General Motors : Model of Global Marketing or Global Mismanagement?

Abstract

Globalization has become the catch phrase of the twentieth century and reveals the desire of business interests to exploit the potential benefits of expanding operations into nondomestic markets. The marketing strategy that a specific company adopts when entering a new market varies widely depending on how relevant factors such as economic variances and cultural differences are considered. Using the Department of Marketing in General Motors Ecuador (GME) as a case study, the influences which organizational structure, the state of the economy and cu1tura1 differences have on a mu1tinationa1 corporation will be analyzed. A two-part survey was administered to the GME administrative employees to determine their satisfaction with the company as a whole, their relationships with co-workers and their feelings about the recent economic downturn. In Survey I, most employees were satisfied by the opportunities to advance within GME, the valuable experience they are gaining for the future, and their relationships with co-workers. Greater dissatisfaction was revealed concerning benefits and access to supplies. Survey II revealed that most Ecuadorians consider their government indecisive. They regard the governmental treatment of the country's economic hardships as inadequate and call for changes such as tax reform. Within the GME division, specific changes have been instituted to weather the economic recession and to remain competitive. However, corporate headquarters in the United States is not as knowledgeable as subsidiary managers and often overlooks the importance of cultural and economic variances. Frequently adopting an ethnocentric view, corporate strategies are designed within the United States and implemented with very little modification throughout the various host countries. As a result, the inevitable costs of mismanagement, as well as the potential benefits of changing corporate policy to reflect differences within a given host context, are all too frequently overlooked.