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Chevy Volt

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Submitted By vikram741989
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1. What does the Chevy Volt case tell you about the nature of strategic decision making at a large complex organization like General Motors?
Strategic decision making is often met with cognitive biases that are formed around prior victories or defeats.
From the Chevy Volt case, we can see that GM is a large complex organization and has a lot of processes to make any decision in changing their strategic plan. Moreover, they sticked to the past failure that they had experienced. Therefore, they moved too slow and missed the opportunity to change or adapt themselves to the external trend or a better opportunity.
The nature of strategy made was based on the following factors
• Increase in oil price
• Limit carbon emission go green
• The cost of manufacturing lithium ion batteries was falling

2. What trends in the external environment favoured the pursuit of the Chevy Volt project?
Trends included increases in oil prices :-Gas price was increasing sharply because of growing demand in developed countries including China and India
-Global Warming become a significant concern so people trend to use the car which produce less Carbon Dioxide.
-The cost of Manufacturing lithium ion batteries was falling and new technology make them more powerful, competitive use of battery technology for fuel efficiency.
-Demand for fuel efficient car like Prius (Toyota) that utilize new battery technology shows the customer demand for fuel efficient cars

3. What impediments to pursuing this project do you think existed within GM?
Cost is one of the most important hurdles in pursuing with Chevy Volt
-GM already spent a huge investment in developing fuel cells. The presence of GM senior management cognitive biases stemming from prior investments of fuel cells
-Many decision makers in GM didn’t want to suddenly switch gears and focus on lithium ion batteries instead

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