General Motors

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Recommendations and Action Plan to bring about the changes needed at General Motors

INTRODUCTION

This research paper presents some recommendations and a related action plan to address the strategic changes which are deemed crucial to the survival of General Motors (GM). An overview of the contemporary situation at the corporation is provided in this section of the paper, which is then followed by specific recommendations and a strategic plan of action to bring about the changes which are necessary for the company’s survival in these turbulent times.

The recommendations and action plan are framed within the concept that “the strategic management process is based upon the belief that organizations should continually monitor internal and external events and trends so timely changes can be made as needed.

In the first instance an overall justification and rationale for change should be the primary concern which guides any strategic undertaking, hence, the extent of change as to be instituted by General Motors (GM). As Mintzberg et al. (1998) point out, ‘Every strategic change involves some new experience, a step into the unknown, the taking of risk. Therefore no organization can ever be sure in advance whether an established competence will prove to be strength or a weakness.’ (p.34). In this regard, for General Motors (GM) it may be argued that the established competencies at strategic level are few, whilst the need for change is absolute. Hence, this report sets out how effective change could be realized through:

' The adoption of a recognizable Relationship Marketing Approach.

' The re-configuration of General Motors as a recognizable Learning Organisation with enhanced Employee Involvement practices.

' The redress of financial deficits through the more widespread adoption of Total Product System (TPS), and correlative achievement of a shortened cash conversion cycle/stock conversion period.

First, a relationship marketing (RM) approach is not predicated purely upon marketing itself, but the re-location of the customer or end user at the centre of operational logic. As Christopher et al. (2002) point out, “this is not some altruistic or idealistic view of the firm as the provider of customer satisfaction at any cost, rather it is a hard edged business model that recognizes that long term profits are more likely to be maximized through satisfied customers who keep returning to spend more money” (p.2).

Second, the learning organization approach to influence change relies on the re-configuration of the macro and micro levels of the manufacturing process around the collegiate pursuit of end-user satisfaction. This notion is supported by Hyman and Mason (1995) who point to the fact that “the learning organization is one in which managers perceive their position in the organization, and their relationship with subordinates, in a radically new way, utilizing new metaphors and ways of understanding (p.145).

Hyman and Mason (1995) even went further to suggest that, ‘Japanization’ was the key to the development of ‘learning organization’ that focuses on Employee Involvement practice (p.144). The cumulative effects of such changes, Hyman and Mason (1997) contends can be achieved through the pan-corporate adoption of a Toyota Production System (TPS) and this should facilitate an uplift of net present value through the dramatic reduction of buffers of inventory.

Adopting the Toyota Production System (TPS) call for careful examination of the whole manufacturing process from the customer’s point of view, for it is only through the customer’s eyes; those companies such as General Motors (GM) are in a position to observe a process that separates the value added activities from the non-value added activities (Liker, 2004, p.27).

General Motors already has some experience of these operations through its New United Motor Manufacturing Incorporated or NUMMI joint corporate venture with Toyota...
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