LorryMer Corporation was a leader in a specialized motor vehicle industry in North America. In the early
2000s its sales began to suffer substantially due to the recession in the U.S. economy. As a result, the
company was forced to change its primary strategic objectives to focus on cost efficiency. It needed to cut
operating costs to improve the company ’ s competitive position. LorryMer specializes in the design,
development, and manufacture of a complete line of technologically advanced motor vehicles. The
company has been in business for more than six decades, and now operates seven major vehicle
manufacturing plants and one parts manufacturing plant in North America. With more than 14,000
employees, its mission is to provide the highest standard of technological innovation and premium quality
to its customers. LorryMer remains committed to the highest degree of innovation and quality, and is
dedicated to meeting its customers ’ needs.
Saul McBarney, LorryMer ’s information technology (IT) program management officer, has been with the
company for 25 years. Saul is proud of the company’s history, strategy, and background. “ We are unique
in terms of listening to the customers. We find out what customers’ business needs are first, and then
develop products for them that meet their needs. ” However, 2001 was a painful year for LorryMer. As a
result of economic hardship in the motor vehicle industry, the company ’ s sales and profits dropped, and
its losses exceeded $ 1 billion. In September 2002, the Refrigerated Transporter reported that depressed
used automobile prices caused many carriers to extend trade cycles because they owed more on their
automobiles than they could sell them for. As a response to the crisis, the company embarked on a major
cost savings initiative in late 2001, which later produced a number of cost savings programs.
Dingo Ostar, a LorryMer business value account manager and a member of the business advisory group,
said, “ It was about cost, cost, cost and nothing else . ” Nevertheless, LorryMer continued to experience
substantial business challenges in the following years. With the economy still suffering, LorryMer’s
automobile production in 2002 did not meet 2001 production levels, which were significantly lower than
2000. Funding for any new programs was minimal, especially during 2003. LorryMer needed to change in
order to survive.