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Goldsmith Group Editorial Press release:
The Real Problem at General Motors
Once again, GM in the news for all the wrong reasons. The company failed to alert its Cobalts customers their was a major problem with its ignition switch. The company learned of the seriousness of problem back in 2001, 2004 and 2005. GM made the decision to do nothing to correct the situation, instead it turned a blind eye to the seriousness of the problem. As a result, 13 deaths and 31 crashes have been linked to the cars flawed ignition switch.
GMs Chief Executive Officer Mary Barra told congress GMs failure to correct Cobalts problems was a result of its culture. Ms Barra went on to explain, that before she became CEO, GM had a cost driven culture and now its culture was customer driven. Barra wants congress to believe that kind of thing would no longer happen under her leadership and the new culture he has instilled. I am not buying it.
Barra claims she knew nothing about Cobalts flawed ignition switch until shortly after she became CEO, even thou she has been in leadership positions for years. I believe her. When asked by Senator Boxer (D Calf.) how can this be? Barra response was “There were silos, and as information was known in one part of the business, or the legal team, it didn’t get communicated to the engineering team,” This tells me that GMs problems go much deeper then just having a cost driven culture.
She became CEO on January 15, 2014, and under her leadership she wants people to believe in just over two months GMs culture has now magically changed and problems like these could no longer occur. The fact is, that so far this year GM has recalled nearly 7 million of its cars for various problems. Barra would have us believe the recall was because she changed the culture at GM and not because of pressure from government agencies and congress demanding that something be done. I am buying it.
One of the biggest enemies of decision making and problem solving is denial. Accepting what is really happening in GMs case has been one daunting task. After all this is the same company that brought us the Chevy Silverado (and other trucks) with the tailgate problem from 1999 -2004, the Buick LaSabre (17 other models) with unprotected engines, the Oldsmobile Cutlass (eight other models) with the suspension system problems, the Chevrolet Bel-Aire (15 additional models) with motor mount problems. Totaling almost 20 million recalled cars. Whose former CEO flew to Washington in a private jet in 2008 to ask congress for billions of bailout dollars to save GM from failing without bring a business plan.
GM needs a leader who will create a cultural that values honesty, listening to it employees, accepting straight forward feedback, and admit when mistakes are made. Most, GM must be willing to solve their real problems head on when they first appear and take the required action.
If GMs new CEO believes she has already changed GM from a cost drive culture into a consumer driven culture will solve GMs problems, she is living in LALA land.