Chapter 1 Case Study Essay

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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 GM?
The Chevy Volt case goes to show how complicated decisions become for seemingly new ideas. The time it took to get the Chevy Volt off the ground and into production was a significant reason as it has not been so successful. Although the marketplace knew that both gas prices were rising and carbon emissions were going to be more closely regulated the company dragged its feet on the project. It took the consumer confidence in the car at the auto show to push it over the edge. Management also was hesitant to change to an electric car due to past failures.

2. What trends in the external environment favored the pursuit of the Chevy Volt project?
The trends in the external environment that made the pursuit of the Chevy Volt a must for GM was the success of the Prius. The Prius was also successful due to other factors such as heightened consumer awareness of emissions coupled with the impending regulation as well as rising gas prices.

3. What impediments to pursuing this project do you think existed within GM?
The fact that management took so long to back the project was what really slowed down production. Management didn’t want to invest in the volt because they had already spent so much money in the fuel cell and a previous failure of the EV1.

4. The plan for the Chevy Volt seems to be based partly on the assumption that oil prices would remain high, and yet in late 2008, oil prices collapsed in the wake of a sharp global economic slowdown.
a) What does this tell you about the nature of strategic plans?
This tells us that while good plans can be put in place to take advantage of external factors the company needs to act swiftly to take advantage of them.
b) What do falling oil prices mean for the potential success of the Chevy Volt?
It could hurt sales if consumers become less concerned with the price of gas. As it is intended to take advantage of consumers while the prices are high, lower prices will have a negative effect.
c) Do you think oil prices will remain low?
I think
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