The case study will be talking about the case that happened in General motor company (GM). But first let me give you a brief introduction of the company itself.
General motor was famous for being a vehicle manufacturer and has been in this business for almost 100 years. The founder of General Motor was Mr. William C. Durant in 1902. As the business was very successful in both United States and Canada. It started to expand the business to the foreign markets and began to export the vehicles which made it become one of the largest companies in the USA and in the international level. However, everything has its ups and downs, the company had declared a bankruptcy in 2009. To help save the company, the US government has invested on the company for $49.5 billion. After all the downward, Mrs. Mary T. Barra was appointed to be a new Chairman and CEO of the company.
Currently, the headquarter was in Detroit, Michigan, United states. Back in year 2014, the thing that had happened was a recalled of nearly 16 million cars worldwide that had caused them $1.7 billion dollar to make all those repairs. The problem of the recall was the faulty of the ignition switch that make a car lost the power while driving, disabling the airbags, power steering and anti-lock brakes. This disaster has led to some deaths. We can see that all the problems above do really happened not because of the safety itself but also the culture within General motor. They have had known the problem starting from the beginning by some of the stuffs but failed to speak up to take immediate actions to solve the problems. There are many issues that happened within the General Motor’s society especially the old mindset that think they stick to and being unbreakable through many experiences.
The failure of the employee adaption to the new culture, human nature likes doing things that is familiar to them which made them feel comfortable. If things go the other way around, there will be complaints because it feels like a threat. Some companies have failed and stuck in the loop like KODAK who declared bankruptcy in 2012.
For GM, there are 2 cultural crisis that I would like to illustrate. Firstly, The GM Nod described as a plan that was agreed by everyone in the room but after the door opened no one’s seem to really care or do anything according to the plan. This is one of the disasters that can harm the company in many other ways. Plan was made to test or try. If this was not put into action, how can the company have adapted to the fast-moving world. Secondly, Nod and Conflicting messages from the Top management is really a big flaw. Considering the cost is irrelevant for safety which is very wrong. It was reported that the engineers had approved for the redesign but got canceled since they are going spend more money on the products that had been released to the market. Instead of facing the truth about the failure of the ignition switch, they recommended the customer not to use the heavy key chains that can possibly pull out the key while driving.
The solutions were made after Mrs. Mary Barra being appointed. Many changes were made during that time and she even fired 15 of her colleagues. Her solutions to the problem was to focus on the customers and being transparent. Moreover, they have created the new value for the company to focus on the customer and to have strong relationship both inside and outside company so that it can lead to perfection. It was vitally important as it strengthen the value of the company. She added to become a leader you need to have a strong vision but if you have not won the heart and mind of your team. You will not be far because they are not with you. She has taken some measures and provided many solutions such as recall back the small cars that had problem. Thus, she encouraged her stuffs to speak up and gave suggestions to demolish the barrier between management team and employees. Particularly, she even makes a compensation for the victims. In conclusion, it is very challenging for her but after the bad times, the company started to be on track now.