Ldr 531 an Avoidable Failure
An Avoidable Failure: Organizational Behavior at General Motors
LDR/531
Leo Maganares
An Avoidable Failure: Organizational Behavior at General Motors
North Americans have developed a love affair with the automobile. Since the turn of the last century, the car has become interlaced with popular culture; learning to drive and owning one’s first vehicle remain rites of passage toward adulthood. Vehicle ownership continues to signal independence and even alludes to an individual’s socio-economic status. In addition to the freedom the vehicle imparts to social networking, means of independent transportation have permitted meaningful economic and health benefits through increased means of productivity and more expedient access to emergency services. This paper shall demonstrate that the demise of General Motors (G.M.) as an independent, profitable and once dominant automobile manufacturer could have been predicted and avoided by studying and implementing the lessons of organizational behavior theories specifically pertaining to leadership, management, and organizational structures.
Traditionally the demand for vehicles has been supplied by large automobile manufacturers and the development of supporting infrastructure. This leads one to question what factors preceded GM’s 75% drop in share prices over 10 years (Wasserman, 2009). Unfortunately for G.M.’s financial situation, the unmitigated internal mismanagement and lack of profitability stemming from uncompetitive products were eventually beyond internal control by the recent economic downturn. Thus, G.M. sought Chapter 11 bankruptcy protection on June 1, 2009 and, subsequently received $50 billion in a taxpayer bailout (King, McCracken & Spector, 2009). Of note, the variables responsible for the bankruptcy may be understood and could have been predicted through the study of G.M. `s organizational behaviors. Grasby, Crossan, Frost, Haywood-Farmer, Pearce and Purdy (2004) define organizational behavior as an
LDR/531
Leo Maganares
An Avoidable Failure: Organizational Behavior at General Motors
North Americans have developed a love affair with the automobile. Since the turn of the last century, the car has become interlaced with popular culture; learning to drive and owning one’s first vehicle remain rites of passage toward adulthood. Vehicle ownership continues to signal independence and even alludes to an individual’s socio-economic status. In addition to the freedom the vehicle imparts to social networking, means of independent transportation have permitted meaningful economic and health benefits through increased means of productivity and more expedient access to emergency services. This paper shall demonstrate that the demise of General Motors (G.M.) as an independent, profitable and once dominant automobile manufacturer could have been predicted and avoided by studying and implementing the lessons of organizational behavior theories specifically pertaining to leadership, management, and organizational structures.
Traditionally the demand for vehicles has been supplied by large automobile manufacturers and the development of supporting infrastructure. This leads one to question what factors preceded GM’s 75% drop in share prices over 10 years (Wasserman, 2009). Unfortunately for G.M.’s financial situation, the unmitigated internal mismanagement and lack of profitability stemming from uncompetitive products were eventually beyond internal control by the recent economic downturn. Thus, G.M. sought Chapter 11 bankruptcy protection on June 1, 2009 and, subsequently received $50 billion in a taxpayer bailout (King, McCracken & Spector, 2009). Of note, the variables responsible for the bankruptcy may be understood and could have been predicted through the study of G.M. `s organizational behaviors. Grasby, Crossan, Frost, Haywood-Farmer, Pearce and Purdy (2004) define organizational behavior as an
References: Grasby, E., Crossan, M., & Frost, A., Haywood-Farmer, J., Pearce, M., & Purdy, L. (2004). Business decision making: Test and cases (7th ed.). Toronto, ON: Nelson. King Jr., N., McCracken, J. & Spector, M. (June 1, 2009). Potential Conflicts Abound in Government Role. The Wall Street Journal, p. A14 Vlasic, B. (November 13, 2009). After Bankruptcy, G.M. Struggles to Shed a Legendary Bureaucracy. The New York Times. Wasserman, B. (2009). The death of GM: A much needed wake-up call. Retrieved from http://www.huffingtonpost.com/bobbie-wasserman/the-death-of-gm-a-much- ne_b_210542.html