Transmission question

The encoder motor on the transfer case has failed. This is not uncommon with GM's push button or rotary dial transfer case selectors. The gears in the encoder are worn out allowing the transfer case to slip into neutral. When you shut off the vehicle and restart. the encoder motor is cycled by the computer then put back into the range selected. eventually it will fall back into neutral though. This is more common on vehicles that are driven mostly in AWD mode. I tend to leave mine in 2HI most of the time to extend the life of the encoder.

I was also told that the transmission computer could be bad, is this the same thing that y o u are talking about.