Overall performance of the General Motors business.

Requirements

1- Write a report on "systems thinking" with references up to 20-25 within 4000 words.

Solution

Root Definition Report using CATWOE

Introduction

This report is to evaluate the prime reasons for General Motors (an American multinational car manufacturer) to run into a loss through the headquarter. This is even though there was a profit. As a result, the company is now considering options so that it can understand the reasons why the loss had incurred and what could be the solution so that they do not run into any such loss in the future.
To better understand the reasons for the financial hit, the CATWOE concept would be adopted so that the major aspects of the business can be critically examined. This will help to come up with a solution that would not only be practical but fact-based as well. This model is a proven method, and the reason for choosing this is it represents an understanding as per the perspective of the stakeholders. It also represents the impact that the CATWOE analysis outcome will have on the overall performance of the General Motors business.

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CATWOE Analysis

The CATWOE is an acronym. It comprises of six business terms. The letters of the word form the first alphabet of each of those terms. Those terms are:

  • Customers.

  • Actors.

  • Transformation Process.

  • Worldview.

  • Owner.

  • Environmental Constraints. 

Customers:

For any business, to continue doing the business, it is important that they give the highest priority to the customers. In the given scenario, General Motors has incurred a loss, and to generate profits, the company has to focus on more sales, and this can happen only when customers are attracted to the brand (Zhang,Calvo-Amodio&Haapala, 2015). Here are a few things that modern car lovers look for in a particular brand:
According to automobile experts, by the year 2020, almost 40 per cent of the total car buyers will be millennials. Among these, more than 80 percent would rely on the internet to purchase a car. Therefore, it is extremely important for car manufacturers, especially General Motors, to ensure that their online presence is strong enough so that the company can connect well with this new breed of car buyers. At this point, it is also important for GM to evaluate factors that the Millenials would value the most. For example, it must be determined to what extent are the new buyers going to favour environmentally-friendly vehicles (Fathurahman, Huseini&Hardjosoekarto, 2018). Also, what would be the price tag that the young generation would be comfortable with? Therefore, these are the types of queries GM must focus on so that it can have a precise idea of what exactly is going on in the mind of the purchaser.
Another added advantage of such interactions with purchasers can also lead to other valuable information like what people are thinking about the other competitor brands. It must be understood that while sales data would give a picture of how the company has been doing, but it can never reveal why it happened so.

Actors:

The automobile industry is going through a paradigm shift. It is getting into a new phase of evolution and development. For General Motors, it is essential that they selectively choose the people who can achieve the objectives of the company. Given below is the list of the key position holders who must be very dynamic so that the business can run smooth:

  • Chairman of General Motors.

  • Board Of Directors.

  • Vice President of Finance, Human Resource, Network Team, Product Team, and Marketing.

  • Manager of Human Resource, Finance, Network Team, Marketing and Product Team.

  • Executives.

To ensure that purchasers get the best that General Motors can offer, there smooth be a smooth flow of information from the level of the Executives going right up to the Chairman. This will help to keep the people at the ground level and the people at the top management level on the same page (Kholil&Sulistyadi, 2017).
As per the given scenario, there should be more stress on the marketing aspect so that the sales revenue can be properly maintained. This will also help to stay updated on the current trends of the automobile market.

Transformation Process:

General Motors should also keep a close eye on what the implications of the new strategies would be especially at the level of the purchaser. Also, what implications it will have on the other stakeholders should be considered.
Any new change that GM might implement should be thoroughly evaluated so that there is no negative consequence on any other aspect of the business, especially in terms of processes.
To understand the issue that GM is facing, analyzing the implications that had been predicted before might reveal something relevant enough to understand the gap.

Worldview:

This is perhaps the most important aspect specifically applicable to a big brand like General Motors. Being a multinational company, it is extremely important to maintain a good image. Any crisis or issue might be perceived in a very negative way since people have high expectations from brands like GM. Even a small hit on the image would provide the competitors with a chance to market their brand over this company. This can potentially lead to both loss of brand value as well as business. 
The recent crisis had its effect on the company already, and now corrective measures will have to be initiated so that there is no further loss of reputation. Going ahead, GM must carefully consider all possible results before rolling out a new scheme or implementing a new strategy.

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Owners:

Whenever there is any crisis, it must be relatable to a particular person who would assume all responsibility for what has happened. This is decided before the rollout of any initiative or scheme. The other way round, someone must be appointed as the main person who would lead an investigation of an issue and would also recommend the best possible solution.
Regarding the issue that GM is facing, the person responsible for the particular short-coming would be better positioned to explain the situation (Ehrlich, Wisniewski &Jasperneite, 2015). The competitiveness of this person should be re-evaluated to check whether the same person is suitable enough to continue or not.
If needed, there can be changes in the panel of key persons. However, preference should be for existing people in this case since they would have a far deeper understanding as compared to someone new.

Environmental Constraints:

General Motors must evaluate the consequences of its action on the environment both in the case of the crisis that has happened already and what might be the impact in case of future undertakings (Esser&Goodden, 2016).

Conclusion

From the CATWOE analysis of the issue that General Motors is faced with, it can be concluded that the key responsible person should submit a report that should clearly mention the issues. At the same time, a logical recommendation should also be presented so that the situation can be brought under control.

Recommendation

For generating sales and to maintain the brand image, General Motors must give priority to the choice of Millenials like eco-friendly and cost-effective cars.
The key management heads must submit reports periodically so that there is a clear idea of the current situation. This will help a lot to take the precautionary measures (if needed) well in time to avoid any major crisis.

Reference

  • Zhang, H., Calvo-Amodio, J., &Haapala, K. R. (2015). Establishing foundational concepts for sustainable manufacturing systems assessment through systems thinking. International Journal of Strategic Engineering Asset Management, 2(3), 249-269.

  • Fathurahman, H., Huseini, M., &Hardjosoekarto, S. (2018). Developing Competitiveness at Cimahi Telematics Creative Industry Based on Relational Economy. KnE Social Sciences, 291-309.

  • Kholil, N. S., &Sulistyadi, Y. (2017). The best strategy for ensuring the sustainability of Bunaken National Park, North Sulawesi Indonesia. J Tour HospManagem, 5, 78-85.

  • Ehrlich, M., Wisniewski, L., &Jasperneite, J. (2015). Usage of Retrofitting for Migration of Industrial Production Lines to Industry 4.0. JahreskolloquiumKommunikation in der Automation (KommA).

  • Esser, K. A. G., &Goodden, T. (2016). Development of Business Models for Electrical Energy Storage in Europe-Techno-economic evaluation of combining storage services.

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