Gm Restructured

Organizing is the process of arranging people and resources to work toward a common purpose. When there are clear missions, core values, objectives, and strategy, organizing begins the implementation phase. This phase answers the questions, who is in charge, what is going on, who will be effected and how things relate to each other? Organizing seems to be easier on centralized and not decentralized organizations. GM which started as decentralized organization wanted to be more centralized like its competitor Toyota. For example GM marketed about 8 midsized sedans which all 8 had different names and different parts from all over the world. However, Toyota a more centralized company marketed only a couple sedans. GM saw the success of Toyota and wanted to be more of a centralized company. This required reorganization of the whole company.

The First step was for GM to realize the flaws of being decentralized. Reorganization for any company is not something easy and nothing something that can be done over night. GM is such a huge company with many locations and different divisions all over the world. Most of the division would run on its won management and would try to differ from other divisions. Each division had its own suppliers and own purpose. GM needed to create one common purpose and have everyone work to reach that purpose. The first attempt to change the company around occurred in 1984 by Roger Smith, the CEO of that time. The attempt to reorganize was a complete failure and it took a hard hit on the company. The focus of this change was to "streamline GM's processes by merging the engineering and manufacturing activities of the five passenger-car divisions and Fisher Body into to centralized organizations." This change was a completely failure. At the end it wiped out Fisher Body which was more centralized like Toyota.

Next, Jack Smith the CEO of GM in 1992 wanted to start the change from a decentralized company to a more centralized company. Jack's first attempt to reorganize was turned down the Board of Directors. The Directors did not have the same vision of changing the company into a centralized company. He started by with the purchasing divisions. Before Jack, there were 27 purchasing divisions in N. America. Jack took all 27 purchasing divisions and makes it into one global operation. The objective of this move was because GM was paying a premium for "complexity and losing economics that come from volume buys." This was one of there short term goals. For a long term goal GM wanted to combine the manufacturing and engineering groups. This will be hard to do because there were many manufacturing