GM’s “act as one team” philosophy is redefining supplier partnerships and strengthening internal culture

GM, a company synonymous with automotive innovation, is currently undergoing a significant cultural shift. At the heart of this transformation is the need to balance two traditionally separate operations: production and customer care. As Heather Latham, director of supplier management – customer care and aftersales at GM, reveals, the company is focused on unifying its supply chain strategy to create a more cohesive, customer-focused approach. This change is not just about restructuring operational processes but also involves a deep cultural shift that permeates GM’s internal teams and external supplier relationships.  

In an industry where production typically takes precedence over aftersales service, GM’s efforts aim to ensure both aspects of the business receive equal attention. Through operational changes, strategic integration of technology and relentless internal advocacy, Latham and her team are pushing to establish a new standard of customer care that complements GM’s manufacturing prowess. 

“I realised I was talking to the same suppliers as OE, but as if I were from a different company, and it didn’t make sense. Suppliers often viewed CCA as a secondary priority because their immediate focus was keeping the assembly plant running” – Heather Latham, GM

Breaking down silos 

One of the most profound changes in GM’s supply chain strategy has been the integration of its customer care and aftersales (CCA) team with the global purchasing and supply chain team. Historically, GM’s supply chain for original equipment (OE) and service parts operated as two distinct entities, creating inefficiencies, particularly when dealing with suppliers.

“I realised I was talking to the same suppliers as OE, but as if I were from a different company, and it didn’t make sense,” Latham explains. This separation not only complicated communication but also led to suppliers prioritising OE at the expense of CCA. “Suppliers often viewed CCA as a secondary priority because their immediate focus was keeping the assembly plant running,” Latham says. While maintaining production flow is vital, she emphasised the need for suppliers to understand that service parts are just as critical, as GM’s customers rely on them to keep their vehicles operational. 

The decision to integrate these teams in June 2023 was a crucial step in eliminating this disconnect. The goal is to present “a unified front” to suppliers, ensuring GM’s diverse needs are met without compromising customer service. “We need to act as one team,” Latham stresses, adding that this shift not only simplifies internal processes but also sends a clear message to suppliers: GM values customer care as highly as production. 

Acting as one team

The integration of GM’s supply chain teams is more than just an organisational reshuffling – it is a move to foster collaboration and streamline decision-making. Latham emphasises that one of the biggest hurdles in the past was the perception that suppliers could make decisions on behalf of GM, especially when it came to allocating resources between OE and CCA. 

“When a supplier says, ‘I have to produce these parts for OE or I’ll shut down the plant,’ we need to ask why they feel they have to make that decision,” Latham notes. “GM should be the one providing direction, not the supplier making assumptions.” She explains that suppliers should not simply make an allocation decision and move on but work with GM to understand why such decisions are necessary in the first place and how to prevent them in the future. 

GM is taking control of those decisions, aiming to be proactive rather than reactive. This approach not only improves efficiency but also fosters a stronger sense of accountability and partnership between GM and its suppliers. 

Balancing manufacturing and aftersales demand 

One of the most challenging aspects of this cultural shift has been finding the right operational balance between manufacturing and aftersales services. Traditionally, the demand for OE parts was closely tied to contractual volumes, while CCA demand was treated with more flexibility. This lack of specificity on the service side created gaps in GM’s supply chain, often leading to delays in fulfilling service parts orders.

“We are discussing enhancing the way we tie contract volumes with our demand forecast so that we can ensure the supplier has the capacity needed to meet the holistic demand” – Heather Latham, GM

By formalising CCA demand in the same way OE demand is managed, GM aims to eliminate these gaps and ensure suppliers can meet both production and customer care needs without compromise. 

GM is also enhancing its demand forecasting capabilities to avoid these issues in the future. By tying contractual volumes to service parts, GM ensures that suppliers have clear expectations regarding the volume they need to produce. This operational change is critical to maintaining the balance between production and aftersales services, especially as customer expectations for timely service continue to rise. 

Integrating sourcing systems 

One of the most significant changes on the horizon for GM is the integration of its two separate sourcing systems for OE and CCA. Currently, these systems operate independently, further contributing to the divide between the two supply chains. However, by 2025, GM plans to merge these systems into one, allowing for a unified demand forecast that simplifies supplier planning and improves overall demand management. 

“When we integrate the systems, that will give us a better ability to have one demand for GM to the supplier versus two separate, disconnected demands,” Latham explains. This integration will not only streamline operations but also give suppliers more clarity and predictability when planning their production schedules. 

The move towards integrating sourcing systems is a crucial part of GM’s broader strategy to present a unified face to suppliers. By consolidating its operations, GM can ensure that suppliers view the company as a single entity with consistent priorities, rather than as two competing divisions. 

Persistent push for cultural change 

Operational adjustments alone are not enough to drive the change GM seeks. Achieving true transformation requires a cultural shift, both internally and externally. Latham stresses that this is an ongoing process, requiring constant communication, education and advocacy. 

“It’s a 24/7 effort,” she says. “You can’t let your foot off the gas. If you start to sway, you have to keep going, or you’ll fall backwards.” Latham explains that every supply constraint is an opportunity to remind both internal teams and external suppliers of the importance of treating OE and CCA with equal priority. 

This cultural shift is about changing long-standing habits and mindsets, particularly when it comes to how suppliers interact with GM. “We’ve been operating separately for many, many years. It doesn’t change overnight,” Latham acknowledges. “But we’re working very hard to get everyone – internally and externally – thinking about it differently.” 

GM’s senior leadership plays a crucial role in supporting this transformation. Latham highlights the importance of leadership backing in making these changes a reality, citing the support of her senior vice president, Jeff Morrison, who has made supplier alignment a priority in key business meetings. 

Leveraging AI and predictive analytics 

As GM continues to push for operational and cultural change, the company is also leveraging advanced technologies to anticipate demand more accurately, particularly in areas where historical data is limited, such as electric vehicles (EVs). With EVs being a relatively new technology, automotive companies cannot rely solely on past performance data to predict future needs. Instead, the GM is using AI, predictive analytics and market intelligence to fill in the gaps. 

“We are using a lot of market intelligence, benchmarking and anticipated failure rates to estimate demand,” Latham explains. One of the key tools GM employs is its Supplier Health dashboard, which helps the company gauge potential supply issues before they arise. The dashboard tracks factors such as supplier location, commodity type and past due electronic data interchange (EDI) statuses, enabling GM to intervene early and prevent supply chain disruptions. 

This proactive use of technology is essential for managing the complexities of modern supply chains, especially as the automotive industry transitions toward more EV production. 

Strengthening supplier relationships 

At the heart of GM’s strategy is its effort to strengthen relationships with suppliers. Latham emphasises the importance of clear communication and collaboration, particularly when it comes to making allocation decisions. 

By ensuring that suppliers understand GM’s priorities and by working with them to resolve constraints, GM is fostering a more collaborative and aligned approach to supply chain management. 

This emphasis on partnership extends to every interaction GM has with its suppliers. Latham notes that suppliers are increasingly coming to GM with solutions rather than problems, a clear sign that the company’s message is being heard. “I’ve received feedback from suppliers who now understand they need to think about GM as one customer, not two separate entities,” she says. 

A long-term commitment to change 

As GM continues to implement these changes, the company remains focused on the long-term goal of creating a more unified, customer-centric supply chain. The integration of sourcing systems, the emphasis on demand forecasting and the use of AI and predictive analytics are all critical steps toward achieving this goal. However, Latham acknowledges that the journey is far from over. 

“We’ve been separate for many, many years. It doesn’t change overnight,” she reiterates. “But with strong leadership support and a relentless focus on customer care, I’m confident we’ll make a difference.” 

Ultimately, GM’s efforts to prioritise customer care alongside production are reshaping the company’s approach to supply chain management. Through operational changes, technological innovation and a persistent push for cultural change, GM is paving the way for a more integrated, efficient future – one where customer satisfaction is just as important as production output. The goal, as Latham puts it, is to make allocation decisions a last resort, ensuring that GM’s supply chain meets the needs of all its customers, both now and in the future.