Industry

Options: Shoppers want them, and businesses inherently are always scrambling to try and provide them.

There are complicated reasons behind this scramble. From a business standpoint -- especially a manufacturing perspective -- it is a lot more streamlined and cost-effective to make a few things in larger quantities compared with many things at smaller quantities. Economies of scale, production equipment, research, design costs and marketing all play a role in making that business case.

With more than 25 years in the auto industry, I can definitely attest to the challenges and costs associated with providing lots of options when it comes to cars and premium upgrades. But are we effective in giving enough options to consumers today?

The fine line lies in providing the right mix of options to satisfy customers and maximize sales and reputation. At Ford, for example, we offer an entire green car line up -- from our electrification strategy of launching five new electrified vehicles to making sure each new product we introduce is among the best in class fuel economy.

We have taken the route of not betting on one "silver bullet" technology or green vehicle, but rather designing and delivering an entire portfolio of options for consumers. We are making an educated bet on the importance and demand for choice -- a concept and strategy that can and should extend to businesses well beyond the auto industry.

Businesses in every industry have long since realized that every customer's habits are different -- the same goes for driving habits and needs. Some use vehicles to drive long distances to work every day. Others only need a car for a handful of miles. According to a report covered by USA Today, 3.4 million Americans commuted 90 minutes or more to work each way. Those types of commuters would benefit from a small, efficient vehicle -- one that helps these "extreme commuters" not only save money on gas, but reduce their carbon footprint.

But commuters who only travel in the city would be ideal customers for driving a pure battery-powered vehicle: Since they only travel short distances to work, the grocery store and back, before arriving at their charge station, they can make the most use of EV technology.

Through April, industry sales of smaller, more fuel-efficient vehicles have increased from 19 percent of the car market to 25 percent. No doubt gas prices are having an impact on purchase decisions, but the increase in more fuel-efficient vehicle options across the market is also driving this change.

By increasing our small car product lineup and introducing innovative options like our EVs, Ford is starting to get ahead of this trend, and seeing an exciting return on investment.

The lessons we've learned through during the dark times in the last few years can be applied successfully to a number of businesses, especially as economic recovery continues to take shape. Business leaders today are starting to make bold moves with their R&D budgets that will shape their service or product portfolios months and years down the line. Companies that can find the balance of offering customers maximum choice within business objectives will be well situated to take advantage of their markets.