Saturn Car Case Review

Table of Contents

I. Introduction 3

II. Wake-up call 3

III. Advanced Product Design Team 4

IV. Common Threads of Success 5

V. Business and Marketing Strategy 8

VI. Challenges for Saturn 10

VII. Future for Saturn 12

VIII. Conclusion 13

IX. Bibliography 14

Introduction/Overview:

America did not alone invent automobile, but America had been the leader in the automobile technology and manufacturing for several decades. During that time, American automobiles shared their technology and know-how with Japanese and German manufacturers. And, American companies did not pay a great attention to what Japanese and German manufacturers have learned from their American counterparts. During 1940s, American has produced 80% of the world's automobiles, by 1960s, this has dropped to 50% and currently, American manufacturers only produce about 25% of the cars manufactured in the world. Since 1980s, there has been increased competition from Japanese and German manufacturers. Along with other American companies, General Motors has recognized this problem and took the challenge and owed to compete with Japanese small car manufacturers. General Motors spun off a separate car manufacturing unit, fully independent entity and named Saturn. This case review focuses on the Saturn Cars, its marketing strategy, pros & cons, competition, and future for the Saturn will be discussed in this case review.

Wake Up Call:

As the competition for car manufacturers was growing, the steady decline as a leader in the small & mid size cars woke up General Motors to do something to stay ahead in the market place. In early 1980s, Alex C. Mair, and two other senior engineers discussed a new and small innovative car project. It was from that idea the Saturn automobile was born.

GM established Saturn as a separate and independent subsidiary in 1985 with a total investment of about $5 billion. Former chairman of GM, Robert Smith thought Saturn as a laboratory to find and come-up with better ways to manufacture the future cars. GM wanted a truly separate Saturn away from traditional automobile hub Detroit. GM built the Saturn facility at Spring Hill, Tennessee. Saturn represented the single largest construction project in GM's history. Most of the GM's plants serve as assembly plants, and most of the GM's cars' were built using third party companies that provide parts.

Advanced Product Design Team:

By mid 1980s, the GM's advanced product research and design team has begun working on the project. Their approach was with a blank page, so they will not be influenced by management and other car designs at GM. However, Saturn insisted that it did not want to reinvent the wheel, but to see if there was a better a way of applying technology and employing creative talent in the making of a world class car in terms of quality and cost competitive manner. General Motors has selected a group of 99 people to head the initial Saturn efforts, comprising of design engineers, employees, union committee men, management and quality people to come-up with a design. At Saturn this team was called "Group of 99". The group of 99 spent about 2 months traveling in small groups and visiting various General Motors plants, and other companies in U.S. and abroad. The "Group of 99"'s objective is to find what works and what does not work. They have collected a list of threads which they call threads of success. The following is a list of threads that Saturn fully believes and committed to the threads.

Common Threads of Success:

* Quality is a top priority to maintain customer satisfaction

* Ownership by all, everyone is responsible

* Equality is practiced, not just preached

* Barriers to doing a good job are eliminated

* Total trust is a must

* People are the most important asset

* Union and management are partners and share in the responsibility for assuring success of the enterprise

* People are given responsibility and authority to do the job

* People will work together towards common goals under the right atmosphere of mutual trust and respect

* This can be achieved with people from a wide variety of cultures

* People will make personal sacrifices to achieve common goals if they believe their input is important and will be used

New Quality and Employee Participation Drive:

At Saturn, the management did not believe extensively in the automation and robotics on the production line. Instead, Saturn wanted to establish itself as a quality car manufacturer that will attract consumers. Also, at Saturn, the management and employees have enjoyed a fruitful relationship. The United Auto Workers Union (UAW) and the management at General Motors/Saturn wanted the company Saturn to succeed. This has resulted in establishing a partnership between the employees and management in an unprecedented way. All the important business decisions were made by both employees and management with a coordinated consensus. All the employees at Saturn plant had a rigorous training program, which focuses on team work, quality and productivity. Saturn has adopted a new way to assemble a car, the assembly line can be raised or lowered to improve time and efficiency of employees. Also, the assembly flooring was made of wood to make easier for the feet of employees. All Saturn employees have to go through 350 hours of training; they are constantly exposed to the common threads of success and the Saturn mission, philosophy and values. In fact, the employees are issues pocket size cards containing the information for quick reference.

Saturn Mission Statement:

"To market vehicles developed and manufactured in the United States that are world leaders in quality, cost and customer satisfaction through the integration of people, technology