General Motors

 

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Objectives

General motors has been a driving force in the economy since its creation in 1908. By researching General Motors, a successful organisation not just in the united states but globally. I understood that the company has a firm stance on ethics and contributes to the social economic situations in countries the organisation operates in.

I chose general motors as they are a large global organisation. One factor that interests me specifically is that the General Motors board is comprised of 55% woman. (Stanisic. 2018) The company is the only vehicle manufacturing organisation which has a majority female board. I would like to determine if this influences the organisations decision making. In 2020 general motors was named as one of the world’s most ethical companies due to their revised vision statement announced in 2017. The organisation has committed to a zero emissions future. (Leader. 2018)

Introduction

William C Durant is the mastermind that consolidated a number of car manufactures. Producing vehicles like Buick, Oldsmobile, Cadillac, Oakland/Pontiac to name a few. The company was the world’s largest vehicle manufacturing for most of the 20th and 21st centuries. The company’s primary products are cars and trucks, automotive components, and financial services. By 1914 the company was producing 44% of all new cars sold in the United States. The company changes with the times and this is demonstrated by the vision statement the organisation released in 2017.

General motors has pledged to be emissions free and a hundred percent electric in the future. The ethics they demonstrate is the preservation of the environment and fighting co2 emissions. (Sortello. 2019) The vision statement is “to create a future with zero crashes, zero emissions and zero congestion. We have committed ourselves to leading the way toward this future”. (Grey. 2020). Like any large corporation GM has faced a number of obstacles that has forced them to change. For example, Durant being forced out of the organisation in 1920.  Or GM receiving a bailout from the Bush administration due to the economic down turn and the foreign vehicle manufactures encroaching on GMs market share in the United States.

Code of ethics

General motors code of conduct, orientation, and direction states that the organisation will win with integrity, conduct business practices with honesty. They further state they are committed to core values, customers, relationships, and excellence. (Danigelis. 2018) GM has pledged to always act with integrity and put the safety of its workers and customers as its number one priority. This is due primarily to the backlash GM faced in the past. The company covered up defective parts.

It is presumed that the cover up lasted almost ten years and is responsible for more than 120 deaths. (Sarhello, 2017). GM places transparency as paramount. (Okne. 2020) GM’s perspective is that if they maintain their code of ethics and work hard to improve the safety of their vehicles, they can be more successful. Primarily GM stands for the safety of its stakeholders.

These would include their employees, investors, and CEO internally. External stakeholders are vendors, consumers, clients, competitors, and the governments of the countries they operate in. (Khatter,2017).  In my opinion GM is both value and compliance based. The company has to comply with a number of rules and regulations in order to operate in the United States. By complying with these regulations, they transition into being a value-based organisation giving their consumers the best possible products. (Barra, 2019).

Corporate social responsibility

GM has a corporate social responsibility strategy that supports business growth objectives in the global automotive industry. The strategy is based on stakeholder interests in the manufacture sale and use of their vehicles. GM rates their priorities as employees, customers, communities, suppliers and lastly investors.

GMs social responsibility is demonstrated by the company producing personal safety screens in light of the coronavirus epidemic. And in 3rd world countries engineering staff have been repairing ventilators to aid the communities they operate in. (Green, 2019).

The new revised social policies were implemented after one of the biggest issues GM had to overcome. The ignition switch scandal in 2014. It was revealed that some cars featured faulty ignitions, resulting in the engines being switched off. GM covered up the fault for a decade. It is believed the fault resulted in more than 120 deaths.

After it was exposed by the media GM recalled 2.6 million cars. It is theorised that cost was the reason for the cover up. GM was investigated by congress and the federal government. CEO Mary Barra took over during the controversy and pledged that the organisation would go from a cost culture to a customer culture. (Barra. 2015)

Diversity and technology

GM believes that different cultures shape today’s global economy. “We believe that working on inclusion will strengthen our understanding of customer needs and help us solve todays toughest transportation challenges.” (Wang. 2015) GM strives on bringing together diverse teams so the organisation can have multiple perspectives. GM gas achieved this by having a workforce that is comprised of 40% woman and minorities. The organisation is one of the only companies in manufacturing that has a board made up of 55% woman. (Okne. 2020)

Marketing

GM’s social agenda is partnering with lifestyle brands. Partnering with these unique brands substantiate that GM products are premium products. Additionally, GM has appointed internal acquisition teams to reach out to prospective employees. GM offer unique made for employee value propositions and partner with universities to recruit the best possible candidates. (GM, Diversity. 2020) The organisation partners with a personal finance company to help restructure employees student loans.

When considering the four Ps GM has a multi layered approach. This approach allows the organisation to tailor product offerings to regional needs and desires of the communities they to serve. (Rosen. 2018) Because the strategy is tailored to specific regions and markets the strategy is sustainable and the organisation can create its own unique opportunities.

In their vision statement GM highlights that the opportunities the organisation aims for is the development of new technologies, cleaner running cars and moving towards zero emissions. These new technologies will increase the safety and ease the everyday headaches of consumers. (Gregg. 2018)

Environmental responsibility

The organisation made a promise when Mary Barra took over in 2014. GM was going to be a responsible corporate citizen with a global environmental policy to help manage the impact of their carbon footprint has on the environment. For example, GM has pledged to reduce the organisations waste by committing to reduce waste and pollutants while conserving resources and recycling materials. (Rosen. 2018).

The code of conduct spells out what the organisation is doing to reduce waste, save water and recycle. GM is extremely focused on developing energy efficient cars which is a sustainable marketing practices which can be turned into a business opportunities. (Green. 2019)

GM has a combination of a regulatory approach and market-based approach. The American government has extremely strict rules and regulations in regard to manufacturing and selling vehicles in the United States. This would be the regulatory approach the market-based approach is where GM considers the benefits and features and prices of the competitions products. GM needs to have a market-based approach if they want to be competitive. (Wang. 2015).

Corporate governance

The companies ethics affects its governance we circle back to the GM mission statement. “seeing a world with zero crashes, zero emissions and zero congestion; our core values are our customers, excellence, relationships and truth; and our seven core behaviours, think customer, innovate now and look ahead.”  Mary Barra has from the start emphasized that the organisation will be people based under her leadership focusing on the safety and wellbeing of the employees and consumers. (Gregg. 2018).

The governance of the organisations completely depends on how the decisions will affect the stake holders positively or negatively. The board of directors has almost absolute power when it comes to the governance of the organisation. They oversea standing committees that look after audits, finance, governance, and corporate responsibility etc. As for conflicts of interests the organisation produces different brands of vehicles, these vehicles all have different brands, but similar models might compete against each other in the market. For example, the Chevrolet Trax and the Buick encore.  (Alberta, 2020).

A prime example of a company that is not effectively managed is AB InBev. The organisation is one of the largest beer producers in the world. The brewery has acquired a number of breweries around the world in an attempt to grow its market share quickly. But due to growing too fast and the mis management AB InBev had to liquidate all its assets in Australia. The same is happening in south Africa were trainees are appointed as managers to save money and the organisation is losing money due to lack of experience. (Grant. 2019)

Conclusion

Yes, GM is a company I would work for as they seem to value their staff and go to great lengths to make sure they are comfortable, happy, and taken care of.  I also completely agree with the policies Mary Barra has put in place making GM a more caring and compassionate organisation. For example, after the scandal of 2014 broke it was with the leadership of Mary Barra that millions of dollars was set aside to compensate families for loved ones lost. But what makes GM an attractive employer is their policies ranging from looking after their stakeholders to the relationship the company has with the environment. These are all brought together in the mission and vision statements of the organisation. Rather than other large global organisations that make statements but act to the contrary GM practices what it preaches. Constantly doing research. Asking questions and finding means in which to improve. (Porta, 2010)

 

 

 

 

 

 

References.

Barra, M. (2019). General motors. A message from our chairman and chief executive officer retrieved from investor.com/static-files/265a1dco-

Britannica contributors. (2017). General motors and competition retrieved from britanica.com/topic/general-motors-corporation.

Danigelis, A. (2018). General motors social and environmental issues inseparable retrieved from environmental leader.com/2018/05/general-motors-social/

Green, J. (2019). Mary Barra will lead the auto industry’s first majority female board retrieved from Bloomberg.com/news/articles/2019-04-18/gm.s.barra-barra-to-lead

Gregg, T. (2018). GM builds winning culture with diversity retrieved from diversity.com/gm-builds-winning-culture-with-diversity/

Grey, S. (2020). Business.com/articles/6-lessons-in-corporate-ethics-from-the-gm-recall

Hult, T. (2010). Stakeholder marketing: a definition and conceptual framework retrieved from danielsethics.mgt.unm.edu-pdf/hult%20and%20ferrolpdf

Khatter, J. (2017). The real reason GM has given up on the Indian consumer retrieved from economictimes.indiantimes.com/why-general-motors-has-given-up

Leader, E. (2018). How GM ties daily sustainability to biz value retrieved from environmental leader.com/2018/03/how-gm-ties-daily-sustainability

Okne, S. (2020). How GM and Ford switched out pickup trucks for breathing machines retrieved from the verge.com/2020/04/212222222219/general-motors-vhecile-ventilators.

Plumer, B. (2015). The GM recall scandal of 2014 retrieved from vox.com/2014/10/03/18073485/gm-car-recall

Porta, M. (2010). How to define your target market retrieved from inc.com/guides/2010/06/defining-your-target-market.html.

Rosen, M. (2018). General motors: achieving and maintaining world-class leadership in worker health and safety in the automotive industry retrieved from researchgate.net/publication/228593355-general-motors-achieving

Sarhello, A. (2017). General motors, mission statement analysis and vision retrieved from astrogrowth.com/blog/generalmotors-mission-statement

Sortello, A. (2019). General motors mission statement analyses retrieved from astrogrowth.com/general-motors-mission-vision-statements/

Stanisic, B (2018). General motors CEO Mary Barra – leadership style analysis individual assignment – critical essay retrieved from researchgate.net/publication/392316366-generalmotors.

Reynolds, K. (2019).13 benefits and challenges of cultural diversity in the workplace retrieved from hult.edu/benefits-challenges-cultural-diversity-workplace/

Wong, W. (2015). Top ten sustainability initiatives of general motors retrieved from clean techies.com/2012/02/02/top-ten-sustainability-initiatives-of-general-motors/

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