Management 303 Swot Analysis of General Motors Company

Management 303 SWOT Analysis of General Motors Company

Section I - Organizational History

General Motors has been in business for over a century and has seen many changes and experienced much upheaval in that time. It was founded in 1908 and celebrated 100 years of business in 2008. They employ over 200,000 people and conduct business in over 150 countries, truly a global company. Unfortunately, in 2009 GM was forced to declare bankruptcy due to an economic downturn and continuing quarterly losses. The company had to seek government aid to stay afloat and save millions of jobs. GM is now called the General Motors Company (previously known as the General Motors Corporation) and is referred to as the 'new GM'. The company is in a much better position financially since the bankruptcy, and has filed paperwork for a proposed initial public offering. GM's vision is to design, build and sell the world's best vehicles.

Section II - Strengths and Weaknesses

I would consider two strengths of GM's to be technology and their current financial situation. Two of GM's current weaknesses are the constantly changing leadership and dissatisfied employees.

Strength #1 - Technology

GM has made great strides in technology and keeping up with the latest social media trends. The greatest example of their advanced technology will be available this year in the Chevrolet Volt. This vehicle will run for up to 40 miles without using a drop of gas, but it does have a fuel tank like a normal vehicle. If you are planning a longer trip you can just fill up with gas like in any other vehicle and do not have any 'range anxiety' as associated with purely electric vehicles.

Another great technological feature of GM is the OnStar system that is standard on all new vehicles. This system allows you to contact a service representative 24 hours a day at the touch of a button. They can help you with anything from directions to vehicle questions. The system also allows you to buy minutes for your vehicle to place hands-free, voice dialed calls any time you are in the car. GM is shortly going to tie in the OnStar system to your Facebook account as well so you can hear new status updates, and also hear your text messages from your phone. There is also a new app for Smartphone that allows owners to check the statistics of their vehicle and perform functions such as remotely starting their car. The most important feature of the OnStar system is the automatic crash response. Any time a crash situation is detected and an airbag is deployed, the center is automatically called from your vehicle and a live person speaks to you to verify that you are alright, and if not they immediately call for help. No other company has such a platform in effect, making this a distinctive competence for GM.

Strength #2 - Current Financial Situation

After losing money for years and going through bankruptcy proceedings, GM is now looking much better financially than it has in a long time. GM has posted a profit for the last two quarters, something it has not done in a great many years. The company had the opportunity to shed many locations, assets and equipment that it no longer needed through the bankruptcy. They also negotiated many concessions from the union that will benefit the company far into the future including lower starting wages, taking over responsibility for union employee's retirement funds and fewer vacation days. GM benefited from the decision of the government to save it, along with the help of the UAW and CAW and in turn this advantage gave it a distinctive competence. Chrysler also received some financial help through bankruptcy as well as UAW and CAW concessions, but not the amount that GM did. Their financial picture does not look nearly as good as GM

Weakness #1 - Revolving Door Leadership

As noted in the article, "GM outlines risks to buying stock, including inexperienced management" by G. Gardner (2010), "GM has substantially revamped its management team and will have a new CEO who has no automotive experience, Dan Akerson, on Sept. 1." This is the 4th CEO GM has had in the last few years, and in addition to changes at the top spot in the corporation, each new CEO brings a cascading reorganization of the company that leaves heads spinning as to who is currently in charge. The new CEO must stay in place for at least the next few years to exude a feeling of stability to both employees and investors. I would also recommend that further leadership changes be very thoroughly evaluated to make sure it is the best decision, and we are not moving people around without a definite need to.

Weakness #2 - Dissatisfied Employees

Due to the instability experienced over the last few years, many employees are still experiencing uncertainty and turmoil in their work situation. Many plants were closed, causing massive layoffs, job losses and relocations of employees. A great many of these employees are not happy about having to move to a different state or plant to retain their jobs. In addition, many benefits were also taken away and wages were frozen. There is still a prevailing feeling of uncertainty concerning the company as well, with employees second guessing whether they want to stay and continue to weather the storm, and if there is opportunity for advancement or global training in the new GM. These opportunities were also frozen through the bankruptcy, and many individuals were demoted to retain their jobs.

The company has already made some moves to improve on this weakness, reinstating raises based on performance and reinstituting some of the previous programs such as tuition assistance and 401k matching. I believe the company could help the uncertainty by reassuring employees that their future with GM will include possible promotions or personal growth initiatives.

Section III - Opportunities and Threats

Two opportunities that are currently presented to GM are international growth and the timing of their two new vehicle launches this year. Two threats to GM are the economic slowdown and the current political environment.

Opportunity #1 - International Growth

Although the North American vehicle market has slowed down recently, GM has been making great strides internationally. In the first six months of the year, GM sold a little over 1