General Motors' Global Strategy

General Motors’ Global Strategy
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General Motors’ Global Strategy
Sustaining operational success in highly competitive industries is a challenge that most managers fail. In an industry where existing and potential competitors innovate consistently, it is prudent for industry leaders to foresee the future. The case of General Motors (GM) is a manifestation of an organization that has consistently failed to merge its internal and external factors to achieve the best outcomes consistently. An insightful analysis of the GM case unearths challenges ranging from generic strategic and growth strategic choices to challenges in operational environment analyses. Addressing GM’s case must stem from understanding the challenges, their scope, and the action/inaction that they attract before making a decision, which would imply a turnaround.
GM has two main challenges that it needs to address with urgency. The first challenge is the strategy. Both the generic and growth strategies that GM pursues are outdated and do not address their challenges. In Porter’s strategy models, multinational organizations must stabilize their growth and generic strategies (Knoedelseder, 2018). GM’S generic strategy was initially differentiation, where it operated in different product lines in different geographic locations. That strategy was vital in addressing markets according to their demands. However, the strategy was only efficient in a stable environment with little competition. GM lost its identity and operational control when its growth strategies failed. In China, for instance, GM used joint ventures as a market penetration strategy. While JVs are vital penetration approaches, they are unsustainable in the long term.
The other challenge that GM must address is financial crisis. An ideal illustration of GM’s loss of market share is evident in the growth between the GM and Toyota brands from 1950 to 2020 in the US market. Within the US, GM enjoyed the benefits of a cluster with the other market leaders and support systems (Knoedelseder, 2018). The environment within the US was controlled until the market opened for competition. GM had a market share of 45.7% in the US, while Toyota had 0% at the same time. In 2020, the US market had a 17% dominance of GM while Toyota commanded 16%. The market loss for GM implies a combination of challenges, including poor market penetration strategies, limited inputs in research and development, and overreliance on the Detroit cluster. The US market represents GM’s strongest segment that it has to restructure before expanding to other markets.
GM should make informed decisions based on the prevalent trends in its downward trajectory. GM struggles with a br...