General MotorsPresented by-

Reena dewanganShiladitya sen

guptaRashmi nidhi sahu

Prahlad SahuShashi Bhagat

Pratiksha dewangan

SIMER

Grand strategy for GM

Introduction– Grand strategies , often called master or business

strategies, is an extension of the existing BCG matrix which helps determine the strategies which can be adopted for a particular set of situations and provide basic direction for strategic actions

– Indicate the time period over which long-range objectives are to be achieved

– Firms involved with multiple industries, businesses, product lines, or customer groups usually combine several grand strategies

– Any one of these strategies could serve as the basis for achieving the major long-term objectives of a single firm

Four Alternatives• Stability

• To remain in the same size or• To grow slowly and in a controlled fashion

• Growth• Internal growth: can include development of new or changed products• External growth: typically involves diversification – businesses related to

current product lines or into new areas

• Combination -It involves deliberate use of different strategies for different units or divisions at the same time or chronological use of different strategies over the period of time.

• Retrenchment -The organization goes through a period of forced decline by either shrinking current business units or selling off or liquidating entire businesses.

Fig. 8-5: Model of Grand Strategy Clusters

Rapid Market Growth

Slow Market Growth

Market Development Market Penetration Product Development Horizontal Integration Divestiture Liquidation

Retrenchment Concentric Diversification Horizontal Diversification Conglomerate Diversification Divestiture Liquidation

Market Development Market Penetration Product Development Forward Integration Backward Integration Horizontal Integration Concentric Diversification

Concentric Diversification Horizontal Diversification Conglomerate Diversification Joint Ventures

Strong Competitive Position

Weak Competitive Position

I II

IIIIV

• MARKET PENETRATIONThe main task here is to increase sales by encouraging wider usage of existing products by existing customers --for example, this could be achieved in the market for sunglasses by promoting the product as a fashion accessory, or by formulating an extra-mild shampoo with the directive to consumers to wash their hair every day.

• MARKET DEVELOPMENTThe entering of new markets could involve expansion into new geographic areas, both local and foreign, a shift from consumer to industrial markets or, possibly, marketing the product or service to new segments or demographic groups.Ex: Hallmark cards, who regard themselves as being in the "social greetings business". A casual glance at their product range demonstrates a large variety of circumstances in which a card could be purchased, e.g. secretaries' day, pets' day, and congratulations on your divorce!

• PRODUCT DEVELOPMENTThis is sometimes referred to as a continuous innovation strategy, the intention of which is to protect or develop market share by the use of product modifications and enhancement.Ex: Sony Corporation who market dozens of models of the Walkman, ranging from "My First Walkman" for children which is a brightly coloured, easy-to-use, fun model, to the "Professional Walkman", which sports numerous features that reflect the technical wizardry of the manufacturer.

DIVERSIFICATION

• Diversification has the primary objective of reducing risk by moving into new areas that afford good growth opportunities, better profit prospects and greater levels of certainty. Such a strategy is commonly adopted in a "cash cow" situation when there is reason to believe that the golden days of profitability are gone for good.

• PRODUCT/ CONCENTRIC DIVERSIFICATIONProduct diversification may sometimes be referred to as concentric diversification. This requires a firm to develop, or acquire, new products which have market or technological synergies with current products. These products may, or may not, be intended for sale to the company's present markets.

• HORIZONTAL DIVERSIFICATIONThe firm adds new products that could appeal to existing clients, e.g. a producer of sunglasses distributing tanning lotion

• CONGLOMERATE DIVERSIFICATIONThe adding of products or businesses that have no relation to current technologies, products or markets. The Mitsubishi Corporation manufactures an immense range of products, ranging from disposable ballpoint pens to bulk carriers.

INTEGRATION• Commonly confused with diversification, integration relates more precisely to

the vertical aspects of manufacturing and distribution logistics.

• BACKWARD INTEGRATIONIf a company were to undertake a strategy of backward integration, investment would result in the acquisition of vendors--for example, 7-Up purchasing their flavour supplier.

• FORWARD INTEGRATIONThis strategy usually involves the movement into logistical, distributive, or retailing activities.

• HORIZONTAL INTEGRATIONA pure form of growth, horizontal integration encourages ownership or control of other firms in the industryEx: Ford's acquisition of Jaguar, and Fiat's acquisition of Ferrari.

RETRENCHMENT

Retrenchment is a common strategic response in markers that are subject to adverse economic pressures, uncertainty, or cheap foreign competition. Retrenchment can be differentiated from divestment, in that the former is a reaction to temporary hardships whereas divestment has the element of permanency about it.

Cadillac

Internal & External Analysis

Strengths -Extensive cash reserves-Global network of suppliers and distributors-Economies of scale and scope-Quality improvements-Low cost suppliers through competitive bidding process-Technological know-how for SUVs-Only company to have invested in all 5 alternative fuel technologies-Developed internet distribution channels

Weaknesses -Legacy costs/unionized labour force-Brands require large investments to maintain equity and are a barrier to innovative thinking-Poor corporate reputation for green technology-Customer perception of low quality-Bureaucratic processes create delays-Fixed investment in SUV production-Inadequate experience in smaller vehicle production

Opportunities -Increasing demand for smaller cars and CUVs-Emerging world markets-Reduce costs through JIT-Demand for environmentally friendly cars-Government subsidies-Increasing public awareness of green technology

Threats-Economy fluctuations affect sales-Increasing regulations on CO2 emissions and recyclable parts-Decreasing demand for SUVs-Increasing oil prices-Rise in commodity prices

Launched On Model Rate (Rs. In Lakhs)

Competitor

2003 Chevrolet Optra 7.81-10.29Honda Civic,Skoda Octavia,

Maruti Verna

2004 Chevrolet Tavera 7.66-9.4Toyota Innova,Tata Safari,

Mahindra Scorpio

2006 Chevrolet Aveo 5.99-7.05Honda City,

Maruti Swift Dzire, Ford Fiesta

2006 Chevrolet Aveo U-va 3.8-4.25Maruti Swift,

Skoda Fabia, Hyundai I20

2007 Chevrolet Spark 3.09-3.70Maruti WagonR, Tata Indica,

Maruti WagonR

2008 Chevrolet Captiva 17.40-19.22Ford Endeavour, Honda CR-V,

Mitsubishi Pajero,outlander.

2009 Chevrolet Cruze 10.93-12.56Honda Civic,

Skoda Octavia, Skoda Laura

2010 Chevrolet Beat 3.42-4.03Maruti Ritz, Fiat Grand Punto,

Hyundai i10,i20

GM India Product launches

MODEL TYPE

Chevrolet Spark Small Size

Chevrolet Beat Small Size

Chevrolet U-VA Small Size

Chevrolet Optra Mid Size

Chevrolet-Aveo Mid Size

Opel Corsa Mid Size

Opel Astra Mid Size

Chevrolet Tavera SUV

Chevrolet Tavera Neo SUV

Chevrolet Captiva SUV

Product Positioning

Optra Magnum

Cruze Altis Civic Octavia Cedila Linea Verna

Price Range 7.81-10.29 10.93 to 12.56

11.76-13,93 12.18-13.45 12.34 – 14.91

8.96 -11.09 6.36-8.62 7.70-9.04

Units Sold 5,025* 12,500 14,000 12,700 -NA- 2000 11,300

Aveo Logan Fiesta SX4 Dzire City

Price Range 5.99-7.05 4.90-6.92 6.66-9.04 6.85-8.55 4.86-6.98 7.71-8.95

Units Sold 5,025 * 23,465 -NA- 2,09,000 14,400

Beat Spark Wagon R A-Star Alto Estillo Santro I10

Price Range 3.42- 4.03 3.09- 3.70 3.23-4.45 3.55-4.23 2.31-2.96 3.21-4.11 3.57-3.76 3.61-4.46

Units sold 62,700 4,38,000 3,52,000

U-VA Swift Ritz Grande Punto

Vista I20 Fabia

Price Range App 4.00 4.17-5.40 4.01-4.95 4.27-6.43 3.72-4.53 5.27-6.13 5.11-7.32

Units sold 5,096 2,17,409 -NA- 51,500 73,000 -NA-

Neo 2/Old Tavera

Innova Sumo Grande

Safari Scorpio Xylo

Price Range 7.66-9.40 8.75-12.39 5.29 – 7.25 7.51 - 11.92 5.15 -9.50 7.64 8.75

Units Sold 22,474 28,600 37,500 1,10,000

GM India Product Line Up

• Cars• Trucks

• SUVs• Hummer

Star Question Mark

DogCash Cow

foreign brands such as Holden, Vauxhall, and Opel, and full-size trucks and SUVs due to their large consumption of expensive fuel. 

Hybrid vehicles such as the 2006 Chevy truck, and smaller SUVs and crossover vehicles such as the current Pontiac Vibe.

3 pillars to create high impact and recognition for brands:

1. Integrations and Innovations 2. Strategic Partnerships 3. Sustenance and Continuity

Marketing strategy of GMI

Thank you