International Business Issues in General Motors

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Table of Contents

Introduction
Mission and Vision and Objectives
Countries of manufacture and sale
Production Facilities
Product Standardization
Organizational structure
International Strategy
Work teams
References

Introduction

General Motors is one of the biggest multinational corporations in the world. It is the second-largest car manufacturer after Toyota based on the 2008 sales units. The company was founded in the year 1908 and deals with cars and trucks in 34 countries. The headquarters are in Detroit but it has different branches in countries all over the world. General Motors brands include, Opel, Saab, Pontiac, Saturn, Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Wuling and Vauxhall. The main markets for General Motors are China, the United States, Brazil, The United Kingdom, Germany, Canada and Russia. (General Motors Corporation, 2009)

Mission and Vision and Objectives

The current vision of General Motors is to be the world leader in transportation products and related services. The company aims to keep the customers’ interest by continually improving its products. The core values of General Motors are Customer Enthusiasm, Teamwork, Innovation, Continuous Improvement, Integrity and Individual respect. (Crsglobe) The employees of the company ensure that they adhere to these values in their day-to-day performance. General Motors intends to use threats such as rising fuel prices, environmental changes and global warming as opportunities. (General Motors Corporation, 2009)

The changes in consumer habits of the market mean that the company has to change as well. General Motors wants to change the previous perception of the company in the market as a dull and of poor quality manufacturer. It intends to do this by portraying an image of quality and environmental friendliness. The values of the customer and the environmental needs will have to be considered. The customers will be listened to directly so as to give them exactly what they want. The firm intends to persuade the stakeholders of General Motors to remain in the company by giving them financial incentives and providing them with pride to be in the company. (Scribd, 2008)

The new proposed vision of General Motors is to become a world industry leader not just a follower. It will also focus on regaining the lost market share so as to become the leader in sales and market share. (Scribd, 2008)

The marketing strategy that general motors use is very different from that of other automakers. It sells its products under different brand names. Therefore the marketing mix is very complex.

Countries of manufacture and sale

General Motors is very active in Africa. The key markets are Kenya, Egypt, South Africa and Nigeria. General Motors makes use of strong partnerships and joint ventures. These ventures assemble old motor vehicles and they complement those that are imported. The main joint ventures in Africa are GM East Africa in Kenya, GM Egypt, GM Nigeria and Industries Macaniques Maghrebines in Tunisia. The acquisition of Delta Motors Corporation included General Motors South Africa in its company portfolio. (General Motors Corporation, 2009)

In North America, General Motors operates in Canada, Mexico and the United States. In South America, General Motors has large manufacturing plants in Argentina, Brazil and Chile. It also operates in Colombia, Ecuador, Peru, Uruguay and Venezuela. In this part of the world, the main brand that is sold is Chevrolet. In the Middle East, General Motors has a strong market base in Saudi Arabia, United Arab Emirates. The sales and marketing in these regions are aimed at Kuwait, Lebanon, Oman, Qatar, Syria, Jordan and Yemen. There is a lot of business for General Motors in the Asia-pacific region. This includes China, Indonesia, Japan, Korea, Thailand, Singapore and India among others. (General Motors Corporation, 2009)

Production Facilities

Production facilities of a company can either be centralized or decentralized. A decentralized production facility is whereby the company produces all the products it sells in the different parts of the world in a single country. This means that the production plants are in one country. A decentralized production is where the company has production plants in different parts of the world. General motors adopt decentralization of its production facilities. There are many production plants of General Motors in different parts of the world. Some of the General Motors factories are in Spain, South Australia, Michigan, Italy, Sweden, Russia, South Africa, Mexico, and Brazil among others. (General Motors Corporation, 2009)

Product Standardization

Product Standardization refers to the situation where the company sells the same product in different parts of the world. Some companies sell products with different characteristics. Such attributes like product quality, durability and packaging may be different depending on the part of the world they are being sold to. The market offering of General Motors is the same throughout the world. The vehicle that is sold in Europe is the same one that is sold in Africa.

Organizational structure

General Motors affairs are overseen by a board of directors. It is charged with the responsibility of selecting officers in the company and directing the operations. Below the directors are the strategy board which is responsible for the subsidiaries of General Motors. The strategy boards are comprised of the North American Strategy board, Europe Strategy board, Asia-Pacific Strategy board. There is also the Latin America, Africa and Middle East Strategy Board. The international business is run by the Public Policy Center Global Coordination Team. Sections that fall under this team are Government Relations, Trade and Economics, Corporate Relations and Philanthropy, and environment, energy and sustainability. (General Motors Corporation, 2009)

International Strategy

The two types of international strategy are decentralization and centralization. A centralized multinational company has all the product development, marketing and promotions controlled through one location. The products and services are then disseminated through the local or regional divisions. In a decentralized company, decision-making is done by different people or groups in different locations. Therefore it is possible to make decisions without necessarily consulting the parent company. General Motors seems to be a centralized organization. The parent company in the United States directly controls the subsidiaries in other countries. Therefore they make decisions on the marketing strategies, employee policies and sales targets. For example, the parent company recently ordered the temporary closure of certain manufacturing plants. (Lowe & Doodle, 2007)

Work teams

The organization of company’s employees in order to mean the objectives of the company is very important. There are two ways of organizing staff. This is using teams to perform a task or using individuals to attain the target. The types of teams are work teams, management teams, parallel teams, management teams and project teams. General Motors uses work teams in its operations.

The strategies that General Motors adopts will make the difference between its survival and its collapse. The current global financial crisis has made it necessary for management to make strategic decisions so as to prevent the company from sinking. Some of the strategies that General Motors intends to carry out are Market Development, Market Penetration, Restructuring and Retrenchment. (Scribd)

The company has restructured to be able to accommodate the current crisis. The restructuring includes job cuts and phasing out the Oldsmobile brand. This restructuring plan is very good as it will solve some of the temporary problems. In the long run, the company will benefit from its quality manufacturing and core values. Based on the strategies that General Motors follows in the company it is going to succeed in the international market. The objectives it has set can be attained by continuous application of effective policies. (CNNMONEY)

The company could consider centralization of its management and decision-making so that the decisions made are reflective of the needs in the different parts of the world. This will improve their competitive position.

References

Lowe, R & Doodle, I. (2007). International Marketing Strategy: Analysis, Development and Implementation. London: Cengage Learning EMEA.

General Motors Corporation, 2009. Corporate information. Web.

CNNMONEY. (2000)End of the road for Olds. Web.

Scribd. (2008) General Motors’ Strategic Analysis. Web.

Crsglobe. 2009. General Motors Corp. Web.

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