How External Environments Impact Management Decisions

Introduction

General Motors (GM) is the leading car manufacturing company in the world. It is a USA based company which came into being in 1908. GM is the world's largest automobile manufacturer. General Motors has over 266,000 employees around the world. It has its manufacturing's operations in 35 countries.

Discussion

Environmental Analysis of General Motors

GM was confronted with the “perfect storm.”The Global economy, inflation, rising prices of fuel, internal and external environment destroyed the market of the automobile industry. In respect to triumph over these possible threats, GM be supposed to regard as mass manufacturing an assortment of substitute fueled vehicles, i.e. fuel cell, electric, and hybrid.

Competitive analysis of General Motors

GM should understand its competition, but should not be focused on how to be like Toyota, Honda, or some other auto company. GM will require focusing on up-and-coming marketplaces that will keep on driving revenues and market share. Markets like China, India, and Russia offer noteworthy opportunities to grow.

Strategic Imperatives by the Manager

In respect to triumph over these possible threats, GM be supposed to regard as mass manufacturing an assortment of substitute fueled vehicles, i.e. fuel cell, electric, and hybrid. As up-and-coming marketplaces expand they will increase their make use of oil products generating yet superior demand and increased prices. Couple this issue with social and political concerns concerning global warming, and the ever increasing state regulations regarding production, will create a potential huge customer demand for these alternative vehicles (Sengir pp. 541-59). By developing and producing alternative vehicles, GM can begin to eliminate brands and platforms that are not selling. GM can use the cost savings to further invest in the development and production of alternative vehicles (Sastry, pp. 237-75).

Affect On General Motors

The biggest factors driving the automotive industry today are the economy, price of oil, technology, and competition. The economy is always a leading factor in the automotive industry. In a good economy, people are less likely to save and make more big purchases like automobiles. Yet in a bad economy people get scared and worry more about retirements and saving funds thus, are less likely to purchase automobiles. The second driving factor is the price of oil. Cars run on oil, and when the prices go up there tends to be a decrease in travel which will affect the car industry. Technology is also a driving force. GM was the first to introduce the electric car in 1998, but there was not enough demand for electric cars at this point and GM took a loss. They are currently working on a car that can run on batteries for 40 miles and then be plugged into a house hold socket for recharging over night. Lastly competition with the technology improving and the transportation overseas becoming easier GM does not only have to take into consideration the competition here in America it has to worry about the competition worldwide. In the past, GM took steps to remain competitive an example of this would be they developed Saturn which ...