Saturn : A different kind of a car company : HBS Case

Essay by nirlayUniversity, Master'sA+, March 2006

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1. What is Saturn's strategy?

* Improvement in the Labor-Management Partnership. Changing the established relationship between GM and its unions

* Clear definition and articulation of company's mission and values. Challenge to the established norms of customer service. Making sure that every employee is aware of his goals and the ultimate purpose

* Improvements in design and manufacturing process. Most GM cars were criticized for obsolete designs and engines. Saturn wanted to change that perception by making frequent incremental improvements and designing the cars with advanced engine components and features as well as offering generous levels of standard equipment

* Increased emphasis on customer's service by building the positive brand awareness - 'selling the company with the car', identifying closely with the customer and treating him/her on a personal level. Enhancing the buying experience by offering 'no haggle' policy and friendly service

* Establishment of unique Retailer Relationship; only those franchises that demonstrated high levels of customer service were granted the right to sell Saturn

2. What resources and capabilities does Saturn possess?

* Access to vast resource of General Motors, its parent. Advantageous financing terms, ability to rise capital, use of GM's managerial talent

* Favorable supplier relationships. Close physical proximity and unique connection with suppliers of necessary parts

* Close ties to autoworkers union. Ready access to skilled labor previously displaced due to layoffs

* Joint GM venture with Toyota has taught valuable skills applicable to Saturn

3. How does Saturn's strategy exploit its resources and capabilities?

Saturn was able to obtain enough resources to be able to start with a 'clean sheet'. It was given enough flexibility to change well-established American auto manufacturing mode of operation. Since it had virtually unlimited access to both experienced management and labor, it was able to exploit it to...