28 Sept. 2014
Case Analysis #1
“Will GM's Strategic Plan Lead to Future Successes?”
1. GM is using the prospector strategy to boost sales and increase overall income each year to raise their profit margin to the highest in the auto industry. If they achieved this they would be a huge competition to other car manufactures. The company made many changes to GM internationally to try to find new ways to increase profitability while decreasing costs. They stated that they cut their global work force from 263,000 to 208,000 because of the turnover. This huge cut to the global work force decreased cost for GM which was a strategy save income. If they didn't try to change things for the company they could have been at risk of bankruptcy within the company. Focusing on profits and healthy margins helped GM regain the title of world's largest auto maker.
2. GM's vision consists of achieving the highest profit margin in the automobile company and the highest overall income in the industry. Their vision sounds realistic according to their increases in their income from 2010 to 2012. An increase of 4 billion dollars every 2 years is a significant increase in income which could lead to GM making the most income of any company in the industry. It is going to be hard for them to take the title of the company with the highest profit margin. The article stated that BMW and Hyundai were estimated to receive a 10% profit margin in 2011. With this being said, it would be hard for GM to jump from a 6% profit margin to a 10% margin in a little amount of time. Hyundai and BMW both would most likely achieve an even higher profit margin than 10% by the time that GM received a 10% profit margin.
3. One of the main goals of GM is to make more than $10 billion a year. This goal is definitely a realistic and achievable goal for the company if they follow the steps they need to. Based on their statements, GM has an average of a 2 billion dollar profit increase each year. In