A Company Analysis on General Motors - Case Study Example

? Business Report: A Company Analysis on General Motors Business Report: A Company Analysis on General Motors Executive Summary General Motors has been analyzed based on its background description, international strategy, marketing approach, logistics approach, and human resource management approach. Each of the approaches has shown significant weaknesses on the side of the aforementioned company, especially when it comes to its financial standing. As the company loses much money, it may not be able to train the semiskilled and unskilled people of the developing nation. Probably, the company will not be able to contribute to the development of the country if ever it is permitted to operate. Company Description General Motors is considered to be one of the largest vehicle manufacturers in the world. It started its operation in 1908 and expanded to 190 countries by today. GM had about 647,000 employees that worked to create more than $168 billion in revenue for the company back in 1996. Its main office is found in Detroit, Michigan, where the board of directors has their regular meetings regarding the direction and performance of GM as a whole. The company consists of “General Motors North American Operations, Delphi Automotive Systems, General Motors International Operations, General Motors Acceptance Corporation, Hughes Electronics Corporation, General Motors Locomotive Group and Allison Transmission,”i International Strategy of the Company In the late 90s, General Motors had lost much money based on its sales in the USA. In contrast, it experienced a huge growth on its overseas operations, which means the strategy of GM must be focused on a global scale. The leaders of GM even claimed that the target of the company is not only to go global but also to be the world’s first leading vehicle manufacturer.ii In line with its endeavor to continue growing on a global scale, General Motors reshapes its international strategy. It focused its efforts on making and selling two brands only: Chevrolet and Cadillac. They will have the chance to surpass Toyota and may become global brand leaders, as the Chief Executive Officer Dan Akerson claimed.iii It may help the company, since the employees and the management can work on fewer brands and improve them further to get larger market share globally. As a proof of its global strategy, GM was able to increase its efficiency by making its branches around the world follow certain basic rules in making the vehicles. With just few changes and assemblies, those products may be sold anywhere. In particular, specializations had been given to various branches of GM worldwide. Korean branch focused on making handles and small car parts, while European units make average-sized cars. The USA division produces sports vehicles and the Australian one produces rear-wheel cars.iv Marketing Approach of the Company General Motors has recently changed its marketing approach, since it faced bankruptcies and lower sales in general despite of the beautiful look of its cars. It also created a standard in vehicles in terms of power, durable engines, and absence of shiny accessories. Majority of vehicle commercials focused on gas efficiency and the comfort the vehicles bring to their users matched with the famous celebrities endorsing the products. GM has taken advantage of its pioneering credibility to project the image as the original USA vehicle producer. Despite of the stereotypes of their commercials project, GM was not able to take note of the American customers and their behaviors in buying cars, which revolved around the performance and reliability.v To increase its sales, General Motors decided to resort to the digital marketing, which becomes a trend of advertising. It tends to consider everything when dealing with clients and continuously maintaining loyal customers. GM considers the budget, location, travel time, and behavior of the potential customers. Through those considerations, they can map the responses and support that they can give for a continued patronage of the customers. GM also took note of social media like Facebook and Twitter as effective avenues for advertising that deal with the funnel system in building the list of prospects. In addition, the company tries attracting the customers with the help of their passions. For example, music has been considered to be a part of the lives of many people, and that is why Chevrolet has been out in the market with advanced music functionality, such as the ability to use Spotify. With those in mind, GM can influence their customers to become GM advocates to further increase the popularity of GM that may lead to increase in sales revenue.vi The use of the internet must also be intertwined with market focus to ensure the success of having increased sales. The management of GM must be able to make some plans and systems wherein the workers and the funds are concentrated in making revenues for the company on a long-term basis. The managers must know where and when to quit if ever they cannot create any positive cash flow from certain market segments. Sadly, GM was not able to have the focus and positive cash flow, even though it has a complicated corporate portfolio like other companies. It has about 95 cars to offer, which becomes a big problem, since it is difficult to manage a wide variety of products to penetrate the market and get adequate sales. Billions of dollars have been lost by GM due to its lack of focus. In addition, it was not able to get positive net cash flow and significant market share.vii Logistics Approach of the Company General Motors has been known to produce large volumes of cars, although the quality of the vehicles may be sacrificed due to the obsession in bulk production. In addition, GM has hired workers with high wages that pushed the condition of the company to its unsustainable form. Both pension and healthcare were required to be given to its employees, and this endangered the financial condition of the company.viii GM also does some outsourcing to other companies such as Electronic Data Systems to save money, since they will not need to provide benefits and high compensation if they hire not their own workers. In addition, outsourcing allows GM to gain access to talented individuals to work on their own account for less cost.ix Human Resource Management Approach of the Company The massive financial loss in the 1990s might have brought massive lay-offs to General Motors in order to save the company from closing. In that way, it might still operate, but it may have lost significant pool of talented workers. Those workers may have the capacity to boost the overall performance of GM, which may not happen, since they were laid-off. The solution is to get the technology from, for example, a competing company to boost the knowledge and skills of its employees. The key to success is to motivate the workers, develop them, and increase their satisfaction. They may need to have good work layout, less lay-off, less retrenchment of employees, and updated technology.x Summary General Motors has been known as one of the leading vehicle manufacturers in the globe and has been present on the market for about a century. In the recent decades, the company experienced huge financial loses due to its mismanagement. It has been involved in the mass production of the low-quality cars. Despite of its losses, it was able to gain international earnings which were higher than domestic revenue. Probably, the changes within it may have a chance to bring back the former glory of the company, but its bankruptcy may give a bad impression to the public. Conclusion As an analyst for the Minister of Industry, the author may disapprove the petition of General Motors to enter the country and do its business there because of the negative background of GM, especially regarding its finances. A company facing its bankruptcy, though it filed a bankruptcy protection, may not help a nation with unskilled and semi-skilled workers, because their needs may not be sufficiently provided for. GM may not have enough capabilities to assist in the development of the nation. Read More