Strategy and Prioritization Selection/ Action Plan

Posted: September 5th, 2013

Strategy and Prioritization Selection/ Action Plan







Strategy and Prioritization Selection/ Action Plan

Strategy and Prioritization Selection

Executive Summary and Background of the Organization

Founded in 1908, General Motors has gone on to establish itself as a global vehicle manufacturer with its headquarters based in the United States. The automobile company is the largest of its kind as declared by its product sales and has been leading in vehicle sales for the last seventy-seven years. Around the world, General Motors provides employment to 256,000 plus workers (General Motors Corporation., 2009). As of 2008, the company was declared the ninth largest global publicly traded company. Despite its success, the company has however had to endure financial crises such as the 2007 38 billion dollar loss. There is need for General Motors to revise a strategic and prioritization selection plan that will incorporate the next vehicle generation. With regard to the current competition in the automotive industry and global economy, the company cannot afford to procrastinate.

External and Internal Assessment  

As a global company, General Motors envisions becoming the leading icon in transportation products as well as services related to this field. The company plans to earn consumer trust and enthusiasm through progressive improvement facilitated by innovation, teamwork, and integrity. However, due to factors such as global warming concerns, rising fuel prices, and the ever-changing global economy, it is prudent that the company takes advantage of changing consumer taste and turns its threats into opportunities. There is need for General Motors to change customer perception of the company, innovate further on its vehicles, and turn itself into an environmentally friendly company.

With regard to the automobile manufacturing business environment, the entire automobile industry is currently being bombarded by a perfect storm. In other words, General Motors and other automobile companies are being challenged rising fuel prices, a weak US and global economy, and political and social issue and concerns (Flink, 2003). If the company aims at overcoming these vices, then it would be wise to consider mass production of vehicles powered by means other than fuel, such as electricity, hybrid, or fuel cell. General Motors especially has to deal with competition from other prominent automobile manufacturing companies.

Among the main competitors to General Motors, include the Toyota Motor Corporation. Since its incorporation in 1937, Toyota Company bears a variety of competitive factors against General Motors. Toyota Company boasts three major vehicle brands including Scion, Lexus, and Toyota. Through these distinct brands, Toyota Company manages to reach many global regions through consumer sovereignty over vehicle choice (General Motors Corporation., 2009). Another major competitor to General Motors is the Daimler Chrysler Company. This company as well has much strength to its brand including many vehicle varieties such as Jeep, Mercedes Benz, Chrysler, and Dodge (Grimes, 2004). This implies that Daimler Chrysler Company is globally recognizable through its vehicle brands.

Strategy development, alternative strategy generation strategy and prioritization selection

General Motors Company has a variety of strengths that act to its advantage. These include the large market share the company enjoys. Even though the company’s market chare has significantly dropped due to competition, it still enjoys the largest market share. If the right strategies are implemented, General Motors can regain its commanding position in the market. Additionally, the company also boasts a number of vehicle brands, much to its advantage. These vehicle brands include Chevrolet, Cadillac, GMC, Pontiac, Buick, Hummer, Opel, Daewoo, and Holden. This wide variety in vehicle brands ensures the company satisfies numerous customer tastes and preference.

Despite the company’s strengths and their advantages, General Motors is however plagued by a number of weaknesses. These include a lagging pace in innovating alternative energy resources. The alternative energy trend has begun to engulf the automobile industry and General Motors is lagging behind compared to its competitors. Another weakness of the company involves stagnation in its profitability. With regard to the size of the company, General Motors is indeed struggling with its profitability (Flink, 2003). Additionally, the company heavily relies on the American market. Most of the vehicle brands are only available in the American market.

The automobile manufacturing industry bears several opportunities General Motors can utilize. These include innovating on alternative energy use for their cars. The alternative energy trend has begun to engulf the automobile industry and General Motors can utilize this opportunity to raise its competitive advantage. Another opportunity the company can utilize is the low interest rates in the economy. General motors can use this opportunity to generate an immediate rise in vehicle sales. However, there are some threats hindering the progress of the company. One major threat facing the company is the increased competition. Other companies such as Toyota and Daimler Chrysler have over the years have rapidly grown. In this industry, more competitors are soon to venture in the business (Grimes, 2004).

With regard to financial status, the company’s annual revenue has been on a downward trend in recent years. From the period running 2004 to 2007, the company’s annual revenue reduced from 193.5 billion to 192.6 billion dollars. In 2007, General Motors incurred a net loss of 10.6 billion dollars compared to the 2.8 billion dollars net income registered in 2004 (General Motors Corporation., 2009). This loss was attributed to mainly unfavorable product and volume mix by the company. In the late 90’s, General Motors registered a market share of up to 80 percent. In 200, the share would only decline because of the terrorist attacks in September 11. Because of this factor, the benefit and pension crisis of General Motors was severely affected by as well as other companies. The current stock market of the company has been fluctuating between 28 and 29 dollars (General Motors Corporation., 2009).

Action Plan

The action plan for General Motors dictates that the company should begin developing its products, followed by market development, restructuring, and liquidation. Product development begins at the list because there is need for the company to innovate in a new hybrid vehicle. This should allow the company to keep up with its competitors with regard to alternative energy sources. However, this product has to stand out from the rest in order to attract more consumers. A good example of this development would be a hybrid SUV. This example properly fits the company’s profile.

General Motors also has to re-evaluate the automobile market. For so long, the company has continued to produce vehicles with the same traditional outlook. The market is now changing and consumers are demanding new and improved products. The management of the company will need to establish how the company needs to be re-positioned with regard to the demands of the current market. An example of this move would involve the production of a vehicle that bears futuristic attributes. If General Motors can manage to do this before its competitors, this would significantly raise the competitive advantage of the company.

The other piece of the action plan of the company involves restructuring. In recent years, the company has undergone a number of setbacks and needs to find its way back to the commanding position it used to hold. This can only be achieved by a drastic change by the company. Restructuring the pace of development as well as reducing the number of employees. This makes sense because company needs to prioritize growing its profits rather than size. Last yet important, the company’s action plan should consider liquidation. This strategy is fundamental considering that the company’s assets are higher than annual revenue. If General Motors can succeed to turn part of its assets into cash, then funds would become readily available to cater for other development strategies. In addition, liquidation would also help solve any financial crisis that company might face.















Flink, J. J., & Niemeyer, G. A. (2003). The general of General Motors. American Heritage, 24, 5.

General Motors Corporation., & Princeton Institute for Historic Research. (2009). General Motors: The first 75 years of transportation products. Princeton, N.J: Automobile Quarterly Publications.

Grimes, D. M., Jones, T. O., University of Michigan., & General Motors Corporation. (2004). Automotive radar: A brief review. Ieee Proceedings, 62, 6, 804-822.

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