Company Analysis Before Bankruptcy (2009):4
Porter’s Five Forces Analysis:4
Organizational Structure and Design:4
GM Goals and Plans:7
GM Motivational Tactics:7
Company Analysis After Bankruptcy (2009):9
Porter’s Five Forces Analysis:9
Organizational Structure and Design:9
GM Goals and Plans:11
GM Motivational Tactics:11
On June 1st, 2009, General Motors officially declared bankruptcy after having many problems and holding too much debt. The bankruptcy led GM to restructure using the turnaround strategy and build a new company. This report will discuss several dimensions within GM, before and after bankruptcy, including SWOT and Porter’s Five Forces Analysis and other organizational, cultural, and strategic changes.
General motors (GM) is an American multinational automobiles corporation founded in 1908 in Flint. It is one of the largest car manufacturers in the world and its headquarters are speeded through out the United States. GM is known as the sale leader from 77 years till now, and it sells and services under the brand names of Buick, Cadillac, Chrysler, GMC, Chevrolet, Vauxhall, Daewoo Holden, Opel, and Former GM automotive brands include Oakland, Oldsmobile, Pontiac, Hummer, Saab, and Saturn. GM operates in 157 countries and employee 202,000 employees. It also produces cars and trucks in over 31 countries worldwide. As of 2008 GM became the ninth largest publicly traded company in the world, but in recent years the company endured some serious financial troubles, which caused a 38 billion dollar loss in one year. (Thomas) Company Analysis Before Bankruptcy (2009):
Porter’s Five Forces Analysis:
Organizational Structure and Design:
Organizational Structure is the formal arrangement of jobs within an organization. (Management AWE, 2009) We will talk about Specialization, Departmentalization, Chain of Command, Span of control, Centralization/Decentralization, and Formalization under this section.
Specialization- GM was very concerned about the way their production process flows and therefore, they had productivity as one of the main objectives in the company. However, Specialization is one of the main factors that contribute to productivity. Therefore, GM concentrated on implementing and maintaining a high level of specialization. Specialization is definitely an effective strategy to increase productivity, which also leads to opportunity of enjoying economies of scale (Koch), but, however, it left little area for creativity and innovation for employees. Moreover, Specialization was an important part of Weber's principles of bureaucracy that GM's management was following.
Departmentalization- GM did not have a direct departmentalization method but they grouped their jobs by using the product departmentalization within the Geographical region. Therefore, we can say that GM gave a higher priority to geographical departmentalization compared to product departmentalization, but has successfully achieved both of them in their departmentalization strategies.
Chain of Command- It is the continuous line of authority that extends from upper level to lower level management. (Management AWE, 2009) GM emphasized on maintaining a vertical design of the organizational structure and therefore they had longer organization levels, which means that they had a long chain of command. A long chain of command was bad for GM because it lead to more organizational levels and therefore, they paid more for the workers. Moreover, longer chain of command made communication between high-level and low-level management harder.
Span of Control- Emphasizing on a vertical shape design in the organizational structure will...