General Motors is an American multinational automaker that is based in Detroit Michigan, which currently employs 284,000 dispersed across every major region of the world to facilitate its sales and services businesses in approximately 200 countries, according to Management Paradise Network (2011) and Knudson (2012).
The company produces cars and trucks in 50 countries but sells them through its Buick, Cadillac, Opel, GMC, Vauxhall, and Holden divisions as it strives to overcome challenges in staff turnover/retention, staff satisfaction, staff diversity, professional development hours achieved and experience (Management Paradise, 2011, Knudson, 2012).
General Motors Vice President for Global Human Resources, according to Knudson ( 2012), job description more specifically describes the challenges facing the company, in that she has responsibility for ensuring the delivery of appropriate global compensation, adequately providing staff benefits, managing cooperate governance, maintaining security, effecting change management, supplying medical care, and learning for the entire organization.
General Motors Major Legal Concern
Currently, one of the biggest challenges facing the organization is that of protecting its investment relationship with China, while at the same time be able to prevent two Chinese companies from successfully acquiring Saab- the Swedish brand it had cut loose in 2010, according to the New York Times (2011).
Strategically, GM has been supplying components and technology to the SAAB manufacturing facility in Mexico, to produce SAAB 9-48, and by approving Swedish Automobile sale of the near bankrupt company along with its patents to Zhejiang Youngman Lotus Automobile and Pang Automobile Trade for the agreed market value of $140 m, the company would be jeopardizing its largest market in China, as well as other markets in the world (New York Times, 2011).
By use its legal authority to block the sale of the company, GM had utilized the right strategy and it should allow it to remain in place for the foreseeable future. The company legal spokesman James Caan succinctly made the point for all to understand, when he invoked that GM will oppose the sale unless it becomes satisfied that it will not negatively impact the company’s existing relationship with China, or negatively affect GM interest worldwide.
A decision in the opposite direction would result in GM automatically relinquishing its hold on both the relevant technologies and patents on the SAAB 9- 48 brand, which the Chinese government may exploit to the maximum, before eventually driving this major competitor out of their local markets as well as other markets, because it will then have greater competitive advantage.
In terms of human resources and staff retention in particular, GM , by invoking its legal injunction to block the sale transaction, was also protecting the jobs of perhaps thousands of its well trained employees, many of whom may even be re-employed by its competitor and enable further inroads to be made into its global market share.
Human Resource Strategies for the International Market
According to Knudson (2012), the current business strategy of General Motors is structured around four high level business priorities, namely seeking a major structural overall to curb cost, strongly concentrating on the emerging markets, accelerating integration across the world , and focusing on advancing propulsion technologies, which relates to how company manufactured vehicles are powered.
In order to achieve these goals, General Motors Global Human Resource Division has to play a central role, especially in Asia and Latin America, and this entails focusing on making sure that the right people practices are in place on the grounds, capabilities are built to capture markets successfully, and technologies and other resources are innovatively and strategically applied (Knudson, 2012).
/Human Resource Strategic Recommendations for the Competitive Environment
The human capital has grown in importance Grant (1996) writes, and this was because knowledge has become a critical ingredient to gain competitive advantage, especially in the new economy landscape. General Motors should be encouraged to leverage its vast human resource capital, in order to come out on top in this highly competitive market, and it can do so by establishing partnerships with all colleges and universities that operates in close proximity to its plants and service facilities globally.
This would ensure that employees worldwide are give the same levels of training throughout its organization at the same time, and according to Hitt, Bierman, Shimizu & Kochhar (2000), as partners acquire knowledge that are largely tacit and firm specific, and builds social capital; the human capital will begin to deliver higher quality services to customer, and this will in turn significantly contribute to companies increasing their
performance, productivity, job satisfaction and staff morale levels, while decreasing the attrition rates at the same time.
GM, should it embrace this recommendation going forward, would be well served on the global market, and remain extremely competitive on all fronts, especially in terms of constantly utilizing highly trained and motivated personnel to develop and implement innovative technologies that will help to significantly reduce rising costs in all vital operational areas.
Grant, R.M., (1996). Toward a knowledge-based theory of the firm Strategic Management Journal Vol.19 (Special Issue) pp. 109-122
Hitt, M.A., Bierman, L., Shimizu, K., & Kochhar, R., (2000). Directing and moderating human capital human capital on strategy and performance in professional service firms: A resource based perspective Extracted from www.aom.pace.edu/amj/february2001/hitt.pdf , on 01/28/12
Knudson, L. (2012). Gutting Out Costs At GM The Magazine Issue 5 Extracted from: www.hrmreport.comarticle/gutting-out-cost-at-GM/ on 01/28/12
Management Paradise, (2011). Human Resource Management of General Motors Extracted from: www.managementparadise.com/forums/human-resource-management-hr/214146-human-resource-management-general-motors.html, 01/28/12
New York Times (2011). Saab Future In Flux As GM Considers Opposing Sale Business Day Extracted from: www.nytimes.com/2011/11/05business/gm/-may-block-sale-of-saab-to-Chinese–carmakers.html?_r=1 on 01/28/12