Comprehensive case analysis of General Motors

Preparing a Comprehensive Case Analysis

Comprehensive case analysis of General Motors
In the recent times, there have been doubts regarding the General Motors’ survival. The doubts arise from the company’s unfamiliarity of the external business environment of the automotive industry. This comprises of the views and perceptions of consumers of present events, as well as, economic trends. In addition, there are key issues including the advancement of technology that are associated with the industry and which are covered by trade publications. Doubts also arise from challenges related to the company’s internal business environment. These challenges possibly result from the company’s following of the inappropriate generic strategy. For a number of years, General Motors (GM) dominance position was created by designing cars from varied customers for distinct departments (Fernandez and Shengjun, 2011). This action provided a broad lineup that the firm used as its basic weapon in beating back both domestic and foreign rivals. However, during the 1980s, Korean and Japanese automobile manufacturers created a considerable challenge to General Motors especially because of their successful industry entry that eliminated the profits of the company. It was during this period that consumers of the company threatened its market share especially by forcing down prices when the foreign manufacturers successfully initiated their brands into the United States market. The automobile manufacturing has not been an attractive one for the firm over the recent past. For a significant time the executives of the company had made a decision to have numerous distinct brands that necessitated then to provide over sixty distinct models of trucks and cars. There were high costs of production related to manufacturing and testing of automobiles. These expenses were catered for by the consumer. In this case, it is recommendable that the company should have started plans to cut back on the divisions of cars during the 1980s instead of adding more brands. When the company’s share of the market started to decline, it became hard for it to continue the designing and marketing of cars under various brands (Carmohn, 2010). This being the case, therefore, it is recommended that the company should apply a number of strategies to maintain its position in the industry. This will be done by looking at two matrixes and the advantages and disadvantages of alternative strategies.
SWOT Matrix

General Motors SWOT analysis 2013
Strengths Weaknesses
1. New vision and strategy
2. Global presence
3. Strong presence in China
4. Strong brand portfolio
5. Four well-performing brands
6. Knowledge of the home market
1. Brand dilution
2. High cost structure
3. Car recalls
4. Bureaucratic culture

Opportunities Threats
1. Increasing fuel prices
2. Positive attitude towards “green” vehicles
3. Growth through acquisitions
4. Changing customer needs 1. New emission standards and regulations
2. Fluctuating fuel prices
3. Intense competition
4. Rising raw material prices
5. Exchange rate
I &E Matrix
Internal External
Bureaucratic decision making Shift in consumer preferences
Business and corporate level strategy Government regulation and subsidies
Barriers to access of market
Exploiting opportunities in the market for green automobiles.

Advantages of SWOT AND I&E Analysis
SWOT analysis is an essential strategy in selection and formulation. It is a powerful technique despite that it involves a great subjective component. It serves as a guide rather than a prescription. Successful organizations base on their strengths, correct their weaknesses and ensure protection against external threats and internal weaknesses. In addition, organizations make a follow up on the overall business environment and exploit and recognize new opportunities quicker than its competitors. SWOT analysis assists in strategic planning in a number of ways (Guess and Farnham, 2000). It establishes the strength of an organization and reverses the company’s weaknesses. It is a source of information for strategic planning and maximizes its response to opportunities and overcomes the organizational threats. It serves as an essential tool in identifying the core competencies of the company and assists in setting of goals and objectives for strategic planning. The analyses help in identifying the past, present, and future using present and current data. This enables the making of future plans. The analyses give essential information that aids in synchronizing the resources and capabilities of the firm with the competitive industry in which the organization operates. I&E Analysis is also essential and performs the mentioned functions.
Limitations of SWOT and I&E Analysis
There are a number of limitations associated with the application of the two. These limitations cannot be controlled by the management of an organization. This implies that the analysis is not free from disadvantages. They may force companies to see conditions as exceedingly simple while this might not be the case. In addition, classifying items as opportunities, threats, strengths, and weaknesses appears to be subjective as there is a great level of uncertainty that lies in the market. The limitations to the analyses include increases in price, raw materials/inputs, government legislation, and economic environment. Others are inadequate research and development facilities, poor industrial relations, lack of efficient and skilled labor, and poor quality control that leads to faulty products and services (Heisinger, 2008).
Based on this, the company should implement strategy that ensures the maintenance of its position in the industry. The company should set up plans to cut back on the divisions of cars. This strategy will be based on the two analysis described in the previous sections. The strategy is essential for maintaining the powerful global vision of the company. The vision is aimed at designing, building, and selling the best vehicles in the world. This means that it improves quality. Timely decisions are essential for any business, as well as, sufficient allocation of resources. Key personnel and managers should all be focused on ensuring that all this is met. To achieve this objective, the company should be keen on the preferences of consumers in the market. This strategy is different from what the firm is actually doing as the company is focused on producing more and more cars rather than cutting down on these. This is the way towards achieving a global position in the market. This strategy can assist in reinvestments to ensure continuous improvement. Competitive pricing strategy should also be considered. The company should be concerned with core brands to remain competitive in the industry. This requires the application of high technology and advanced research and development. Cost effectiveness and maximization of revenues should not be ignored in the brand strategy. The company should adopt this strategy other than the one that is being carried out at the present. The strategy is estimated to increase the company’s sales by 1%, 2%, and 3% in 2014, 2015, and 2016 respectively.
To review if the recommendations are being followed, it is essential to monitor the progress of the company. This implies following all activities being undertaken and whether or not the schedule or timetable is being followed. However, implementing the recommendations and strategies in the company requires the involvement of all major stakeholders. The involvement of managers and key personnel is important in facilitating the achievement of the firm’s goals and objectives. Managing change requires that both the managers and employees are aware of the benefit that is likely to arise from any change in the company.
Recommended Timetable
A timetable is essential if the company is to achieve the desired goals and objectives. The following timetable includes the action items that are being suggested in implementing the change.
Date and Time Resources and Objectives Inputs
2014 Raw materials and financial resources to facilitate technological research and development. Money
Financial resources
Key personnel and managers.
2015 Technology to assist in maintaining the position of the company in the industry. Money
Financial resources
Key personnel and managers.
2016 Achieve all desired goals and objectives desired by company by the implementation of the proposed strategy and recommendation. Money
Financial resources
Key personnel and managers.

Carmohn, S. (2010). An analysis and explanation of the failure of General Motors on the basis of the theoretical framework of path dependency in the field of Crisis Management. München: GRIN Verlag GmbH.
Fernandez, J. A., & Shengjun, L. (2011). China CEO : a case guide for business leaders in China. Hoboken, N.J: Wiley.
Guess, G. M., & Farnham, P. G. (2000). Cases in public policy analysis. Washington, DC: Georgetown University Press.
Heisinger, K. (2008). Introduction to managerial accounting. Boston, Mass: Houghton Mifflin.