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One of the vital business processes that resulted in the constrained growth of General Motors (GM) was the fact that it lagged behind in technology because it had not embraced the modern market gists. Most importantly, alternative-hybrid inclination has already taken effect on the market, but GM had not yet taken advantage of this new technology.
Some minor processes were altered as a result of the changes; similarly, the new CEO is paying attention to different modalities of transforming the information technology services in the company (Motavalli, 2010). It is noteworthy that general motors has abolished the traditional IT system and has employed the use of numerous IT providers.
The company has designed a modern IT system to boost its business growth. As a result, this has ensured smooth running of the company plants with the elimination of the frequent stalling of machines in its plants. Essentially, GM has embarked on the project of building an electric car (Opel) to be tested in Germany. These changes mainly took place in the ICT and production segments of the business (Motavalli, 2010).
The other business process that led to GM’s decline was the company’s organizational structure which was vertically integrated; as a result, there was inadequate communication amongst employees. Hence, the various projects could not be completed, and new regulations were not being implemented in time. Further more; there was a disjointed communication process in the company resulting from the disunity among various departments.
This resulted in declined profits since the production process was not smooth. For instance, the company was spending a lot time in the production of one car. As a result, it led to the replacement of the top executives of the company. Thus, leading to a new system in the management hierarchy that enhanced improved communication through out the company. This process belongs to the administrative function of the business, and it is considered as the most important for any business to succeed (Jordi, 157).
General motors employed a poor market strategy by primarily exploiting the US market. As a result, its profitability was under pressure despite its vast size. This was because of rise in competition, in US market. Alteration of the process came in when the company focused more on the global market so as to overcome this competition.
Lately, the company has embraced expansion by increasing its production in the Chinese automobile market. This was a strategy to expand its market and cope with the current competition. This was a significant process in the production and operation function of the business (Cryiac, 2009).
Key among the business factors, which have constrained the growth of general motors, is their financing program, the General Motors Acceptance Corporation (GMAC) financing. Thus, the company failed to administer innovative ideas as a get way to register profit; instead, it mainly depended on the GMAC financing.
This meant that it did not introduce new brands neither did it restructure output and subsequently concentrate on improving their current lines. Currently there is an alteration of minor processes as the company is considering reducing its number of brands. For example, it is taking in to account pawning off the “Hummer” brand to any interested company. This mainly concerned the research and development function of the business (Welch, 2010).
References
Canals, Jordi, Managing corporate growth, New York, Oxford University Press, 2000. 157.
Motavalli, Jim, G.M. Building Electric Opels for Vehicle-to-Grid test in Germany, the New York Times. Web.
Thomas, Cyriac, General motors strategic analysis, Motors analysis, 2009. Web.
Welch, David, GM’s Brand Dilemma, Bloomberg Businessweek, 2008. Web.
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