Ford Motor Company (F) is in play. The hounds of M&A are after it. A couple of events (besides the dismal sales outlook):

Business Week ran a couple of articles, the first on the Ford family considering releasing some control (they have a special voting class of shares) and the stock price is up sharply (36% in the last month) pushed by a lot of accumulation pressure (F) .

Sales are dismal. Ford just announced temporarily shutting down several plants until inventories reduce (dealer lots are too full and channel stuffing works only so long) - expecting next quarter to produce nearly 25% fewer vehicles. They have been racking up huge losses and only hope to be profitable again a long way in the future.

There once was a rumor that Ford would have been acquired by Daimler had those family stock shares not existed. Daimler is now tied up, but there could be others interested - from the Nissan camp (though Nissan is less likely due to canceling
Volvo agreements) and some denials by Hyundai to buy Jaguar to Private Equity firms that would trim down the expenses and sell off some wonderful assets/brands and make the company strong again. Or so the press releases will say. A smaller Ford might be more profitable, but it would be smaller too expected job cuts may be accelerated . There is also trouble with credit rating cuts .

For investors, the stock is moving. With the buying pressure now evident it will be fickle and at any moment that surge could disappear. But there is buying pressure. Maybe it’s Kerkorian & crew working to stitch together a Frankenstein GM-F company? There would be rediculous numbers of redundant brands, platforms, and products. But it would be in play and pay some quick moving investors handsomely - provided they knew how to get out before the crash. And that will be the key - watch the stock closely and keep moving up your trailing stops.

The business cycle is in the investor’s favor now, and Ford Motor is serious about fixing their problems. The last half of the decade should see great improvement in vehicle sales along with profits just by being in the business. Ford is one of the grand cyclical stock plays - don’t miss out (but if you get in - watch your shares closely!).

Cheers!

[Usual disclaimer here about I do not directly own shares in Ford at this time and that you use this information for investing at your own risk]

Amazon.com apparently has begun collecting personal data on its customers. Nothing new. But seems there are a lot of people really worried. Here is a post I left on digg.com regarding this topic.

“Just don’t give out your information.

For those concerned about the database, remember that it’s a large corporation, with many, many inputs and differenet people typing in the information. Most of these databases get corupted data in them (ever typed your password in twice to change it? It’s because repeating and comparing the inputs is a good safety check against typos). The IRS has you self-report your taxes and then does spot-check audits.

A company can learn about zip codes, but they are not specific enough for effectuve merchandizing (any zip code can have houses ranging from $50k to $5M, the diverse incomes to support those house payments and fluctuating consumption as well depending on the owners’ perceived job security).

Can there be data to mine? Sure, but that assumes someone is really analyzing it. Supermarkets have tried “shoppers clubs” for years and they are no better off now than when they started. Many are abandoning these cards.

Or consider Automotive - the car companies track purchase patterns too - and what they always find is small cars (like the neons, PT cruisers, cobalts, civics, and corollas etc) always have a really high age group purchasing them (like averaging 54 years old). Then they run around trying to figure out how they missed their target consumers (was it the trim, the music package, were the advertisements in the wrong magazines or on the wrong tv shows, etc?) - the problem is their data. They have 54 year olds buying those cars for their sons’ & daughters’ first car. There are fewer 30 year olds buying cars for 16 year-ld kids than 54 year olds.

So your front-line defense is don’t share personal information (hard to resist those phishers too?). The second is to remember that data is corrupt. The third safety nets is inappropriate analysis.

Then worry less.

For the companies - stop over at www.privateproductivity.com/weblog for some help.”

Behind the Six Sigma quality movement is a reliance on actually analyzing data to get to the solution. And there are ways to better analyze data than are typically used, as well as improving the quality of the data existing and collected in the databases.

If you are a company looking to improve your data capture and analysis then please contact me. I am sure I can offer some quick and free advice or assist in really improving your systems.

Cheers!

Business Week ran an article titled “What Dell Should Do” to assist Dell in their falling stock price problem. I offered the following post on Business Week and have expanded on the “why” portion in this blog.

“Investors and traders should get ready to short Dell stock, because after seeing: “we expect to end the year with the widest product portfolio in our history, says Dell spokesman”, expect increasing trouble.

Dell is treading dangerous ground with expanding their offerings - companies increasing their complexity tend to lose focus and erode profits - that topples their stock price. It always begins by looking good. They expand their portfolio to capture marginal and fickle customers, overtax their quality control systems, and begin wavering on (or are overwhelmed by) customer service. After the stock price shock sets in (and with the usual management house cleaning) there is a consolidation wave to Value Engineer existing products and streamline the products and refocus marketing.

Get some help soon - before all those products launch.”

The “Why” portion:

There are a lot of whys, but the cleanest is some old (1970s and 1980s) studies by a couple of the larger branded consulting companies that looked at product breadth and company profitability. The data showed a sharp and linear decline in profitability with increasing products and brands that a company had.

Compare General Motors (eight brands) with Toyota (three brands). The television news program running as I write this said GM sales 2nd quarter 2006 fell 22% while Toyota increased 12%. Every day these two companies are nearing each other in annual sales.

Uncover the ramifications of complexity… A GM marketing budget needs to be almost three times larger to get the same mind-share (if not they are underspending on some or all of their brands). Likewise, an engineering design or manufacturing problem gets only a third of the management attention that such a problem might get at their competitor.

But one potential solution Dell should research: the platform engineering problems of GM in the 1980s. It was a naturally logical move then that became a liability. GM has only somewhat recently figured out what to do and has some great products launching now and in the coming months.

Often seeing and fixing the problem needs an outside opinion - too many inside the company are too vested in expanding their local efforts (products, brands, etc). A fresh set of eyes can aid the senior executives review, analyze, and decide these important issues. And there are a lot of details that need to be considered that cannot be covered even in a long weblog..

So send me an email if you think your company could use some help.

Cheers!