General Motors is a multinational company based in the United States. More commonly known as GM, the corporation manufactures, markets and distributes vehicles and vehicle parts. Today’s post covers how GM experienced a supply chain disaster with the robot mania disaster in the 1980’s.
What went wrong?
General Motors is a well known corporation and has been since its birth in 1908. However, in the 1980’s GM experienced a halt in their supply chain processes causing disaster for the corporation. Their innovative CEO at the time, Robert Smith, launched a robotics project costing billions of dollars. The robots were used on the manufacturing lines and constantly malfunctioned often breaking materials, painting themselves and ruining the entire plant’s production process.
The robots slowed production creating a manufacturing nightmare for GM. With the amount of money that was spent on the robotics project, GM could have easily bought both the competing companies of Toyota and Nissan.
Results of the Robot Mania Disaster
Production Failure: General Motors was unable to produce product quickly and efficiently because of the robotic machines malfunctioning.
Logistics Failure: General Motor’s outbound logistics suffered. The halts in production to repair the robotics caused an inability to distribute their products.
Sales Failure: Due to the drastic delays in the production and distribution of products, General Motors’s sales slowed. Customers didn’t want to wait longer for products or risk getting damaged products.
The General Motors fed millions of dollars into ongoing robotics repairs, causing them to incur large losses.
As a result, other competing companies were able to grow and take advantage of the gap in the vehicle manufacturing industry. General Motor’s competitor Toyota began to deliver low cost and high quality vehicles, establishing themselves more in the industry.
Takeaways
While being innovative and looking for the next new tech is encouraged in any industry, it is imperative that you test your options! A lack of preparation will lead to disaster in your supply chain and management process.
Research and test every decision before implementation. This will ensure the success of the final product!
