Impact of Globalization on General Motors Essay

Impact of Globalization on General Motors - Essay Example These include simplifying the process where possible, finding cheaper but high quality material to help with the manufacturing process (Reader 2006, p.7). Additionally the company believes that innovative technology will help it attain better production hence increasing output but the question is how globalisation in the automotive industry affects GM. Globalisation is a double-edged sword that cuts both ways in this case it has both the positive and the negative impact on any industry. However, the degree of managing these effects determines the success or failure of a company in a particular industry. When examining the effects of globalisation in a company for instance GM, we have to look at all the department, branches, plants and any subsidiaries of the company. The reason for this is that globalisation is a multifaceted phenomenon. For instance, we have to look at how globalisation has affected GM employees, the production process, the marketing aspect, the information technolo gy aspect and the management aspect (Alias 2008, p.10). The complexity of the automotive industry demands that the company should effectively deal with the impact of globalisation because if the competitors are able to deal with it more effectively than the GM then this can be catastrophic or detrimental to both the company image and the market. The world is moving towards becoming a global village hence having a very fast rate of globalisation. As a result, companies should strategise and gear up for this cause to avoid eradication due to drastic changes. However, in dealing with the effects of globalisation on the GM it is important to separate all the sections and critically examining them individually ratherthat having a... The paper tells that increased globalisation has led to increased competition in the automotive industry with registration of new entrants who have better ways of manufacturing and production of vehicles. However, one of the biggest competitors to GM is the Japanese company Toyota manufacturing durable and affordable vehicles. Additionally, due to the persistent hard economic times more and more people are opting to buy fuel-efficient vehicle and vehicles whose spare parts are easily available. The Toyota Company has managed to tap into this market both locally and globally hence giving GM very stiff competition. Additionally, due to globalisation vehicles are becoming cheaper hence reducing the profit margin of GM. Because of this, it forces the company to seek ways of cutting down costs in order to increase the profit margin because they cannot increase the prices due to the demand and supply forces of the market. Globalisation has also made information readily available to consume rs in the market. Additionally, the introduction of ecommerce solution has also cut down on the cost of business transactions. Customers are now able to purchase vehicles from another counter through the internet and go through all the relevant processes that will enable him or her get the vehicle at his or her disposal. GM has to deal with these globalisation effects in order to stay afloat in business. The distance between countries is closing up very fast due to the development of efficient ways of transportation and business transactions are becoming easier due to the technological development.