Founded-1908 Largest company in the world automaker Brands include Chevrolet,pointec,buick,

GMC trucks.

Headquarters - Detroit, Michigan, United States

Company starts facing competition . Sales declines from 60 to 28 %. GM made 70% of its own parts. Inefficient production process, thousands of

outdated legacy

Selling vehicles online -they associated with nada

Building vehicle to order - this will reduce inventory

cost

online services - includes GPS systems

FIVE FACTORS MODELS

RIVALRY AMONG COMPETITORS

BARGANING POWER OF BUYERS

• Local & Global customers take management of cars business.

- wider choice.

- Better quality.

- New technology.

- Cost.

- Reduced delivery time.

NEW ENTRANTS

• EARLIER NEW ENTRANTS ARE: -TATA MOTORS.

-KIA.

- HUNDAI.

- HAIBRID CAR.

• Now There are no space for new entrants.

BARGANING POWER OF SUPPLIERS.

• Alpine Electronics, Inc.

• Barton Malow Company.

• Johnson Controls, Inc. – battery.

• Seyen Alloy Wheel N.A.

• Eaton Corporation.

• Cost of goods.

• Delivery time.

• Quality.

SUBSTITUTE PRODUCTS.

• MOTORCYCLE

• PUBLIC TRANSPORT

VALUE CHAIN

SUPPORT ACTIVITIES: • FIRM INFRASTRUCTURE : - Big infrastructure-50 factories around the wrold.

- I.T. intregrated.

• TECNOLOGY:– GPS=know the position of cars.

– EDS= Web based product life cycle management system.

– OnStar virtual Advisor service-allow to know personal data .

– Onstar personal calling .

SUPPORT ACTIVITIES

• HUMAN RESOURCE: -Online training. - Socrates- Give human resource information. - Integrated Internet technology=for work. • PROCUREMENT: - Just- in-time. - Work-in-progress inventories. - Computerized ordering system.

PRIMARY ACTIVITIES:

• INBOUND LOGISTICS:

- Automated warehousing system.

• OPERATION:

- Computer control machining system.

PRIMARY ACTIVITIES:• OUTBOND LOGISTICS: - Sell through dealers.

• MARKETING:

- Online Marketing & Sales.

GMBuypower.com.

OnStar.com.

OnStars telemetic- give information.

• SERVICE: - After sales service.

[2]Evaluate the current business strategy of GM in response to its

competitive environment ?

Flaws in GM motors

Separate operating division :• CEO ALFRED SLOAN.• Sales from 60% to 28% in 1970.• Stiff competition from ford, daimler chrysler,etc.• Make upto 70% parts.• Competitors outsourced the parts.• Lower production costs.

Styling and quality. Decentralization and top – down control. Inefficient production process. Outdated information technology. • High Inventory costs.• Industry holds 2 months inventory for new vehicles. Not selling the vehicles directly through websites. Shipping & Logistics

What is the role of Internet technology in that strategy?

• In Feb. 2000,RICK WAGONER was appointed as a CEO.

• He focus on :Innovative product ;Service;development of e - business.

• GM become smarter, leaner, faster co. , more in tune with customers.

• With the help of this GM can reduce from 24 to 12 months to manufacture new vehicle and cut cost upto 10%, by eliminating SCM inefficiencies

• In Aug.1999, GM has set up new division called EGM.

• It was headed by MARK HOGAN.

• GM started dismantling EGM in late 2001.

GM rely on internet

• Selling vehicles online.

• Building vehicles online.

• Online service.

• Internal uses.

Selling vehicles online

• Dealers are vital to GM,• They know consumer choice,• How much inventory require to make required vehicles,• Web site – GMBUYPOWER.COM,• It does not sell vehicles directly online but provides service for

both customer & dealers, • Color , options , and availability .

Building vehicles online

• Before build – to – order was there only for expensive cars.• They reduced the delivery period from 2 – 3 months to 6 – 7 weeks but TOYOTA delivers in less than a month.• Build to order has reduced finished vehicle inventory &

generate other production cost savings.• Saved $20 billion per year.• Just – in – time trends.

Online service GM established its wholly owned subsidiary , ONSTAR. A GPS system :• Location of the vehicles,• Stolen vehicles tracking, On star generates high – margin revenue from :E-mail, News,Stock quotes, Traffic & road condition within in a drivers location. GM has given license to TOYOTA & HONDA.

How successful is thatstrategy?

• GM's restructuring and reorganization have provided the corporation with numerous benefits, including reducing the time to produce a car from 48 to 18 months, reducing engineering costs by $1 billion, developing online sales channels and sources of revenue, and improving its quality and quality ranking.

Evaluate each of GM’s E-Commerce & E-Business initiatives described in this case.How much value can they bring the company?E-Commerce E-Business

Buying and selling of goods

Sharing the information

SELLING VEHICLES ONLINE

Customers begin to purchase, selecting fromdealer inventories.

Industry starts maintains about a two-month inventory of new vehicles.

The value of GM's inventory is usually about $40 billion according to Hogan, Making inventory costs very high.

GMBuyPower.Com, establish In 1999, is a Web sitewhere visitors can browse for GM cars : search by

COLOR OPTION AVALIBILITY

Waiting period of 2 to 3 months is reduced to 6 to 7 weeks.

Build-to-order would greatly reduce finished vehicle inventory COST as well as generate other production cost savings, potentially saving GM$20 billion per year.

Reduce the time from receivinga car order on-line to delivery from about 45

days to 10 days because of GM Supply Power

What management ,organization and technological

issues do you think GM had to face and will need to solve in implementing in its internet strategy ?

These websites are used by GM to assist customers in the automobile buying process, not to eliminate the dealers.

www.GMBuyPower.com www.gm-dealerworld.com GMAC Smartauction

GENERAL MOTORS -

They had to become familiar with

new process And programmers

They have the fear that many people might loose their jobs.

Update the information They have to look for

new and competent people.

GENERAL MOTORS

Technology is always evolving which might require GM to establish a department which will keep up new competitive advantages in technology

This leads to greater cost .

TOYOTA MOTORS

Toyota operates a Japanese language web site gazoo.com.

They have appointed an expert who keep the track of all the information prevailing on the net.

GENERAL MOTORS Dealers- dealer

think that to by pass them by selling vehicles on line.

Now they have more pressure build cars in less time.

TOYOTA MOTORS Dealers don’t have

any kind of doubt. They producing the

car with in a less than one month.