Ref: IMD-7-2015

Case study

Reference: IMD-7-2015

Order this case study


Mary Barra and the Lyft Investment: Leading GM into the sharing economy through

The case presents the impact of the digital disruption coming from the sharing economy from the perspective of the largest American auto manufacturer, General Motors (GM).

The car-sharing business led by Uber has been forcing a change to the traditional model by introducing the for-hire transport business especially in densely populated urban settings. At the same time, technology innovation has allowed non-traditional competitors making serious advancements. For GM, despite its history of innovations, these forces represent uncertainty and perhaps even an existential challenge.

At the beginning of 2016, GM failed to acquire Lyft, the most promising competitor of Uber and ended up in an investment of $500 million corresponding to only 9% of the company. This investment, together with other two (Maven and Cruise Automation) are the proof that GM and its CEO Mary Barra, realized how difficult would be - for a company of the size and structure like GM - to compete with agile and innovative start-up companies leveraging on data and digital technologies.

Despite being the pioneer of the technology of the connected cars with its OnStar® technology, GM finds itself desperately looking for insights and customer data that would allow better understanding the changing preference of the urban customers shifting their consumption behaviour from car-ownership to shared mobility services. With declining market share in the traditional automotive space, Mary Barra is called to make a tough strategic call that should attempt to steer this giant and iconic American company into a new ecosystem where value creation is much more delocalized and where GM should attempt to take a large part in order to avoid the risk of irrelevance that the new competitors and the digitally enabled service-based economy are posing.

What should Mary Barra do with Lyft and how should Lyft be integrated in the future offering of General Motors?

Learning Objective

In a disruption event, multitudes of elements are changing simultaneously causing enormous pressure on an incumbent company of the size of GM. The learning objectives are:

  • Shifting customer preferences using the Kano model: traditional car owners vs users of mobility services.
  •  Shifting of the center of gravity in the value constellation: linear build-sale-repair model  delocalized structure.
  • Strategy map (Hambrick’s diamond) to evaluate Mary Barra’s strategy with Lyft
KeywordsBusiness Model, Customer Insight, Ecosystem, Innovation, Operations, Segmentation, Sharing Economy, Strategy, Value Constellation
SettingsNorth America
General Motors
2014 - 2017
TypePublished Sources
Copyright©2018
LanguageEnglish
Related materialTeaching notes
Order this case study

Reference: IMD-7-2015

IMD case studies are distributed through case clearing houses. In order to browse the collection and purchase copies please visit the links below.

The Case Centre Cranfield University

Wharley End Beds MK43 0JR, UK
Tel +44 (0)1234 750903
Fax +44 (0)1234 751125
Email info@thecasecentre.org

The Case Centre Babson College

Babson Park Wellesley MA 02457, USA
Tel +1 781 239 5884
Fax +1 781 239 5885
Email info.usa@thecasecentre.org

Harvard Business School Publishing

60 Harvard Way Boston, MA 02163, USA
Tel (800) 545-7685 Tel (617)-783-7600
Fax (617) 783-7666
Email custserv@hbsp.harvard.edu

Case Center Japan

2nd Floor, Toranomon Jitsugyokaikan,
1-1-20 Toranomon, Minato-ku,
Tokyo 105-0001 Japan
Tel +81 3 3503 6621
Fax +81 3 3501 0550
Email info@casecenter.jp

Copyright information

IMD retains all proprietary interests in its case studies and notes. Without prior written permission, IMD cases and notes may not be reproduced, used, translated, included in books or other publications, distributed in any form or by any means, stored in a database or in other retrieval systems. For additional copyright information, please contact our Information Center.

Do you need more information?
Contact us for additional information or republishing

Case study

Reference: IMD-7-2015

Order this case study

Looking for something specific?

Keep reading

Back to top