PSA Peugeot Citroen Using Evidence

PSA Peugeot Citroen

Using evidence and illustrations from your research describe and explain how Peugeot Citroen could improve their operations by having clear and strategic objectives.

Despite Peugeot Citroen's current difficulties, it can learn valuable lessons from the example of General Motor's recent descent into bankruptcy. GM is currently 'shedding' defunct brands and developing into a leaner company. The focus on fuel-efficient cars in Europe makes it even more critical that Peugeot Citroen explores the possibility of creating a wider array of hybrid vehicles. Emphasizing sustainability in its vehicle designs and re-branding itself in a clearer and more coherent fashion are both critical objectives for the company. Peugeot Citroen needs a new image to market itself in the car market of tomorrow: green and lean, yet high in quality. Currently, the company does not 'stand' for anything, and this fuzzy focus and inconsistent quality has caused customers to turn away in droves.

Q2: Clearly evaluate how Peugeot could meet their organizational objectives if they manage to get their operations objectives right.

An exciting opportunity is offered by China and India's new thirst for cars. Currently, the bulk of GM's revenue is derived from the inroads it has made into the Far East market. Peugeot Citroen has attempted to buy between 30% and 50% of the failing Japanese company Mitsubishi to better enable it to expand its operations in China: but because of Peugeot's cash flow problem, the deal is on shaky grounds. Furthermore, culture clashes between Mitsubishi and Peugeot Citroen personnel combined with the fact that Peugeot already sells an unpopular, rebranded version of Mitsubishi's Outlander SUV does not bode well. Entering into a merger to sell SUVs in the developing world seems like focusing on what is becoming a vehicle design of the past, rather than the future, as well as an organizational strategy of the past (merging with another troubled company). Creating a new, leaner style for a fleet of fuel-efficient, small, affordable vehicles for the expanding Chinese market would likely draw investors and inspire confidence, despite Peugeot Citroen's junk-rated debts of $3 billion (Asian alliances, 2009, The Economist). Shedding brands, resisting the impulse to add another company under its fold, and instead creating a disciplined and coherent script for its dealers around the world, and a single, quality-controlled process to govern its factories seems a better way to deal with its current organizational difficulties.