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Oci white paper general motors

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  • 1. 1. Introduction The organization selected for this study is General Motors Venezuela. This company has an assembly plant operation located in the South American country, it employs about 3000 workers and 400 administrative staff members, its yearly production is close to the 80,000 vehicles per year and sales (from domestic built and imports) have recorded 165,000 units annually. The company has been present in Venezuelan marker for over 60 years and has been the industry leader for the 30 consecutive years. Its organizational structure consist of one President and six Vice- presidents for Finance, Sales & Aftersales, Planning & Engineering, Manufacturing & Quality, Human Resources and IT systems. These Vice-presidents are supported by first line managers and supervisors who lead most of the workforce. The manufacturing workforce accounts for almost 80% of the total employees. General Motors Venezuela is a GM business unit reporting directly to the GM LAAM (Latin America, Africa and Middle East) Operations offices located in Miami, Florida. GM LAAM is one of the four GM global division (Europe, Asia-Pacific and North America) that report to GM Corporation located in Detroit, Michigan. For this specific study we are concentrating on the Organizational Culture Inventory for GM Venezuela, which should reflect in some way the GM Corporation behavior and culture given the global strategy for this corporation. 2. Current Culture General Motors Venezuela is predominantly a competitive and oppositional style organization, considered as a aggressive/defensive style. GMV has been the market leader for 30 consecutive years, which support the results of being a competitive organization, and very aggressive style is predominant in its hiring styles by getting the most competent and well-prepared professionals and people in the market, eventhough
  • 2. they can lack the necessary skills to perform to its maximum potential. The company is drive by a fast pace manufacturing environment which coincides with an aggressive/defensive style. To be industry number one for so many years sets a competitive responsibility to maintain that status through a good manufacturing capacity and sales distribution networks. GMV shows itself as a good organization with a decent cultural status to the point to be considered one of the best companies and places to work in this country, even though their are quality, service and human resources issues lack top of the line benchmarking values. GMV is considered very oppositional due to its nature to work on “finding errors, wedding errors and promoting internal competition”. Most of the solutions are gather through several discussion that take many oppositional approaches, delaying many of the decisions and affecting at some point the product launching performance. I believe the results for the OCI for this organization is well developed. The lowest score was the humanistic-encouraging which seems to be a surprise to me. However, if I considered the whole human resources strategy in this company I have to recognize GMV and even GM Corporation is not well know to retained is most important asset, its people and talent. Although GM has set the mark for many technological advances its has been laying off its most trained and expert professionals, most of the workforce is not retained and turnover rates are very high for the industry, This indicates there is some lack of humanistic-encouraging focus, specially on this times of crisis, where job security is well value by employees. Although the autoindustry is mainly dominated by union, there is still no warrantee of job security , and economical downturns on regional economies affects this organization drastically.
  • 3. 2.1 GM’s Competitive Style Behavior General Motors has been the number one automaker for decades, now encountering the toughest competition from Toyota which became the #1 automaker (on sales) on year 2007. To be the number one for any industry sets certain patterns and behavior that can affect performance if not well driven. By being number one, this company must be reinventing itself all the time, changing and adapting to new situations since in theory they shouldn’t have anyone to follow. However we all know
  • 4. how competitive the auto industry is and how mature is its competition. GM has always considered Toyota its closest competitor and the benchmark for the industry. GM has set innovation in many fields of the auto industry, for example: market segmentation, digital and electronically equipped vehicles, truck endurance and resistance, new fuel alternative vehicle development, but has not be able to commercialize those technological innovations to the market in the most opportunistic way. Why is that? GM has always tried to be aggressive and competitive externally, always trying to defend its title against Toyota and other competitors in different segments, for that reason its internal culture is aggressive and competitive as well. It is no secret the financial trouble experience by GM at the present moment, one of the possible causes is do to its cultural background where previous organizational successes fuel the arrogance and short-term orientation of management, allowing the organization to appear effective. This conduct prevents organization, such as GM to adapt effectively to changes in their environment and have negative impact on their finances. GM appears externally as trying to maintain is leadership in the auto industry, by winning other competitors in sales and product. And although through the years GM has built competitive advantages such as production capacity, this has not aid to maintain their long term rein in the last decade. This competitive culture reinforces their internal culture of out-performing others co-workers and departments, by trying to prove their values compare to others. There is a very aggressive culture of goal setting and trying to meet them to the expense of others, reinforcing competition and confrontation over collaboration and teamwork. 2.2 GM’s Oppositional Style
  • 5. Internally General Motors is full of projects and interactions among different departments are required to launch products on time before the competition. GM has not been successful in the completion of new product cycles in less than 24 months, as Toyota. The general dynamics inside GM can be describe as oppositional, criticism is valued by thinking ideas need to be challenged too look for the most outstanding decision. The decision making process and workflow at GM is very slow and sometimes times consuming, delaying many of their final approvals, hence product launching. Due to the nature of the product and the safety considerations on design and other factors approval process is very strict and ideas need to be discussed and reviewed for flaws extensively in order to reach the most appropriate solution. What I saw at GM was basically not too much freedom for new ideas; it is true in recent years that cultural weakness was trying to change by listen more to the customers and employees on goals setting and continuous improvement ideas. However, critical decisions are still driven by top hierarchical positions, and the escalation process is still weak enough to reverse any problematic situation. GM has tried to improve its quality process and culture in the recent years, and although been successful in certain fields and products, the general culture still remains for looking at mistakes and point out flaws, especially in production sites. Over the last decade GM has tried to implement different phases of a program call GMS (Global Manufacturing System) based on lean manufacturing and quality methods that should increase the empowerment on workers, managers, engineers and general staff at the assembly line. This idea was based on Toyota’s quality and manufacturing strategies, where workers at the assembly line were empowered to stop the assembly line and dictate for themselves the quality of a component or assembly, not waiting to other levels of management to decide for them.
  • 6. GM has tried to change its culture, making it more similar to Toyota’s philosophy of quality, but while struggling to change its perception on quality and employee empowerment, financial situation is not helping develop the plans in a continuous and accelerate way. 2.3 GM’s Humanistic-encouraging style I was really shocked when I discovered that GM humanistic style is the lowest score of the OCI survey. I have seen how many human resource policies have been implemented at GM for many years, trying to overturn the empowerment in people and self-realization of its workforce. I believe there is still much to do to reinforce on the cognitive restructuring processes, where mentoring and coaching will lead the way to learn from doing and teaching others. Perhaps there is still too much confrontation at GM work environment limiting the humanistic-encouraging style to permeate through. It is not easy for such a big corporation to drive a cultural change to its workforce around the world, where there are many different cultural societies if different countries with personal identities. I always believed GM Venezuela was more encouraging that other GM sites, the teamwork spirit in this assembly plant boosted about a decade ago when plans for collaboration were injected to the employees. However, GM has a big turnover rate and low retention of its most qualify work force, making it more difficult to disseminate the concern for the needs, support and encouragement of others through new generations. GM invest a lot of money on training employees but sometime I think it will need to be more assertive and focus to deliver quality and proper training that will allow develop new skills and tools to employees so they can perform better. I also think part of GM management is changing, today GM is passing through a transition face were
  • 7. new and fresh management is coming the way to inject new ideas, coaching and empower the workforce. GM has a big challenge when talking about human resource culture, although considered one of the Top 500 companies is still struggling to define a new culture based on empowerment, encouragement and loyalty, by inspiring new generations to resolve conflict constructively and collaborate to improve overall performance, by braking cultural barriers around the world and set open networks that will streamline decisions. GM is always reinventing itself and is trying to learn from the best practices of its followers, always trying to set a standard for the industry. To be the leader for so many years has give GM too much confidence on its strengths and underestimate their weakness, especially on their human resource culture. 3. Targets for Cultural Change From the analysis of cultural targets for change GM (Table No.1) needs to focus on improving its approval style and decrease its conventional side. 3.1 Cross cultural commitment Although GM is considered an oppositional style company where conflicts are abundant, it is still predominant the approval culture where members come to consensus on decisions but there is a lack of commitment to what’s been decided. This is currently happening specially in the new global organizational structures where cross matrixes structure are conform through multiple projects, and resources are allocated from many different parts of the world, so team members try to avoid conflict due to ignorance on other countries cultures and behaviors. 3.2 Empowerment GM needs to set a more collaborative environment to work on constructive criticism to others. Many of the decision at GM are not followed by positive arguments that will
  • 8. lead to assertive conclusions, so employees will need to speak up more and try not to stick so much to the rules and standards, and do things for approval of others. There must be a better empowerment policy at GM that will allow more freedom on employees’ decisions in collaboration with experts and team members. 3.3 Work in collaboration supported by the global knowledge base GM has always fight to build commitment in its team members, however teamwork needs to be reinforce globally and projects and strategies need to be communicated globally. GM workforce need to share more of their experiences around the world, they are a huge corporation with an infinite knowledge base. GM is moving in that direction, trying to learn from the best practices from around the world from its different world division. 3.4 Innovation I order to decrease its conventional profile GM needs to nurture not only the continuous improvement culture, which is already in place, but also to work more on innovation. It has always been said the GM brands has the most conventional body style design and not as aggressive as the Japanese Honda or Toyota. GM needs to grab is strength on product improvement and work more on innovation to move away from conventionalism. GM has always has potential to innovation, but needs to go one step further and allow the innovation to come from all its workforce and knowledge worldwide. 3.5 Listen more GM top management needs to listen more to its employees and customers, to get more ideas and solutions from its global workforce who have multiple experiences around. Employees should be more open to discuss solutions in difficult situations and increase their feel of belonging to the company.
  • 9. 3.6 Keep reinventing itself I think GM needs to keep reinventing itself as has been done for its 100 years of existence. GM is one of the biggest and long living corporations around the world and its strengths are based on its survival strategies. To be the leader sets difficult challenges that make reflect and learn from mistakes. GM needs to move away from conventional human resource and quality policies, inventing new methods and procedures that will boost customers and employees loyalty. Table No. 1 Targets for Cultural Change Grid OCI Norms Your Raw Your Typical Ideal Gap Score Percentile Percentage Score Score 1. Humanistic-Encouraging 33 37% 85% 48 % 2. Affiliative 41 63% 71% 8% 3. Approval 35 85% 27% 58% 4. Conventional 33 75% 18% 57% 5. Dependent 33 66% 24% 42% 6. Avoidance 23 67% 27% 40% 7. Oppositional 32 95% 45% 50% 8. Power 31 80% 30% 50% 9. Competitive 38 96% 42% 54% 10. Perfectionistic 35 78% 25% 53% 11. Achievement 41 72% 78% 6% 12. Self-Actualizing 39 79% 82% 3% 4. Conclusion and reflections I believe this OCI exercise has awaken many ideas for my future performance on companies. I worked in one of the biggest corporations in the world that has been constantly reninventing itself to maintain its global leadership in the autoindustry. GM has grown to be a mature company that needs to reflect on many aspect related to its humanistic- encouraging style which will help increase its overall potential. Although considered a tough competitor with many advantages, GM needs to step back and work more on avoiding conventionalisms and try to set new rules in collaboration with its
  • 10. global partners and exploit that competitive advantage that hasn’t been used yet and create a constructive and collaborative culture that has always wanted to be. Before the OCI survey I had the feeling that GM in Venezuela was very much different from GM Corporation in Detroit, but after all it is clear the guidelines coming from the headquarters follow the same the cultural patterns. GM has forgotten about its weaknesses, specially on the humanistic-encouraging side which hast limit it operation and financial potential. This exercise has taught me to look back and be more reflective when working for big companies, sometimes managers can get self-conscious that companies behavior are set to operate in conflict and to argument on ideas, but need to be more collaborative and integral when making decisions. This cultural change needs to start from oneself and radiate this cultural improvement one step a time, through my team, and then my department, and then my coworkers around the world. This way permeating the cultural barriers among countries and societies and creating a collaborative and open culture to set new ideas and goals.