Question

No copy-paste, please

Change Management at General Motor (Gm)

Scenario

General motor established in 1908. that time the company was the sole carmaker dealer in the region, e.g. Michigan, first it was a holding Buick company, till 1920 it was becoming the world largest motor manufacturing company, the company got tremendous success in time of Alfred salon, due to his leadership the company was producing new style and design car every year, and he had given such concept to the company. The other brand of the company is Chevrolet, Pontiac, Buick, and Cadillac. These were the different brand cars which were producing by company that time, and this way there were no other competitors to compete in the company different cars. But with emerging of the japans automakers the company felt threatened, specially the emerging of Toyota Japan, who with a great extent disturbed the profitability of the GM, especially in the North American market. In 2001 the sale graph of the GM was in declined trend, because Toyota had captured the market, this way the GM received loan form American government and Canadian government to support the company in that crises period. During 2009 the company had faced bankruptcy and had closed several brand and sold out to china based companies. Now the company again got his position in market by restructuring and making change in the company. Now the company is again operating business in the core brands in America such as Chevrolet, GMC, Buick, and Cadillac.

Q1. How can we use different approaches elaborate and bring to light the core concept of the organization change, what are diverse factors which move the organization to change, steps for change, resistance for change, change forces, change management approaches, explain that.

Q2. According to the lewins model, the organization must follow three steps for successful change management, Discuss the steps with the above scenario

Q3. In the present scenario when the expert specialist decides about all the situation and preparing for changing the organization it leads to the concept of organizational change or change management, the question arises that how will change the organization, evaluate the cost of proposed change

Answer 1

Q1. How can we use different approaches elaborate and bring to light the core concept of the organization change, what are diverse factors which move the organization to change, steps for change, resistance for change, change forces, change management approaches, explain that.

Answer: No doubt, the General Motors (GM) was performing well during 1908 t0 1920. But main issue happened with them because they were having monopolism. The manufacturing lead time was not dropped down significantly even in 5 years. The potential reason was not being innovative to for market growth. The other reason was not having costumer focused strategy. Change is necessary and it is for good. Because of the satisfactory market and no competiveness, GM was not investing much in the business growth even they were very innovative in the technology. The need was to improve the manufacturing technology to fulfill the market need. While Toyota was very aggressive and having a innovative thinking to fulfill the demand. They changed themselves adopting JIT, 5S, DEMNG’s approach, Value steam mapping, Six Sigma and many technology. As per the study, the delivery time of Toyota was 10 times faster than GM and 5 times faster than Ford. Relating to scenario, below are the different approaches to light the core concept of organization change,

Defining Mission and Vision: Organization should define where they want to see themselves in coming years. Organization should figure out the costumer need and how they can serve better to fulfill those needs. Toyota used Kanban and Effort-impact matrices to define the Mission and Vision.

Strategy formulation: Based on the Mission and Vision, the Strategies shall be defined for organization. While fixing strategies, the present situation/ condition shall be evaluated. The changes need to achieve the mission shall be formularized and implemented.

Continues Improvement: Better in the best. The improvement areas shall be identified with the FMEA (failure mode effect analysis), quality trend, price, services, products etc.

Competitive advantage: Change should focused on how organization can gain the competitive advantage in the market. This happens when the organization have frequent market surveys, situational analysis, change in costumer taste and being a one point solution for many needs.

High performance culture: The expectation is high. The high performance culture is kind of change where the expectation from employees are very high in terms of quality work, business growth plan, innovations. This culture brings more operational discipline and clarity on organization’s plan to win.

Supportive leadership: This is different than the “only leadership”. The supportive leadership is kind of appeal for team work. Top management should be called them as top leadership. This is because of the basic difference between manager and leader.

Innovation and invention: The R&D investment shall be done to achieve comparative growth. The probable innovation shall be around New products, new way of manufacturing, new technologies etc.

Q2. According to the lewins model, the organization must follow three steps for successful change management, Discuss the steps with the above scenario.

Step-1-Unfreeze: According to Lewin’s law, the change shall be determined or created to keep upgraded organization by understating the concerns. Because of the “Explicit leader” of the market, GM was not much interested to change themselves with costumer demand while Toyota was costumer focused. They both were good in innovation but Toyota was working productive.

Step-2-Change: Based on the outcome (required changes) of step “Unfreeze”, the strategies shall be developed and implemented. The biggest change Toyota has done was JIT (Just in Time) manufacturing concept. Toyota has made the robotic lines flexible to adopt many model and variant. While GM was taking much time if they want to change the manufacturing line for other model (car model). Because of this Toyota was much faster in deliverables.

Step-3-Refreeze: The refreeze is kind of control on the current process or status. The changes done during Step-2 shall be evaluated in order to have continues improvement. GM was not much qualified for this step. They have done this for product improvement but they were not effective to do this for process improvement. While Toyota was continuously seeking for the change in process as well as product.

Q3. In the present scenario when the expert specialist decides about all the situation and preparing for changing the organization it leads to the concept of organizational change or change management, the question arises that how will change the organization, evaluate the cost of proposed change.

Cost of Quality: The investment on quality assurance (QA) will cost for the change. The aim will be “prevention before detection”. Many steps will need to be identified for converting them in Auto mode (systematic). In Automobile sector, the present cost is 5% of total operation cost.

Cost of innovation and invention: The process and product development cost have significant effect on organization. This shall be treated as cost of change.

Survey Cost: Market survey shall be done to identify the change and costumer’s expectation.

Infrastructure cost: The desired need in infrastructure will be having cost impact and it should be evaluated. The re-alignment of machines according to desired changes must be a cost of change.

Training cost: Cost of skill improvement and training shall be calculated with reference to short term and long term outcomes.

Influence cost: The changes shall be influenced in all employee. This will need several conversations with them. The employee will have to attend these session in production time.