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1. Describe five challenges that General Motors was facing before the acquisition of EDS?

Explain and provide support on how these challenges were / were not addressed after this

acquisition.

efore

! "rag#ented across several operating divisions$ #anufacturing facilities$ and dealer networ%s

! &ac% of world!class infor#ation s'ste#s support

! &ac% of a unified internal #anage#ent responsibilit' for our data processing s'ste#s

! (eavil' into co#puter!aided design and #anufacture of cars$ and burdened with a huge

worldwide accounting$ pa'roll and data processing needs

! (ard to #anage frag#entation proble#s

)fter

! *ntegrate the #assive and dispersed infor#ation s'ste#s of GM into a co##on s'ste#

! Get support to #a%e a world!class infor#ation s'ste#s

! Get co##on s'ste#s that able to achieve across the co#pan'

! +rofitable and own provider of state!of!the!art co#puter services$ eas' into co#puter!aided

design and #anufacture of cars$ and burdened with a huge worldwide accounting$ pa'roll anddata processing needs

! *n #ainfra#e area$ solve the frag#entation proble#s

,. *dentif' and explain the added value for General Motors in acquiring EDS co#pared to

outsourcing its *- function.

ctober of 10$ GM co!operated with EDS as the external vendor in outsourching the needs

of building GM2s *S.

GM2s pri#ar' goal in acquitition with EDS is 3

4 -o integrate the disparate co#puter s'ste#s of GM2s units5Difficulties in integrating the s'ste#s 3

-he shear si6e and the nu#ber of division 7perating divisions$ #anufacturing facilities$ and

dealer networ%s8.

-he various individual needs for each division.

EDS tried to understand the needs of each division and was able to build a s'ste# to #eet

whatever the of GM.

*t helped in the frag#entation proble#s.

9educed the cost of the central processing operations.

EDS built the s'ste# over the large nu#ber different divisions and also i#ple#ented support

#aintenance in those running s'ste#s.

*n 1:$ GM announced plans to split!off EDS fro# the corporation. GM will insource its2own *S *nfrastructure and Service rgani6ation. (owever$ so#e of the #a;or parts was still

handled b' EDS.

-o reduce cost$ as the' wanted to develop their own infor#ation s'ste#s in order to %eep up

with the lastest technolog'.

EDS cannot provide GM with the world!class *S support

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it difficult to co#pete for contracts with fir#s that co#peted with one or #ore of the

business lines of GM. -he case specificall' noted the fact that EDS lost out on bidding

for two contracts > ritish )erospace and &ucas *ndustries > because the' co#peted with

GM and its (ughes )ircraft subsidiar'.

)nother factor was the fact that while EDS did do #uch good for GM$ the' were notsuccessful in all areas. -he case pointed out that one of the pri#ar' goals of the

acquisition was for EDS to help with the integration of disparate co#puter s'ste#s across

GM2s units. -his did not happen$ nor could it under EDS2s direction. -his required

consensus and direction fro# within GM.

"inall'$ *- had beco#e so i#portant to GM that the leadership felt that the' needed the *-

expertise to be in!house in order to be as responsive as possible to the needs of GM and

its various business units.

. )nal'6e General Motors2 co#petitive advantage using +orter2s "ive "orces #odel.

=hich of these five forces is #ost i#portant to General Motors? Explain wh'.

1. argaining power of custo#ers

,. *ntensit' of co#petitive rivalr'