100 Days of New GM: Management

[MonaroSS]

100 Days of New GM: Management

Lead Editor: MonaroSS
GMI Contributor
Contributing Editor: Mark Bono
ChevyRules, GMI Staff Member

Will Ed Whitacre lead General Motors to a New Day?

New GM Management

More interest and focus has been placed upon the Management of GM in recent times than probably any other manufacturing company in a generation or two, and rightly so. Having once been the largest automaker and largest company in the world it was also the cornerstone of American pride and industrial dominance around the globe. Generations of Americans held out GM as a shining example of American exceptionalism. So it comes as little surprise that as it declined in both product innovation and quality, as well as market share over the last quarter of it’s 100 year existence, that a social backlash has emerged.

We are never more disappointed than when our heroes fail and fall from their pedestals only to be found to have leaden feet. Ending 100 years of some of the greatest automotive and industrial successes of all time by collapsing into bankruptcy is by any measure a tragic and abject failure of the once great and all dominating General Motors. Ultimately Management is responsible for the success or failure of a corporation and so this explains the scrutiny of the Old GM Management that led us to the situation today. Now the New GM Management is charged with leading GM to a brighter new day like a Phoenix from the ashes; and so here we will examine this New GM in it’s first 100-Days and ponder it’s future.

In the famous American play ‘Death of a Salesman’ by Arthur Miller he ‘exposes the idea of tragic heroes through the fatal flaws of Willy and Biff Loman. Willy, a travelling salesman, is the father of Biff. He believes that in order to be successful, one needs to be well liked, rather than hardworking. Willy is so stubborn that he fails to see anything beyond being prosperous through reputation. Biff accepts the same beliefs as his father until he realizes that he has no direction in his life. He comes to understand that he is a failure and is willing to change’ (a).

So the real question we all want to know is whether New GM Management is like Willy, yet to come to terms with the past failings, and only feigning change while stubbornly grasping the dream of old ways? Or are they like Biff the son, having honestly realised the past failings, and ready to be remade anew?

Why the literary metaphors and contemplation of GM’s greater character and role in society? Because when you are as large as GM you are not simply a car company, you are an institution. And institutions have collective processes, staff morale, actions, attitudes and myriad individual decisions that sum to make up the whole of what we outsiders think of as GM. Heading up GM is like being President of the USA. Everyone thinks you are all powerful until it soon becomes apparent to you that your hands are bound by the constant demands or resistance from other stakeholders; ranging from middle management, shareholders, the public, customers, unions, bankers and even to sabotage from internal executive competitors.

So the test of good senior management is whether, in between catering to all these extraneous pressures upon you and your team, you find the time and wherewithal to put in place your reforms in a meaningful manner. And that they actually filter down through the institutionalised structure of the company to become reality on the ground. We all know that many GM leaders have tried to enact broad policy change before, both good and woefully ill advised, only to have marginal positive effect on the Goliath that is GM. Can this New GM Management succeed where others have failed, and if so why or why not? That is what we explore here.

Ed Whitacre and The Board

* CHAIRMAN: Ed Whitacre Jr.: The Obama Administration's Auto Task Force (ATF) announced in June that this 67-year-old son of a railroad engineer and former CEO of AT&T, was to be GM’s non-executive Chairman of the Board. This effectively split the former positions of Chairman and CEO previously held by Rick Wagoner.
* GM CEO Fritz Henderson, who succeeded Rick Wagoner in March after the former chairman and CEO was asked to step down from top spot at the automaker by the Obama administration, joined GM in 1984.
* David Bonderman, co-founding partner of private investment firm TPG in 1992, is one of the most influential figures in the U.S. private equity industry. He was a Treasury appointee to the board in July. Bonderman has experience fixing struggling businesses -- he made his name helping to pull Continental Airlines out of bankruptcy in the 1990s and turning the airline around.
* Daniel Akerson, managing director and head of global buyout at The Carlyle Group, was a Treasury appointee to the board in July.
* Erroll B. Davis Jr, chancellor of the University System of Georgia, had served on the automaker's board through the bankruptcy process and was named to the new company's board with its emergence in July.
* Stephen Girsky, a former Wall Street analyst and adviser to GM, represents the interests of the UAW healthcare trust.
* E. Neville Isdell, retired chairman and CEO of Coca-Cola Co, had served on the automaker's board and joined the board of the successor company.
* Robert Krebs, retired chairman and CEO of Burlington Northern Santa Fe Corp railroad, was a Treasury appointee to the board in July.
* Kent Kresa, chairman emeritus of Northrop Grumman Corp, had served on the automaker's board previously and joined the board of the successor company.
* Philip Laskawy, retired chairman and CEO of Ernst & Young LLP, served on the automaker's board previously and joined the board of the successor company.
* Kathryn Marinello, chairman and CEO of Ceridian Corp, served on the automaker's board previously and joined the board of the successor company.
* Patricia Russo, former CEO of Alcatel-Lucent, was a Treasury appointee to the board in July.
* Carol Stephenson, dean of the Richard Ivey School of Business at the University of Western Ontario, was named by Canada and the Province of Ontario as their representative on the GM board in July (b).

A New Role for the Board and Chairman

With only four of the new 13-member GM Board having served on the Old GM Board, and with the split of Chairman and CEO positions, this Board owes little to GM Management and is already proving to be very independent minded; the most obvious example of which being Opel.

Led by Chairman Ed Whitacre the New Board decided not to endorse a carefully negotiated deal that would have sold Opel to the consortium of Canadian automotive group Magna International Inc. and its Russian financial partner OAO Sberbank. Instead they delayed the sale so as to get a better deal. That new deal secures engineering platform and IP rights and sourcing that could have otherwise disrupted future GM vehicle programs, and may have allowed Russia-based automaker GAZ to use the technology to compete against GM in Russia and other emerging markets (c).

With fresh Board members at his back and having made his name by building regional phone company Southwestern Bell into the largest telecommunications provider in the country, snapping up the AT&T brand along the way, this 6-foot-4-inch Texan Chairman nicknamed “Big Ed” is no shrinking violet. The new Chairman also has a bachelor’s degree in industrial engineering and a reputation for killing rattlesnakes on his Texas ranch by pinning the snake with a stick and then crushing its head with a rock. Makes a nice change from GM being led only by financial accountants.

But perhaps Ed Whitacre’s greatest contribution to New GM to date is his support for Bob Lutz’ new ad campaign and spending what it will take to do the job right. This example of Whitacre's decisiveness came when he approached Bob Lutz, GM's vice chairman in charge of marketing, and asked, "How are we going to bridge this communication gap?" Lutz, who recounted the story to reporters during a recent conference call, told Whitacre, "If we do it right, it'll take a lot of money." Whitacre told Lutz: "Spend it. Go ahead." Lutz says he and Whitacre agreed: "We're not going to dribble this out of a watering can. We're going to use a fire hose" (e).

While he got off to a shaky start here on GMInsidenews.com with his comment that “I don’t know anything about cars”, Ed Whitacre has since moved quickly to become the new face of GM in the "May the best car win" ad offering a 60-day money-back guarantee. The Whitacre ad was originally slated to run only one week, but GM now plans to keep it rolling, "due to the positive response". Bob Lutz, GM's marketing chief, has said the ad tested well with consumers and he couldn't have found a better star if he'd tried (d).

Finally, a long running criticism here on GMInsidenews.com and elsewhere about the Rick Wagoner days was that the GM Board, led by Wagoner as Chairman, did little to nothing and simply appeared to rubber stamp management decisions. With Fritz Henderson not being the Chairman as well as CEO, GM's new Board has him on a very short leash. It didn't choose him, the government's ATF did, and he is under exceptional scrutiny. "He has to produce," says GM chairman Ed Whitacre. "We want him to succeed, but he's under the gun. Something has to ignite this company." Henderson seems to understand. "I think my job is always on the line, but that's okay," Henderson says. "In my case, there are no guarantees" (f).

So this proactive and involved attitude, seemingly for so long missing from the GM Boardroom, is a promising harbinger for real change. But ultimately the success or failure of this new GM Chairman and Board hangs on whether the executives, whom they are charged with overseeing and directing, can perform and execute on the new policies and strategies which we shall review below.

Fritz Henderson greeting customers at GM’s August consumer event

Fritz Henderson

CEO Fritz Henderson took the reigns of GM in March after Rick Wagoner was asked to step down. Growing up in Detroit, his dad was a Buick sales executive who worked for GM for 39 years. After the University of Michigan, where he got a degree in accounting and finance, Henderson like Wagoner graduated from Harvard Business School and then, again like Wagoner, went on to GM's New York treasurer's office. At 50, he is the third-youngest CEO in GM's 101-year history and the first to be given the job by the U.S. government.

But unlike Wagoner, Henderson’s New GM is smaller, nimbler, more focused, and less financially stretched. GM will have 34 assembly, powertrain, and stamping plants in 2010, down from 47 in 2008, and 68,500 hourly and salaried employees in 2009, down from 91,650 in 2008. It will have four brands with 34 nameplates, compared with the previous eight brands and 48 nameplates. Its overhead will also be sharply reduced with structural costs projected to decrease from $51.5 billion in 2008 to about $30.4 billion in 2010. GM's U.S. hourly labor costs have been reduced from $7.6 billion in 2008 to an estimated $5 billion in 2010 (f).

But the challenge for Fritz Henderson is not just short-term profit and loss statements but in ensuring New GM’s longer term future by bringing about a systemic cultural shift away from the former arrogant, rigid and insular ways of Old GM. The paradigm shift needed requires quick and efficient decision-making, with a willingness to take calculated risks and to move fast in a fast moving industry. Certainly Fritz Henderson, known as ‘the Machine’, has sufficient personal drive and a deep knowledge of GM. But some are concerned he has too much experience of the Old GM culture though, because his appointments have been from Old GM people and not new blood.

On July 10 Fritz Henderson announced that GM would speed day-to-day decision making by several leadership committees or boards being eliminated. Instead of a relatively large Automotive Strategy Board, Automotive Product Board and global regional strategy boards there is now one Executive Committee responsible for running the business. This leaner Committee meets twice a week. There are many benefits to such a streamlined structure, but one of the key benefits Fritz Henderson and his team hope for is quick decision making. Because issues only need to come to this one group, decisions should be made much quicker. Two examples that seem so far to have proved the benefit of this are: 1. The decision to cancel the Buick Plug-Hybrid program after negative consumer reaction from a consumer event on August 10 was made at the first Executive Committee meeting after the consumer event just four days after the event (August 15); 2. The decision to remove the GM ‘badge’ or logo from products was also made very quickly as part of a broader strategy to focus more on Brands than GM.

Led by Henderson, the Executive Committee membership includes:

- Bob Lutz, vice chairman, marketing and communications;
- Tom Stephens, vice chairman, global product development;
- Nick Reilly, executive vice president, GM International Operations;
- Ray Young, executive vice president, chief financial officer;
- Tim Lee, group vice president, global manufacturing and labor relations;
- John Smith, group vp, corporate planning & alliances, and sec. of the exec. com.;
- Mark LaNeve (now Susan Docherty), vice president, U.S. sales;
- Bob Socia, vice president, global purchasing and supply chain.

Henderson also announced at that time that:

Brent Dewar, 54, currently GME vice president, sales, marketing, and aftersales, will become vice president, global Chevrolet brand. He will be responsible for the Chevrolet brand in North America and Chevrolet brand coordination on a global basis.
Susan Docherty, 46, currently North America vice president, Buick-GMC channel, will be named general manager, Buick-GMC brands.
Bryan Nesbitt, 40, currently North America vice president, design, will become general manager, Cadillac brand.
Jay Spenchian, 50, currently executive director, marketing strategy support group, will continue in his role.
Dewar, Docherty, Nesbitt, and Spenchian will report to Lutz, effective August 1 but the most interesting of these appointments is that of Nesbitt’s unusual move from design to run Cadillac. Hopefully this indicates that design will play a large part in Cadillac’s future as it struggles to reassert it’s place in the luxury automotive landscape.

But of course, besides moving Bob Lutz to Marketing & Communications, the most significant appointment at New GM has been that of moving career engineer Thomas G. Stephens from April 1 to "car guy" Bob Lutz’ former position as Vice Chairman of Global Product Development. Stephens is an executive with no paltry credentials and plenty of his own car-guy chops. Until last year Stephens, by every account an exceedingly gifted theoretical and hands-on engineer, had devoted a substantial portion of his 40-year GM career to the company's powertrain engineering efforts.

Stephens, no pocket-protector or ivory tower engineer, has high-octane gasoline running through his veins. He has been working on and modifying cars most of his adult life and continues to do so even now as the owner of a substantial collection of GM muscle cars of every stripe, including several rare models. His career in GM's engineering empire began as a co-op student in 1969, and after graduating Stephens took his first job as junior engineer at the Cadillac Division. After various roles in experimental engineering, Stephens was named supervisor of Cadillac's product engineering in 1980 and two years later became staff engineer of emissions and transmissions. A few years later, Stephens joined the powertrain unit for what then was the Buick-Oldsmobile-Cadillac (BOC) division and was assistant chief engineer for Cadillac's 4.5-liter V8. In 1991, when the various vehicle divisions' powertrain engineering units were combined into what became the GM Powertrain division, Stephens was named director of engine engineering (g).

Another Henderson initiative involved choosing more than 50 managers to be “change agents” within GM as the company speeds up decision-making. Fritz Henderson said, “Culture change is not simple to do. In the end, if you reinforce what you want in how you behave and how you act, the organization picks it up.” The role of the change agents is to reinforce with peers and subordinates the importance of Henderson’s “four pillars” of the new GM: [1] Speed, [2] Product and Customer Focus, [3] Accountability and [4] Risk Taking. Managers and executives were chosen as change agents because they embody the behaviors sought. “You’ve got to get your people involved,” Henderson said. “You’ve got to get your leadership involved, you have to be consistent, you have to be simple and have everyone understand what you’re trying to get accomplished (h).” Whether such an initiative works will depend heavily upon how autonomous and respected those change agents are within GM. If they just hand out memos and make other staff watch PowerPoint presentations then it may have little effect. But if they lead by strong example and are seen to achieve their own departmental goals more efficiently with Henderson’s “four pillars”, they could inspire the spread of a new culture around them. Only time will tell which course of action eventuates.

Certainly Fritz Henderson is setting out to lead this example from the top by the previously mentioned rationalisation of boards and committees into the Executive Committee which meets twice a week instead of monthly to achieve his first pillar of Speed. As to his second pillar of Product and Customer Focus, New GM is putting much more into direct interaction/feedback from consumers about product. Recently GM decided to showcase their newest product and technology offering to the news media, but decided to show consumers first. They took consumers through a tour of GM's highly confidential Design Studios, where many secret new products were shown. This is not something that GM would have done in the past, and is a sign that New GM intends to be much more direct and transparent in it’s communications. Senior leaders including Fritz Henderson, Bob Lutz and Tom Stephens spent significant time interacting with consumers (see photos). The event was held on August 10 at the GM Milford Proving Ground in Milford, MI, and GM Design Studios in Warren, MI. In addition to that event in August, GM execs are staying in touch with these consumers through regular web chats. Further to this, Fritz Henderson has a "Tell Fritz" blog where consumers can interact directly with GM's CEO. As to how effective these measures are over time we will have to see, but such consumer feedback did play a role in the fast cancellation of the Buick Plug-in Hybrid.

How will history recall Fritz Henderson and his initiatives? Probably not as fairly as it should, be they effective or not. This is because he is seen as a finance/accountant person by the fans and media who will always gravitate towards to the more glamorous product and design executives who are seen as the real “car guys”. He probably realises this, but additionally that GM is also a company that needs to make a profit and pay back a return to US taxpayers. To do that there needs to be a fine balance struck between the accountants and the car guys that delivers great product profitably. And achieving that balance is the bottom line challenge for Fritz Henderson as GM’s CEO and therefore the ultimate exemplar of what a real “change agent” can be and do to turn around this historic company.

Bob Lutz talking with customers at GM’s August consumer event

Bob Lutz

Robert A. "Maximum Bob" Lutz born 1932, in Zurich, Switzerland was brought out of retirement in September 2001 when he was named to become Vice Chairman of Global Product Development for GM. On July 10, 2009, after Lutz had once again decided to retire, GM stated that Lutz will remain at GM as Vice Chairman responsible for all creative elements of products and customer relationships. In this current capacity, in addition to working closely with Tom Stephens and design chief Ed Welburn to guide all creative aspects of design, Lutz will also lead the effort to better guide GM's brands with the automaker's marketing, advertising, and communications teams reporting to him in an effort to develop a more consistent message and results (i)(j).

Having served as a jet-attack aviator in the United States Marine Corps from 1954 to 1959 (reserves until 1965), attaining the rank of captain, Bob Lutz received his bachelor’s degree in Production Management in 1961 and a further master’s degree in Business Administration in 1962, with highest honors, from UC-Berkeley. He began his automotive career in September 1963 at GM attaining senior positions in Europe until 1971. For the next three years he served as executive vice president of sales at BMW and as a member of that company’s board of management, with input into the development of the BMW 3-Series. Lutz went on to spend 12 years at Ford where he served as chairman of Ford of Europe and Vice President at Ford Motor Company. He led the creation of the Ford Sierra and initiated development of the original Ford Explorer. From 1982 to 1986, Lutz was a member of Ford’s board (i)(j).

Bob Lutz is probably best known for his previous position as President of Chrysler Corporation, where he oversaw the development of the Dodge Viper, Plymouth Prowler and Chrysler LH platform automobiles. His 12 years with the company are chronicled in his 1998 book, ‘Guts: The Seven Laws of Business That Made Chrysler the World’s Hottest Car Company’ (i)(j).

In his previous position as GM’s Car Czar, Bob Lutz championed the Holden Monaro as the Pontiac GTO; the Cadillac Sixteen Concept; Saturn Sky and Pontiac Solstice; Pontiac G8; Chevrolet Malibu; Cadillac CTS; Buick Enclave; Cadillac Converj Concept; Cadillac CTS Coupe Concept; Chevrolet Volt; Chevrolet Camaro; Chevy Beat, Groove and Trax Concept Studies; and 2010 Buick Lacrosse; Chevrolet Equinox; and Cadillac SRX (j).

Lutz detractors often criticise some of these vehicles as failing to be profitable or being a distraction when more mainstream vehicles should have been concentrated on. But they forget the original task assigned to him when he came aboard, which was to change the culture within design and engineering that needed a morale boost and to be refocused back on great design. And the best way to do that is not with mainstream commuter or family cars, but with exciting cars like the RWD Solstice, and showing that Americans can still get excited about performance RWD sports sedans like the G8 and CTS-V. These halo vehicles were not just needed to reignite excitement with GM customers, but with GM engineers and designers as well. Because of them that excitement and renewed love of design flows on into other projects that are bread and butter vehicles that are the better for it. In this regard Bob Lutz has certainly succeeded in giving GM the best pipeline of new quality product it has had in a very long time. Bob Lutz was New GM before the concept of New GM was even thought of.

Now Maximum Bob has been tasked with reinvigorating GM Marketing and the signs so far are looking good. These efforts will be discussed in the Marketing/Perception section of this editorial below.


Conclusions

So have we answered the question of whether GM is like Willy or Biff Loman from ‘Death of a Salesman’? Is GM Management yet to come to terms with the past failings, or ready to be remade anew? Well we have seen much has been done and put in place to remake GM and lead them to their hoped for New Day. However, while like in the play Willy Loman seems to have died with Old GM, leaving a repentant Biff to reshape the legacy, only time will really tell if it may once again be a case of like father like son.

Certainly for we enthusiasts it looks more promising than it does hopeless. However the proof of the pudding has not yet emerged in these first 100-Days, and in all fairness such is too short of a time to make such changes to an institution the size of GM. But I think in these fast changing and critical times in the auto industry we can say that New GM’s Management does not have the luxury of 1000-Days to pull the rabbit out of the hat. New GM’s Management must build a company that has both the promise and the demonstrated execution of a modern competitive automaker which New GM very much needs to become. If we are to grade Management efforts so far, and consideration were not given to the mess over Zeta being withdrawn from the US and the disappointment of an Epsilon II based Cadillac XTS, the grade could have been a B+; or even an 'A' if Bob Lutz had his way. But we are enthusiasts and can't ignore these RWD issues, which must drag any score down to a C+. Be we live in hope of being able to grant that 'A' score one day.

Final Grade: C+

(a) http://www.exampleessays.com/viewpaper/14553.html
(b) http://www.reuters.com/article/euDea...5873WN20090910
(c) http://www.businessweek.com/autos/au...ls_opel_t.html
(d) http://www.google.com/hostednews/ap/...AUYIgD9ARUAQO0
(e) http://www.autonews.com/article/2009...309149927/1018
(f) http://money.cnn.com/2009/09/21/news...azines_fortune
(g) http://www.autoobserver.com/2009/04/...nthusiast.html
(h) http://www.bloomberg.com/apps/news?p...d=a_6_ddqVRTH8
(i) http://fastlane.gmblogs.com/archives...ography_1.html
(j) http://en.wikipedia.org/wiki/Robert_Lutz

Picture credits: MonaroSS, GM Communications

[mikmak]

Great article MonaroSS. Hopefully the execution can meet the new direction, but of course occasionally reality will get in the way of dreams. Let's just hope that the equilibrium is met on the right side of why we actually enjoy our cars.

[appman85]

MonaroSS is by far my favorite poster.

[osv_alero]

The ending of your article states it all. It will be the products produced by those in charge that will really tell if GM has changed.

Great write up. Thanks.

[mgescuro]

Originally Posted by MonaroSS

Final Grade: C+

You're being too generous.

[mikmak]

How come MG? What is the thing that you are least satisfied with? (I'm guessing Cadillac management for a start, but where do you think they need to improve?).

[mgescuro]

Originally Posted by mikmak

How come MG? What is the thing that you are least satisfied with? (I'm guessing Cadillac management for a start, but where do you think they need to improve?).

Cadillac Scmadillac. This is about MANAGEMENT.

The problem with GM management is that everyone in power now has been at GM for a long time. They've all be promoted from within.

Who cares if Docherty is the first woman in that position at GM in its 100+ years history? It makes no difference to me. She was brought up under a culture of management ineptitude. And her experience at GM is fleeting at best, moving from project to product to division in short order and without any rhyme or reason.

The *only* way for GM to truly set things on the right path is to ELIMINATE all mid-high level managers and executives and start over again. What we have seen is an elimination of management fluff. Only to promote these same managers' direct reports into the same position.

That's a perpetuation of the same poor management style and decision making that led to GM's catastrophic downfall.

I would give no higher than a D+ for GM Management overall. I would give an F, it wasn't for the fact that Whitaker put all of GM management on notice. Shape up Now. Our you will ship out shortly thereafter.

I'm patiently waiting the shipping out part. Cause it is coming.

Then we can start talking C+ or higher.

[Bravada]

Marc, I am no defender of the RenCen culture, and I was quite disappointed myself to see so little change at the top, but aren't you overly biased here? I would be seriously surprised here for those guys to go from Dr Jekyll to Mr Hyde overnight, but you have to judge them on merit, not the past. The fact is that they are clumsily improving, even if a far cry from the dramatic shakeup GM would need the most.

[mgescuro]

Originally Posted by Bravada

Marc, I am no defender of the RenCen culture, and I was quite disappointed myself to see so little change at the top, but aren't you overly biased here? I would be seriously surprised here for those guys to go from Dr Jekyll to Mr Hyde overnight, but you have to judge them on merit, not the past. The fact is that they are clumsily improving, even if a far cry from the dramatic shakeup GM would need the most.

BIASED? Absolutely not.

GM went bankrupt. A company that was once the largest, most revered in the world filed for bankruptcy.
Do you understand what bankruptcy is?

GM failed largely due to management failure.
So.... why is the same management still in charge??

In this economy... with this level of better funded, better equipped competition... "clumsily improving" is unacceptable.

The fact that there wasn't a dramatic shakeup at GM post-bankruptcy, should have raised red flags. Period.

You need to start questioning WHY management has been allowed to stay.

[mikmak]

I would guess the reason they are still there has to do with being able to steer the company out of the muck. I agree that there is a clear line of sight from BK to the boardroom, but could you imagine the chaos that would ensue with a completely new board?

I can definitely see the danger of internally promoted members getting overwhelmed in their new role and potentially reverting back to old ways, should they be unable to resolve a new way to do business, in accordance with New GM policy (which I assume exists).

However, the other option is having a brand new executive, not aware of the full capabilities of their resources to overcome that same hurdle. The result would be zero progress or expenditure for something the GM already has in its empire.

Both of these instances can be circumvented by internal communication of the problem and collective input to a new solution, but you need to have ideas from people who know how the empire is operated right now.

For example: Market research has indicated that Buick customers want an automated blue rinse/hair dryer system in their full sized car.

Exec A (a new import from outside of GM) recommends that systems engineering get to work straight away on developing an entire system to satisfy customer needs.

Exec B (a promoted exec from within GM) recognises the similarity between the new demand and the blowdryer/autoperm module currently available in the Buick Park Avenue and orders engineers to integrate the blue rinse function into the blowdryer/autoperm and transfer it to the NA Buick model.

Both end up satisfying customer needs, but the greater understanding held by exec B means Buick will now have a Bluerinse/Autoperm Blow dryer that was developed at lower cost yet provides more functionality.

The execution of New GM policy is obviously going to be the key indicator of whether or not the old dogs have been able to learn new tricks, but in the current climate, it is still important to be able to carry on with core business. As you say though, the actual "shipping out" part of the "shape up" arrangement should certainly be applied where a resistance to change is identified. I just don't think that time is now.

[mgescuro]

Originally Posted by mikmak

I would guess the reason they are still there has to do with being able to steer the company out of the muck. I agree that there is a clear line of sight from BK to the boardroom, but could you imagine the chaos that would ensue with a completely new board?

That's why a company enters bankruptcy. To sort out the chaos.
That's why when most companies enter bankruptcy (the traditional way) or when a company is acquired, the execs usually begin "interviewing" for their position. Justify your position with the company and why you deserve to stay.

Remember, it is the internal culture of GM that proves to be its biggest hindrance. Destroying the management hierarchy that has allowed the culture of ineptitude to persist is the only way to destroy the culture and rebuilding in a new mold.

A company enters bankruptcy to fix itself and shake itself of what crippled it before. GM is still just adding bandaids. Nothing is really being fixed.

Originally Posted by mikmak

I can definitely see the danger of internally promoted members getting overwhelmed in their new role and potentially reverting back to old ways, should they be unable to resolve a new way to do business, in accordance with New GM policy (which I assume exists).

Ok.

Originally Posted by mikmak

However, the other option is having a brand new executive, not aware of the full capabilities of their resources to overcome that same hurdle. The result would be zero progress or expenditure for something the GM already has in its empire.

No. That doesn't happen in real life. Any decent manager would come in and assess the situation. Especiallly if axing managers manages to flatten the organization. It becomes easier.
Instilling anew culture of openness and one with an open door policy will allow new manager to quicker guage the environment.

Originally Posted by mikmak

For example: Market research has indicated that Buick customers want an automated blue rinse/hair dryer system in their full sized car.

Exec A (a new import from outside of GM) recommends that systems engineering get to work straight away on developing an entire system to satisfy customer needs.

Exec B (a promoted exec from within GM) recognises the similarity between the new demand and the blowdryer/autoperm module currently available in the Buick Park Avenue and orders engineers to integrate the blue rinse function into the blowdryer/autoperm and transfer it to the NA Buick model.

Exec A would call a meeting of his/her directs. Through this session, s/he would discover a similar system already in place at Buick. HE would then get that system engineered for the new Buick, but also find a way to integrate it into all Buicks.

Exec B would call a meeting to discuss whether or not customers really need this module. They would discuss for about 2 months. Finally, they would come to the consensus that more info is needed and commission another study on blow dryers. 1 year later, he discovers that indeed, the market really does want the blow dryer. And he orders a new blow dryer engineered. Another year later, they have the new blow dryer, only to discover that it only works in American Buicks. So they get busy working on an exportable blow dryer. But while doing that, they start another study to see if international customers want the blowdryer. Another year passes by, and they find out that they do. So now they have 3 blow dryers. And then they realize they realize they completely forgot about the autoperm module. ANd the cycle repeats.

Sorry. ButYou KNOW that's the REAL case with Exec B. How else would you explain the crappy spin job as to why CTS never got push button start!!!??

[mikmak]

Nice.

[MonaroSS]

Originally Posted by mgescuro

Cadillac Scmadillac. This is about MANAGEMENT.

The problem with GM management is that everyone in power now has been at GM for a long time. They've all be promoted from within.

Who cares if Docherty is the first woman in that position at GM in its 100+ years history? It makes no difference to me. She was brought up under a culture of management ineptitude. And her experience at GM is fleeting at best, moving from project to product to division in short order and without any rhyme or reason.

The *only* way for GM to truly set things on the right path is to ELIMINATE all mid-high level managers and executives and start over again. What we have seen is an elimination of management fluff. Only to promote these same managers' direct reports into the same position.

That's a perpetuation of the same poor management style and decision making that led to GM's catastrophic downfall.

I would give no higher than a D+ for GM Management overall. I would give an F, it wasn't for the fact that Whitaker put all of GM management on notice. Shape up Now. Our you will ship out shortly thereafter.

I'm patiently waiting the shipping out part. Cause it is coming.

Then we can start talking C+ or higher.

Mate,

You are making wild assumptions about corporate culture, like these people are not real human beings, but some type of automatonic lemmings.

So you must agree with everything your boss does? You have never found yourself secretly critical of your superiors decisions at work and telling your family/friends "if I were in charge I would never do that"?

By your assessment of how the world works you should never be promoted to your boss’s position unless the company wants his management style 100 percent replicated. Because according to you, you are incapable of being anything other that what your boss has been because you have reported to him.

You must be nothing more than an amalgam of all the bosses you've worked for, with no independent thinking and reasoning capacity of your own....

[Bravada]

You are making wild assumptions about corporate culture, like these people are not real human beings, but some type of automatonic lemmings.

That's GM - you know that assumption is not totally far off.

Ford was ran by Marketing Idiots @ Ford (TM), Chrysler by a bunch of lunatics ran amok, and GM by some type of automatonic lemmings. I guess we've just nailed down the corporate cultures that drove Detroit down.

[mikmak]

Or, more accurately, the precedents. One event that can turn things around is a big poke in the eye (or wallet). BK surely has served some purpose and will generate an appropriate response from those involved. A willingness to believe that past errors will be repeated is often that which stifles progress. Of course the next few critical months and years should not pass with out criticism, but aiming criticism for actions that are yet to occur is just as detrimental as failing to monitor progress.

As the saying goes,

People saying it cannot be done, should not interrupt those that are doing it.