Introduction
The 7-s diagnostic model highlights seven primary areas in which organizations engage in internal change for benefits, such as improved brand image, increased customer base, the attraction of new clients, saving of resources, and marked up profitability. The change design above intimates that for businesses to improve their competitiveness, their structure, systems, superordinate goals, skills, staff, style, and strategy have to enmesh. In the past, companies, such as Ford and General Motors, have implemented a change to avert bankruptcy from persistent losses advanced by poor managerial decisions using the 7-S diagnostic technique. Through specific strengths, weaknesses, opportunities, and threats (SWOT) analysis of two significant internal business changes executed by General Motors and Ford, the use of the 7-s model to transform the mentioned businesses’ operations may be identified.
Elements of the 7-s model
The 7-s model has seven key elements that comprehensively define an organization’s entire existence. According to the model, all businesses have a formal structural design, a strategy that shows handling external changes that threaten their market competitiveness, and a system dictates how duties are executed, such as information technology departments, accounting practices, and training systems ( Shaqrah, 2018) . Moreover, firms have a management style evinced in how leaders conduct themselves and interact with subordinates, the staff method showing how employees are selected, hired, trained, developed, and maintained, and skills that comprise what an organization does best. Finally, all companies have superordinate goals embodied in planned operation missions, visions, and objectives. Every time an organization wants to implement change, it must assess its new strategy will affect all the 7-s elements.
Delegate your assignment to our experts and they will do the rest.
Changes at Ford
In 2006, Ford hired Alan Mulally as its chief executive officer, after facing a series of financial crises that threatened to propel its permanent closure. Mulally immediately designed the “One Ford” plan, which primarily comprised changing Ford’s superordinate goals, style, strategy, and systems. To begin with, Mulally mortgaged Ford’s assets to raise finances for business improvement and was awarded $23.6 billion ( Baker, 2015) . Additionally, Mullaly reduced Europe’s operation costs by 18%, which resulted in a reversal of an impending $30 billion projected losses that in 2009 and savings of $500 million in the European market ( Baker, 2015) . Finally, he new CEO created weekly meeting schedules for Ford’s global leaders that were mandatorily attended via conference calls, and project signs of progress were discussed extensively at every meeting. Finally
SWOT Analysis of the FORD 7-S Change Plan
Alan Mulally’s One Ford plan had various strengths, weaknesses, opportunities, and threats as mentioned below:
Strengths-Ford’s collection of funds to change internal operations was a genius plan, because profitable projects with insufficient funding resources were completed on time. Additionally, compelling managers to attend weekly meetings was commendable, because they were able to pinpoint weak areas of their assigned ventures, discuss possible solutions, and implement them ( Budiman, Tarigan, Mardhatillah, Sembiring, & Teddy, 2018) .
Weaknesses-Mulally did not address other essential factors, such as customer service and external brand complains.
Opportunities-Mullaly’s One Ford plan might have been better if he also considered integrating new technology to improve the attractiveness of Ford’s vehicles as most efficient for client consumption.
Threats-Ford is a global corporation, and Mulally lacked a comprehensive means to ensure that indeed, all managers implemented the One Ford plan in their respective units.
Changes at General Motors
Established in 1908, General Motors had been the leading vehicle manufacturing company in the United States until the 1950s when Japan’s Toyota model started gaining popularity. In 2001, General Motors faced bankruptcy advanced by excessive expenditure over profits, which mandated the business's internal change, systems, and style. First, GM reduced the number of workers globally from 266,000 to 101,000, and factory workers from 60,000 to 40,000 ( Khan & Hashim, 2014) . Additionally, the organization changed its top-down management style by including employees in its decision making. Non-profitable branches were closed down, and part of them sold to China. In this way, General Motors regained its position as the leading car and vehicle spare parts manufacturer globally.
SWOT Analysis of General Motors’ Change Plan
Strengths-General Motors cut operation costs, a commendable plan that saved the company’s overall cost of conducting business.
Weaknesses-General Motors failed to reconsider how other factors, such as poor client service at car retail showrooms and backward technology may have propelled its near-bankrupt state ( Midor, 2019) .
Opportunities-General Motors could still improve its profitability by manufacturing fuel efficient vehicles or hybrid cars.
Threats-Other firms, such as Ford, still threaten General Motors’ profitability, especially with Mulally’s implementation of the One Ford plan.
Comparisons and Potential Resistance Areas
Ford and General Motors identified the factors that threatened their sustenance and competitiveness promptly. Additionally, the two-vehicle manufacturing companies instituted changes that reversed threatened closure by cutting losses. Finally, General Motors and Ford changed their leadership styles, which played a role in restoring their brand images. However, possible resistance to change from internal staff may have resulted from procedural familiarity, biased information processing, fear of unknown change outcomes, and group inertia.
Recommendations
Ford and General Motors should explore their opportunities to strengthen their competitive advantage in the automotive industry. The mentioned organizations should create fuel-efficient cars, which would attract more clients and propel increased revenue. Finally, the two organizations should invest in their client service skills to sustain existing customers and retain their current positive brand image. Therefore, in addition to Ford and General Motors’ strategic change management plans, the organizations could improve their profitability by improving client service skills and investing in new technology.
References
Baker, C. R. (2015). Organizational change at Ford Motor Company in the face of international financial crisis. https://www.cairn.info/revue-recherches-en-sciences-de-gestion-2015-5-page-23.htm
Budiman, I., Tarigan, U. P., Mardhatillah, A., Sembiring, A. C., & Teddy, W. (2018). Developing business strategies using SWOT analysis in a color crackers industry. Journal of Physics: Conference Series , 1007 , 012023. https://doi.org/10.1088/1742-6596/1007/1/012023
Khan, M. A., & Hashim, M. (2014). Organizational change: Case study of General Motors. ASEE 2014 Zone I Conference , 1-5. https://www.asee.org/documents/zones/zone1/2014/Student/PDFs/159.pdf
Midor, K. (2019). New technologies and quality of customer service – case study. Multidisciplinary Aspects of Production Engineering , 2 (1), 548-558. https://doi.org/10.2478/mape-2019-0055
Shaqrah, A. (2018). Analyzing Business Intelligence Systems Based on 7s Model of McKinsey. International Journal of Business Intelligence Research , 9 (1), 53-63. 18 https://doi.org/10.4018/IJBIR.2018010104
