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Management Information Systems

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General Motors has several internal and external influences that are challenging them to reduce their operating costs and become more efficient. In doing an analysis of the General Motors using Porter's Competitive Model these influences become clear and opportunities for the company to reduce costs and increase efficiency using information systems becomes obvious. Porter's Competitive Model is a model used to describe the interaction of external influences; specifically threats and opportunities that affect an organizations strategy and ability to compete [Laudon & Laudon, 2005, p. 103].

Starting at the center of the model is the current industry, which includes General Motors and their typical competitors, such as, Ford, DaimlerChrystler, and the Japanese [Laudon & Laudon, 2005]. All of these traditional competitors are able to produce cars at a much cheaper cost than General Motors.

Looking at the supplier portion of the competitive forces model, part of the reason General Motors was unable to produce cars inexpensively in comparison to their competitors was that they were producing a lot of their own parts. Their competitors were able to purchase parts from outside vendors at lower prices. General Motors viewed this as an opportunity and has since shed a lot of workers and factories and are currently searching everywhere for the lowest prices on parts. Also General Motors was very slow at producing cars because of old information systems and outdated processes. A lot of General Motor's systems could not communicate with each other, which was causing a major lag in the production of automobiles. By integrating these systems they were able to become faster and leaner and were able to increase their customer focus [Laudon & Laudon, 2005].

In the competitive forces model, General Motors also has influence from new products and services to reduce costs and increase efficiency. General Motors wants to experiment with new ways to serve their customers, one of which was online shopping, allowing customer to shop for car models and colors online and giving them dealerships in the area that were currently in possession of the car they preferred. By utilizing the Internet, GM was able to provide additional services to their customers and allow them to also purchase vehicles online. General Motors also found an opportunity to build vehicles to order. This allows them to reduce the cost of inventory and sales incentives by finding ways to make cars that customers have actually ordered [Laudon & Laudon, 2005].

Another new technology-based service General Motors has been experimenting with is called OnStar. OnStar is a navigation, Internet, safety, and communications capability that is available on a majority of GM models. Customers have to subscribe to the service but with the service they receive roadside assistance, stolen-vehicle tracking, and concierge support such as making dinner reservations [Laudon & Laudon, 2005, p. 111]. OnStar is a comprehensive service, however, has not been successful in gaining interest of a lot of GM customers.

New entrants to the automotive market have been a threat to General Motors. Some of these entrants include Nissan and Hyundai. Although, they have been around for a while, they are increasingly gaining a large portion of the market and have been very efficient in product development and bringing new models to the market quickly. In response to this threat General Motors has attempted to stream line their product development portion of their business. In the past, General Motors would have to go through several departments and systems to take a car from design phase to actual production. The average was typically 48 months for this process.

After some analysis, General Motors has formed a single committee that now handles the entire product development process. They removed all of their former design and engineering systems and replaced them with a single system called EDS's Unigraphics [Laudon & Laudon, 2005, p. 112]. Everyone involved in the committee has access to this new system and are able to access from a web-based interface to share three-dimensional designs [Laudon & Laudon, 2005]. It now takes General Motors approximately 18 months from initial design to production.

Customers also play a part in the competitive forces model. General Motors still struggles in changing potential and actual customers perception of the company from a second rate automobiles compared to their competitors. With the Internet service and new product development technique they hope to change this perception and bring new automobiles and services to these customers.

Information technology has played a large role in the redesign of General Motors. They have been able to successfully reduce operating costs by becoming more efficient and competitive. They have integrated several systems and have stream lined internal processes to reduce costs and have also utilized the Internet to gain new customers and aid in sales of automobiles. General Motors will need to continue using information systems to gain advantages over their competitors and to stay a major competitor in the automotive market.


Within the last few years preventing future terrorism attacks like the one that occurred on September 11th has become a major concern for both citizens and the government of the United States and globally. In response to this concern, governments and their organizations have created massive databases of personal information on citizens and whom they think could be potential terrorists. These databases have brought up questions of social and ethical issues regarding citizens' privacy and rights in regards to the information being collected.

Ethical issues are a concern on the individual level [Laudon & Laudon, 2005, p. 153]. Citizens need to be concerned about the information that is being gathered about them from these systems and how it will be used. As individuals, we need to know if the information being gathered about us by the government is going to improve our quality of life and ultimately protect us or will it hinder our everyday lives. For example, the government is keeping track of travelers that could be a potential terrorist, but some of that information is not current and could cause a person to be wrongly identified. Another major concern is that someone may steal information, such as, a hacker to use for purposes of identity theft or harassment.

On a slightly broader scale there are social issues that surround the collection of personal data. Bringing up questions of how the collection of personal data will affect society and better society as a whole. If the



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