Business Case Study: A Case Study Of General Motors

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Background of the Company 

  1. Name of Company: General Motors Company or General Motors
  2. Year of Formation: 1908.
  3. CEO: Mary T. Barra
  4. Products of the Company: Vehicles, especially cars. Cruises, Car Equipment, Financial Advisory regarding car, Military Vehicles, Boats, Online Banking, Equipment for Marine Vehicles, Car Sharing applications and Customer Advisory regarding car elated problems. 
  5. Annual Revenue: $147.049 billion.
  6. Countries in which it Operates: It has worldwide presence except the following countries, India, Hong Kong, South Africa, Sudan, Pakistan, Syria, Macau, Afghanistan, Cuba, Somalia, Iran and North Korea. 
  7. Net Operating Cost: $11.783 billion
  8. Ad Expenditure: $3.14 billion.
  9. Net Sales Volume: $35.36 billion
  10. Main Competitors: Tesla, Volkswagen, Toyota, Ford Motor, Daimler, and Fiat Chrysler. 

Background of the company’s product

BCG Matrix of the products:

The BCG Matrix provides brief idea of the market presence of the products of an organization, and  at the same time, it provides an idea of the business process of the products of the company, considering the organization, General Motors, it can be said by Ana, a senior consultant at Myassignmenthelp, “that the Financial Services option of the organization is the Star product of the company. This particular service shows a potential in the market, in the future”. 

Similarly, the Number 1 Strategic Business Unit is also a star product or service of the company. It generates the greatest sales within the company, and according to the researchers, in the future this particular segment of the company is likely to be more beneficial. 

Cash Cows:

The supplier managements services provided by the organization is essentially to be regarded as the cash cow for the company. This particular segment of the company has been consistent over the time, and has helped the organization to generate as much revenue as possible, therefore, it is likely that this particular segment of the company will be providing more business along with more revenue to the company. 

According to Amy from Assignment.reviews head marketing department- “The second cash cow for the company is the Number 3 brand strategic business unit. General Motors is the leader in the market, in this particular field with its innovativeness in the market, which has earned it 25% of the market share”. 

The researchers and the statistics have suggested that the food strategic business unit of the company is also cash cow, as it has also remained consistent in providing a steady revenue to the company. It has over 30% market share, with a large and loyal customer base. 

Question Mark:

The local food strategic unit is the prime question mark for the organization. The recent trend is suggesting that the consumers are more interested in the local food, rather than the international food, but at the same time, if the revenue of this service is observed and the market share of the same is reviewed then it can be seen that in both the aspects, this particular business unit has a negative outcome. 

Also, the number 4 strategic business unit is a question mark for the organization. This particular segment is observing a steady decline in the market share, as well as a steady decline in the revenue structure. Though this part of the market is rapidly growing, however, for the company this has remained a huge loss yet, and the innovation policies have failed miserably. 

Lastly, the Confectionary strategic business unit of general motors is also to be regarded as a cash cow. This is one of the most attractive segments of the market, and there are a number of organizations who are doing great in this field. However, the company is not really doing a great business rather it has faced a huge loss in the field. Low reach and poor distribution and a very unorganized supply chain management is the prime reason for this. 

Dogs:

First and foremost, the plastic bags strategic business is a dog for the company. This particular business initiative had been in the loss for the last five years, and there is no potential in the future as can be observed.  More importantly, the market where it is dealing, has been declining for the last two years. 

The synthetic fibre products of the organization is also a dog in the market. There is a steady decline in the market needs as the trends are changing. According to Essaycritics stats “The organization is facing a loss situation for the past three years and the market share has also been reduced to 5% in the market”

The artificially flavoured products of the company are also regarded to be the dogs for th company, as there is little Exposure and the market share is steadily declining. Though this particular business investment is rather new and the researchers had expected this to grow, but the current trends of the market, is saying otherwise, and the market for the company is shrinking.

The number five business strategic management is also a declining business sector for the company. This particular industry is been declining for the last five years and the company has even observed negative profits in this segment. Therefore, this is essentially a Dog in the BCG Matrix of the company. 

 

Background of the task force environment and their interplay

SWOT Analysis:

In order to understand the internal environment of the organization and to understand the market situation for the company, it is important to understand have a complete understanding of the strengths and the weak areas of the company, which can be only understood through the SWOT Analysis. 

 

Strengths 
  • The organization has made certain joint ventures with the Chinese automotive organizations which has impacted positively upon the company. 
  • The organization has a huge market share in the US automotive market; therefore, the strong market presence impacts positively upon the organization. 
  • The organization practices sustainable environmental policies which also helps the organization to develop a strong market position and presence. 
  • Also, the safe and environment friendly vehicles help the organization to get an advantageous position in the market.
  • Also, the vintage section of the organization, is one aspect which very few organizations provide the consumers. 
Weaknesses The company does not believe in promoting business through strong advertisements; therefore, it has failed to create the brand awareness among the mass. 

Another weak point is that though the organization has a worldwide market presence yet, the maximum of its market share comes from the American revenue. 

Another major drawback of the organization was that it had invested wrongly into the businesses of SUVs and pick up trucks, which was apparently a bad business decision for the company accompanied by a number of consequences. 

Opportunities The lowering fuel prices in the country is heightening the sales of the SUVs and the pick- up trucks.

Since the organization has diversified its products, therefore it is taking more time before launching a new car. This has also impacted the company positively.

The increasing requirements of autonomous vehicles, has also increased the opportunities and the probable market exposure for the company, 

Threats The market competitors possess a huge threat to the organization.

The increased government regulations and the rise in the exchange process of US money, both are jeopardizing the growth of the company. 

 

PESTLE Analysis:

Political Promotions by the governmental advisory.

Political untenability.

Rigorous tax policies by the government of the country.

Economic Hugh growth of the market opportunities.

Economic stability of the organization. 

Increasing competition in the market.  

Social An increased demand for the electric buses or the buses which is sustainable in nature., Increasing demand of self- driving cars, and the ride hailing program also increased the market position of the company.  
Technological Increased demand for the automated and the electric vehicles.

Also, with this demand the implementation of the fuel efficiency has increased along with the implementation for self- driving vehicles. 

Environmental Climate change. 

Rising interest in the sustainable business policies.

Legal  Increased environmental and automobile safety policies.

 

State the problem: 

The organization is faced with a number of problems. Since the time of the depression and the need for including the environmental aspects within the culture.

Select one of this problem: 

one of the biggest problem that the organization is facing is that, the company is primarily involving a business in America. Though having a worldwide presence, the organization is essentially within the American market, which is affecting its positions in other countries and more importantly, it is affecting the revenue structure of the organization. Having been dealt strategically in other countries as well, the organization would have earned more revenue. 

Brief overview of the problem with facts: 

The organization has observed more than 3000 sales in the past year in United States. However, if the market of other countries is observed, then it can be seen that the organization has not even crossed the sales of 500 cars a year. 

Suggest possible solutions: 

General Motors have never tried to rigorously promote its business, which is one essential aspect of failing to gain as much market in other countries.

Also, the organisation must take proper strategies to develop its position and its selling point in other countries.

The organization must also take strategies and found the gap in the culture and in the social needs and therefore plan for cars accordingly. 

 

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