General Motors (GM) Is One

General Motors (GM) is one of the largest automobile companies in the world. Over the years GM has been able to carve out a corporate identity, to become one of the most recognizable brands in America. Over time the company was able to develop several popular brands that have come to be symbolic with the image of the American landscape including Chevrolet and Cadillac (Sloan et al., 1990). GM is currently confronting some of the most difficult obstacles that it has ever had to overcome. Government intervention is no guarantee that the company will be able to overcome these obstacles. From an internal standpoint, the company must be willing to abandon some of its old ideals. If this means that some of the top executive have to go than so be it. The restructuring the company will take a great deal of patience an the company must be prepared to handle the changes that will happen within the company as a result. If the company is welling to make the recommended changes it may have a chance to recovery and become a viable company again. The company has survived hard times before but it was able to overcome. General Motors is an American Icon that has changed the way America and the world moves.

Contents

Chapter I Introduction

Chapter II Literature Review

Company History

Current Woes

Chapter III Strategic Plan

Company Background

Analysis and methodology

Mission and Vision Statements

Quality and management initiatives

Organizational behavior

Leadership and Management

Organizational Structure

Grouping and Teamwork

Organizational culture

Information Systems

HRM issues

Resourcing and legal issues

Skills,

Training and development

Coaching and mentoring

Performance and Motivation

SWOT Analysis

Strengths

Weaknesses

Opportunities

Threats

Future directions

Change management plan;

Organizational Development

Success Factors

Recommendations

Chapter I Introduction

General Motors (GM) is one of the largest automobile companies in the world. The company has been a powerful force in the global automobile industry. The company has been an industry leader in several spheres of automobile manufacture including safety and automated assembly of automobiles. The company has experienced a great deal of success and profitability in the 100 years since its inception. However, in recent years the company has experienced a decline in profits and the intense scrutiny of the company's management decisions. The purpose of this report is t develop a strategic plan for GM that will assist the company in improving its condition over the next five years.

Aim

The aim of this report is to provide a clear and succinct plan of action for general motors as it attempts to recover from the current crisis it is confronting. The report will provide a detailed plan for change management which will enable to company to move forward in a manner that is informed by the vision and mission of the company.

Method

As a means of carrying out the aforementioned aim the research method will involve the utilization of academic and business databases as it pertains to articles about General Motors. The research will also contain excerpts from books about the American automotive industry.

Outcome

The outcome of the research will be the development of a strategic plan that is consistent with the mission and vision statements of General Motors. Overall the strategic plan will prove instrumental in reshaping the manner in which the company moves forward.

Chapter II Literature Review

Introduction

General motors is a company with a long history. It began in the same way that many American business began with a small group of employees and a significant vision. The following literature review will explain the history of the company, some of the troubles that the company experienced early on and the current situation of the company. The literature review will provide considerable insight into GM's origins and its lasting status as an American Icon.

Company History

General Motors was founded during the first decade of the 20th century. By the 1920's the company had grown substantially in size and was on the brink of becoming immensely successful. However the company was also facing a financial crisis and this crisis cause the du Pont family to intervene in an effort to protect their interest in the company. The intervention also meant the restructuring of GM's management. The restructuring of the management was needed primarily because very few people know who GM was. According to an article entitled "The Corporation Nobody Knew"

"If General Motors lacked a public presence in 1922, it suffered an even greater defect in the eyes of its leaders. It lacked adequate internal coordination and integration. Since its origins in 1908, GM had existed primarily as a holding company composed of highly decentralized individual manufacturers (Marchand,

1991)."

Although many people were unaware of the GM the parent company, people were aware of the brands sold by the company such as Cadillac, Chevrolet and Buick. However the company had not yet established itself via the General Motors brand.

Over the years GM has been able to carve out a corporate identity, to become one of the most recognizable brands in America. The investment made in the company by the DuPont's helped to propel GM into its status as one of the largest companies in the world.. Over time the company was able to develop several popular brands that have come to be symbolic with the image of the American landscape including Chevrolet and Cadillac (Sloan et al., 1990).

Current Woes

In recent months General Motors has experienced a great deal of turmoil as a result of slumping sales and inadequate management. The problems facing GM have caused the federal government to intervene and has appointed a taskforce to oversee the restructuring of the company. According to Welch (2009) "The latest GM plan unveiled on Apr. 21 will slash more jobs and dealerships, shut down the Pontiac brand, and swap up to $27 billion in unsecured debt from bondholders for equity has heavy government input (Welch)." In addition the treasury has employed the Boston Consulting group to examine GM's operations. Additionally, the leaders of the task force Steven Rattner and Ron Bloom speak with the CEO of GM on a consistent basis to determine what the best financial decisions can be made for the company.

The involvement of the government in GM's affairs occurred because the company has borrowed over $15 billion from the federal government. The article reports hat without pressure from the federal government GM would not have restructured and the company could be in even more trouble than it already is. The article explains that

"GM is about to embark on a crash diet that will leave it a much diminished though more focused company, whose dominant shareholders could ultimately be the government (50%) and the United Auto Workers (39%) (Welch)."

Stoll & Turlep (2009) that under General Motors restructuring plan GM is requesting an additional $11.6 billion in loans from the Treasury Department. This is addition to the $15.4 billion the company has already borrowed from the federal government. In order to pay of this loan, GM will "use stock instead of cash to pay off half the $20.4 billion it owes a United Auto Workers fund to cover retiree health care. That stock would leave the union owning about 39% of GM. The upshot would be the transformation of a troubled American icon, leaving it in the hands of the government and its main union. The situation, fraught with complications and potential conflicts, comes on top of the U.S. government taking stakes in banks and insurer American International Group Inc. (Stoll & Turlep)."

An article entitled "GM's Future" seems to echo this sentiment. The article explains that the future of General Motors is obvious. Whether or not the company files for bankruptcy is irrelevant. The article asserts that GM will continue to struggle. In addition, the company will not quickly return to its former status as one of the great automobile companies.

The author explains that the federal government will continue to support the company over the next three years. The author also asserts that the decisions related to GM will be political because "Five Midwestern states will be decisive in the next presidential election, and they might be hard to carry if the party in power doesn't save some Rust Belt jobs. But after the next election GM will be largely on its own (Flint, 38)."

Although many of the cars produced by GM are improving, it doesn't matter because changes to the product line have come too late. The author insist

"The problems are just too great for this management -- and, to be fair, maybe any management -- to overcome. There are many: buyers' fears about the company's future; the lack of dealer credit; the weakness of finance arm GMAC, which was severely damaged by subprime mortgages; the bondholder debt; the rush of new vehicles by richer foreign companies from Japan, Germany and Korea; and the collapse of the overseas empire in Europe. Management stumbles from crisis to crisis, bowing to whatever thought comes from Washington, whether sensible or foolish (Flint, 38)."

Conclusion

Overall GM is currently confronting some of the most difficult obstacles that it has ever had to overcome. Government intervention is no guarantee that the company will be able to overcome these obstacles. Billions of dollars have been given to the company in an effort to save it from further demise. However, capital alone will not save the company, there must be a strategic effort of the management to properly restructure the company to ensure that GM can recover. Such a recover is going to require a very specific Strategic Plan. Such a plan will be detailed thoroughly in the remainder of this report.

Chapter III Strategic Plan

Strategic Plan

Although there is a great deal of negativity surrounding GM and the ability of the company to recover from its current situation, with the proper strategic plan the company can improve its situation. However, to develop an effective strategic plan the company must evaluate its situation and develop a plan that will properly address the situation.

Company Background

GM has existed for just over 100 years. The company, founded in 1908, operates in 34 countries and employs more than 244,000 people. GM manufactures automobiles (trucks and cars). GM's automobiles are sold in 140 countries throughout the world. The company manufactures automobiles under the following brand names: Saab, Buick, Holden, Chevrolet, GM Daewoo, HUMMER, Cadillac, Opel, Pontiac, Saturn, Vauxhall, Wuling and GMC. In the year 2008 the company sold more than 8 million vehicles. America is the largest market for GM. GM also has a significant share of the market in countries such as the United Kingdom, China, Russia, Germany and Canada. In addition, OnStar a GM company, is the leader in the industry as it pertains to security and vehicle safety (Company Profile).

Supporting case studies

GM is not the only automotive company that has experienced times of turmoil or overcome huge obstacles. One such company was Ford. Ford was faced with the challenge of creating a vehicle that would be affordable to a large number of people. This is the same challenge that GM is facing as it attempts to create hybrid./alternative fuel vehicle that is affordable to the masses.

In the case of Ford, Henry Ford wanted to manufacture

"a motor car for the great multitude." He wanted to build a high-quality automobile that would be affordable to everyday people. He believed the way to do this was to manufacture one model in huge quantities. "Ford and his company s engineers designed a car named the Model T. First offered for sale in 1908, the Model T. was produced like other cars -- one vehicle at a time. But the Model T

was more sturdy and powerful than other cars. Considered relatively simple to operate and maintain, the auto offered no factory options, not even a choice of color. The Model T. was also less expensive than most other cars. At an initial

price of $950, 10,000 autos were sold the first year -- more than any other model

("Henry Ford and the Model T")."

So how did Ford accomplish this? Henry Ford and those working with him developed an innovative way of manufacturing cars, known as mass production. Ford's feet was only accomplished because the company dared to be innovative and create a totally new way to manufacturing. This type of innovation is also essential for GM to adapt of it is to recover from its current dire situation.

Analysis and Methodology

For the purposes of this strategic plan the Situation, Target, Path (STP) methodology will be utilized. The first step in this methodology is to evaluate the current situation so that the problems can be properly analyzed and confronted. The second step is to specifically target weakness in the company so that they are handled in an effective way. The third step in this methodology is to develop a path for the future of the company (What is the STP).

Vision and Mission

Vision statement: to be the leading company in automobile manufacture/sells and related services (Vision & Strategy).

Mission statement: The company will continue to the be the global manufacturer of innovative environmentally friendly vehicles.

Quality and Management initiatives

General Motors is committed to the manufacture of quality automobiles. The company's utmost concern in terms of quality is the safety of its products. GM wants drivers and their passengers to be safe when they travel in a GM vehicle. To this end the company has always had a high standard for safety. In fact GM developed a retrofit trunk anti-entrapment system before any other company in the industry. GM was also the first car company to announce the development of an infrared trunk sensor that can detect the presence of human beings and will provoke the horn to sound and the trunk will open automatically (Vision & Strategy).

Also as it pertains to quality management the company has attempted to reduce vehicle emissions. In fact GM was the first automobile company in the Chinas market to put catalytic converters of all automobile manufactured in China (Vision & Strategy). All vehicle manufactured at GM's Shanghai facility contains a catalytic converter that only functions on unleaded fuel (Vision & Strategy).

As it pertains specifically to the company's plants GM is committed to the conservation of resources. In fact GM has established a "non-product output goals, i.e., reducing the amount of waste materials not incorporated into the final product. This places the focus directly on the product and the conservation of materials, and results in economic, environmental, and social benefits. GM has also set aggressive goals to reduce energy and water usage at its manufacturing facilities (Vision & Strategy)." The company also create a worldwide health and safety initiative in 1995 (Vision & Strategy). This initiative has been instrumental in decreasing levels and illness and injury amongst GM employees (Vision & Strategy).

Organizational Behavior

Leadership and management

As it pertains to leadership and management GM has a rather complex system as a result of the size of the company and the nature of the products that the company manufactures. The governing body for the organization is the Public policy Center. According to the "Vice President, Environment and Energy and Chief Environmental Officer; Vice President, Corporate Relations and Diversity; Vice President, Government Relations; and Chief Economist lead the Public Policy Center and report directly to the GM Vice-Chairman (Management Structure) ."

Organizational structure

The chart below (taken from "Management Structure") depicts the organizational structure at GM. GM is a large company and as such the organizational structure is rather complex. The board of directors and the automotive strategy board are responsible overseeing the entire company which is broken divided further into four regional boards: 1. North America, 2. Europe, 3. Latin America, Africa and Middle East 4. Asia Pacific

General Motors is committed to developing and implementing certain initiatives that are designed to make the company more efficient and profitable. One the ways in which the company accomplishes this is through the Public Policy Committee of the GM Board of Directors which can be found in the structure above. The committee serves the purpose of pursuing GM's pledge to carryout its global business in a ways conducive with meeting the needs of the shifting demands of various markets (Management Structure). The Committee is responsible for several areas including

"research and development, automotive safety, environment, diversity, health care, trade, corporate social responsibility, and economic development . The

Committee provides public policy guidance to management in order to support

GM's progress in growing the business globally within the framework of GM's core values (Management Structure)."

Grouping and Teamwork

Teamwork is also a strategy that GM employs. The company recognizes that synergy is rather important (Management Structure). To this end, throughout the company there is a cross-functional team concept which is encouraged by GM's Public Policy Center (Management Structure). This functional team concept involves a series of cross-sector teams that are formed to deal with specific policy issues (Management Structure). The organizational structure found in the report demonstrates the four centers of expertise around which the Public Policy Center is arranged (Management Structure). All of the four centers have an area of expertise for which it is responsible for different issues (Management Structure).

In addition to this type of teamwork the company also engages teams amongst lower level employees. These team exists in every sphere of the corporation and are needed to ensure that the goals of the company are met. Teamwork is one of the most comprehensive ways that a company can meet its strategic goals in a timely manner.

Organizational Culture

According to General Motors the corporate culture is one that has as a foundation mutual respect, inclusion, understanding and responsibility (Around the World).. However, outsiders and some previous employees ague that the corporate culture at GM is a major problem that has contributed to the demise of the once prosperous company. According to Krolicki (2009) "What GM needs…is a radical shake-up of an inward-looking, century-old corporate culture dominated by financial executives focused on chasing the next deal in a failed effort to reverse the automaker's decades-long decline.

Many middle managers and other salaried workers, they say, have been too comfortably cocooned for too long (Krolicki 2009) ."

It is important that as a new strategic plan for GM is developed and implemented special attention be paid to the corporate culture and the changes that need to take place within the corporate culture. The company cannot continue to keep operating in the same fashion. The old system is broken and the corporate culture is part to the reason for the demise of the company as such the appropriate changes must take place to ensure that the company will have a future.

Information Systems

GM utilizes information systems in every aspect of the companies operations. Information systems is used for supply chain management, the engineering and designing of new automobiles, tracking inventory, hiring new employees and a plethora of other business functions. However, one of the most unique uses of information systems at GM is the OnStar technology. OnStar is a touch button system that provides owners of GM vehicles with information, safety and security. The Onstar system can provide drivers with direction if they are lost. The system can also contact emergency personnel if there is a crash or the driver needs help for any reason. In addition if there is a crash if airbags deploy OnStar can find the location of the car and notify emergency personnel ("Pioneering Mobile Communications").

Conclusion

The large size of General Motors makes that organizational structure of the company somewhat complex. It is apparent that some to the organizational behaviors present at GM need to change if the company is to be transformed. The company is on the cutting edge as it relates to certain types of technology. However the company seems hesitant to adopt policies that would breathe new life into the company as it pertains to creating innovative products.

Human Resources Management issues

Introduction

In all companies human resources management is vitally important, GM is no exception. Companies must take seriously the needs of their employees as it pertains to their ability to carry out tasks and meet the goals that the company has established. To this end, there are several human resources management issues that GM must confront. In the next few paragraphs these issues will be discussed.

Resourcing and legal issues;

Within the automotive industry one of the major issues is ensuring the safety of employees who work on the assembly line. These employees work with heavy equipment that can be quite dangerous. With this understood the company has certain legal obligations such as properly training employees on how to properly used the equipment, carrying the appropriate amount of insurance in case an injury occurs and reporting all injuries that occur. In addition, the conditions of the assembly line has to be in compliance with the standards established by OSHA. "This means following procedures for reducing accident risks, and it means using equipment safely. It means following safe workplace practices -- no exceptions, no shortcuts (Winning with Integrity)." GM encourages employees to promptly report to supervisors any concerns as it pertains to safety violations. This cooperation is needed from employees so that the company can correct situations that may be dangerous for employees and possibly customers (Winning with Integrity).

The company also understands it legal obligation as it pertains to complying with regulations, environmental laws, and GM's own policies and standards. GM Units that do not meet certain established codes or regulations must correct the situation in an timely and efficient manner (Winning with Integrity). In addition, GM's legal department should be notified immediately if a situation of noncompliance exist. In addition if employees believe that a noncompliance issue is present at a certain unit, this should be reported immediately (Winning with Integrity).

GM also complies with equal opportunity employment policies. Not complying with Equal employment opportunity standards can result in legal action. GM understands the importance of this issue in fact,

"GM is committed to equal employment opportunity. GM extends employment opportunities to all qualified applicants and employees and strives to maintain workplace environments free of discrimination, hostility and physical or verbal harassment with respect to age, race, color, sex, religion, national origin, disability, sexual orientation, gender identity/expression Definitions, or being a disabled veteran, a veteran of the Vietnam Era, or other covered veterans. GM

employees are entitled to a work environment free from conduct that even appears disrespectful. Certain jokes, cartoons, pictures, language, gestures, and touching may offend people and may result in a hostile work environment, which GM does not tolerate (Winning with Integrity)."

In addition the company encourages potential employees and employees who feel they have been discriminated against to report the discrimination to an HR representative, supervisor or through the use of internal complaint procedures that the company has established (Winning with Integrity). In addition the Global Security aware line is available to employees throughout the world if they want to file a complaint (Winning with Integrity).

Skills

The level and type of skills that employees posses depends on their position within the company. Of course those who are employed amongst the ranks of top management are highly skilled, experienced professionals. In other aspects of the business skill is also based on experience, this experience may have been derived from years of working at GM or at another automobile company. Overall, the company desires to have the most skilled employees in all sectors of the company.

Training and development

It is vitally important that GM workers are properly trained to perform their duties. As it relates to assembly line workers proper training is inclusive of safety measures to minimize the possibility of injury. Workers must also be trained as it pertains to the manufacture of automobiles.

Coaching and mentoring

General Motors is committed to forging a company in which employees feel in the workplace. GM wants employees to feel confident in the carrying out of their job duties. To this end the company has mentoring programs which allow new recruits to have mentors who assist them in better understanding the company and the job duties that they are expected to perform. GM has three separate career tracks business, technical and manufacturing. There are mentoring programs within each of these career tracks.

Performance and motivation

Like many large companies, GM offer employees incentives when certain goals are reached. These incentives help to motivate employees in the timely completion of projects and meeting other goals. GM employees also receive competitive pay which is a motivation in and of itself for them to work in ways that guarantee success.

Conclusion

Human resources is a critical aspect of any company as they work directly with employees. The major human resource issue seems to be health and safety because of the nature of GM's business.. Other issues include equal opportunity employment, environmental laws and governmental policies. The company also want employees to be motivated and confident and it has developed programs that meet these needs.

SWOT Analysis

Strengths

Brand Recognition/Brand Loyalty- The GM brand is very recognizable and as such people are more likely to purchase cars from the company than from some of the automobile companies that are not as well-known. In addition many people are loyal to the GM brand. That is there are consumers whose families have been purchasing GM vehicles for many years and they have developed a loyalty to the GM brand. If the company creates products that appeal to these consumers they will continue to purchase GM automobiles.

Global Presence- GM has a presence throughout the world which is useful because it allows the company to operate in various markets simultaneously. This allows the company to diversify its product offerings based on the demands of individual markets. Making products that are unique to each market can assist the company in increasing profitability.

Weaknesses

Lack of hybrid/fuel efficient vehicles- One of GM's major weaknesses is that it has been slow to develop and bring to market more environmentally friendly/fuel efficient vehicles. At the same time competitors such as Toyota and Honda have developed Hybrid cars that are cost effective and fuel efficient. These vehicles are also reliable. In this respect GM does not have a competitive advantage

Poorly aesthetically designed vehicles- many of GM's designs are outdated and don't appeal to some buyers. Many f the vehicles are not aesthetically appealing. As a result consumers chose to purchase vehicles from other manufacturers that have sleeker designs.

Lack of sells/decrease in profitability- GM is struggling at the current time t sell vehicles. Although all auto companies are having difficulties in this respect, American automakers have been hit particularly hard. This is a major weakness that has already had a negative impact on the company.

Opportunities

Take advantage of the restructuring taking place- GM can use this time of restructuring to reinvent GM. The new GM will probably be smaller but it can also be profitable.

Development of vehicles that are environmentally friendly -- the company has to make a concerted effort to develop vehicles that are fuel efficient. In addition to hybrid vehicles, the company must also focus on the development of electric vehicles and vehicles that utilize other types of alternative energy. If GM is to be success

Threats

Foreign Competition in the development environmentally friendly vehicles- GM has spent many years ignoring the reality of a changing environment toward the use of fossil fuels. In today's climate consumers want vehicles that are fuel efficient, cost effective and of good quality. Foreign automobile companies such as Toyota and Honda have been working in the development of these vehicles for many years. In fact Toyota has the best selling hybrid in America with the Toyota Prius. GM's unwillingness to pursue the development of these types of vehicles is now posing a serious threat to the companies ability to make a profit and may continue to be a threat for years to come.

Failure of the restructuring- If the current plans that the company has formulated to restructure GM is not successful, the company may face the possibility of a complete collapse.

Continued tightening of the credit market- one of the major causes for the slump in the sell of automobiles has been the lack of availability of credit. For the last year it has been difficult for people, even those with good credit, to secure a car loan. Over the last couple of months credit has began to loosen but the economic environment is one of uncertainty. If the credit market tightens again GM may experience even more difficulty as it pertains to the ability to the company to sell vehicles.

This SWOT analysis demonstrates that GM has several aspects of its business that should be addressed. In addition the company needs to reaffirm the image of its brand. Although the company has its brands name as a strength in recent years the quality of the automobiles produced by GM have not been up to par with other companies such as Toyota and Honda. Additionally some consumers fear that if the company folds, their will not be any available maintenance of GM cars, even with the assurance of the federal government. In this respect GM has a serious image problem that must be corrected.