Layoffs at GM: This is what the transformation of a century-old company looks like

Barra knows that reinventing a century-old business is painful, but that's the only option. Otherwise, it could suffer the same fate as Sears and General Electric (GE), who have not been able to adapt to future disruptions.

GM is making tough decisions today to prepare for the future of electric and driverless vehicles. The company announced Monday its intention to reduce its workforce by 15% and close five facilities in North America. These measures will save GM about $ 6 billion a year by 2020 – money it can use to invest in the future.

GM is also saying goodbye to the Chevrolet Volt, Impala, Cruze and other vehicles. Instead, GM will build more lucrative SUVs than Americans prefer.

"GM wants to leverage sport utility vehicles and high-yield trucks to lay the foundation for this self-sustaining future," said Jeremy Acevedo, head of industry analysis at Edmunds.

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"Technology is evolving by leaps and bounds now," said Acevedo. "It is predictable that even in a decade, this industry will be completely different from what it is today.They adapt to survive."

In a statement, Barra said Monday that GM recognizes "the need to stay in the face of changing market conditions and customer preferences to position our company for long-term success."

Barra said that it made sense to take these steps now, while the economy and business are strong.

GM under fire

But US and Canadian politicians are already criticizing GM for its intention to close factories that employ thousands of blue-collar workers.

The restructuring will be at the expense of approximately 8,000 employees. In addition, 6,000 hourly workers will lose their jobs or be reassigned to other factories.

"I was very hard, I spoke with her when I heard that they were closing, and I said, you know, this country did a lot for General." Motors, "Donald Trump told reporters on Monday.

Trump told Barra that she "would do better" to reopen her plants in the United States and soon.

Of course, Barra is trying to reposition GM so that it continues to be a major American force for the next century.

"She's not a nostalgic romantic with tears full of tears compared to what GM was," said Sonnenfeld. "She is not a politician, her mission is to tell the truth and to look after the economic health of her business responsibly and honestly."

Try to avoid the fate of Sears

The general manager of tomorrow could look more like Uber

"What keeps Walmart in the game is the daily low prices," said William Klepper, professor of management at Columbia Business School. "But what will keep Walmart ahead of obsolescence is online and they are as aggressive online as anyone."

Klepper said GM's leadership must be equally "ambidextrous" in building better vehicles today, but reinventing them for the future.

One year ago. GM said it could earn about $ 30,000 over the life of each vehicle sold for hundreds of thousands of dollars per car if it can sell trips rather than the car itself.

This kind of dramatic change could unfortunately cause more problems for GM employees.

"When transitioning to this new model for the future, there will be more and more pills difficult to swallow," said Acevedo.