AAA Framework General Motors

AAA Framework

• Increase market share by adjusting parts of a company’s business model to be suitable for Local Markets

• Necessary for Virtually all products.

Adaptation

General Motors, for example, intends to build 90% of its cars centrally around a core global architecture and then ship these to local plants where they can be adapted to local needs and tastes.

Their architecture must be flexible enough to deal equally with poor roads in India and smooth highways in the United States.

Aggregation

• Creating economies of Scale to exploit similarities• Introduce economies of Scale without jeopardizing

local responsiveness

Arbitrage

• Exploit differences between markets instead of trying to adapt to them Ex. By moving different parts of the supply chain to

different places

GM is using China’s unique combination of inexpensive labor, innovation and a strong work ethic to make Cost Effective cars for the export market