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“The more you want people to have creative ideas and solve problems, the less you can afford to manage them with terror.”

Daniel Greenberg
Chairman, Electro Rent Corp.
Newsweek, 4/25/88

“American management, in the two decades after world War II, was universally admired for its strikingly effective performance. But times change. An approach shaped and refined during stable decades may be ill suited to a world [of] rapid and unpredictable change, scarce energy, global competition for markets, and a constant need for innovation.”

R.H. Hayes and W.J. Abernathy, Harvard Business Review, July/Aug. 1980.

I told myself I was not going to write about GM, even though I spent eight years there, writing speeches for top execs. The company has enough problems right now without one more insider venting his spleen. Besides, it’s already been done, by my fellow speechwriter, the late and beloved Al Lee, who did a character assassination of the CEO I worked with; the book (Call Me Roger) sank without a trace.

But now I have to, because I read the heartrending story of Donna Gilbert, whose body was wrecked by a crash caused by a flaw in GM’s ignition system (“Woman journeys back from car crash,” Keene Sentinel, Apr. 27, 2014; by-lined Chris Mondics, The Philadelphia Inquirer). The company knew about it – for years.

I tried to stay out of it emotionally, even though this latest ignition scandal and cover-up have, incredibly, driven liberal Michael Moore — who’s hated GM for 30 years, ever since they ruined his idyllic home town, Flint, MI — to advocate capital punishment for the people at GM who let it happen!

Roger and Me

I was at GM when Moore made his first docu-epic, Roger and Me. One of my speeches made it into that movie, with the CEO delivering warm, fuzzy Yuletide thoughts, interspersed, by Moore, with shots of a sheriff evicting people in, of course, Flint.

Donna Smith spent 15 days in a coma. And people are wondering why. Does GM have a culture of cover-up? Not exactly.

Arrogant and infallible

It has a culture of arrogance and infallibility. Nobody remembers when GM was America’s industrial colossus. It owned HALF of the North American vehicle market! There was talk, early in the 20th century, of breaking it up.

Those were the days, my friend! We thought they’d never end. But they did. I was on board for the last of them, and nothing beats the corporate jet for travel convenience.

The “GM can do anything” mentality was very strong. But this attitude hides a fatal weakness: the inability to admit error.

The company was deaf in both ears as far as PR was concerned. Their attitude toward PR Staff was old-school: “Don’t you guys take reporters out to lunch so they’ll say nice things about GM?”
I’ll bet there was no high-level PR counsel at those executive meetings where the ignition thing came up (if ever it did), nobody to say, “Fix this problem NOW, before anything else goes wrong, admit the truth, pay off all legitimate claims, and be done with it.” Much better in the long term. So basic.

Passive recalls

To deal with endemic problems, GM (and the other companies, no doubt) sometimes practiced “passive recalls” (my term). I once found myself in a long line of cars outside a Detroit-area dealership (BTW, to buy anything other than an American car in Detroit was social treason).

The cars all had the same problem – window washer pump failure. The thing had been positioned too close to the engine heat and would easily burn out if the washer tried to run on empty.

The dealer fixed this and was paid back by GM from a “Policy and Warranty” fund, i.e., fix the problem which we should have anticipated when we designed the car.

Bossocracy

The other piece of it, along with the success/infallibility culture, was a militaristically rigid authoritarian management consensus. One exec I worked with made a point of telling me he had a meeting with “my boss” – and he was the 2nd highest executive in the company. Even at these exalted levels, the authority structure must be recognized.

What this means for the ignition debacle was that, at the lower and mid-levels, “the boss doesn’t want to hear about it.” That simple. Doesn’t look good. Affects profits. Nobody dared say, “Fuck it, somebody almost died, he HAS to hear about it.” That was not the GM I knew.

Haunted

So yes, they’ve shot themselves in the other foot. Screwing up solid market leadership to the point of bankruptcy, being publicly owned (Roger would have loved that – NOT), starting to earn money again – and now this. Haunted by the old GM.

Arrogance, infallibility, rigid command-and-control: these are not humanistic virtues, even though most of these men, and they were men, were no doubt regular churchgoers.

There may be companies where these inhumane behaviors are not practiced. But as far as I can see, they spelled the downfall of GM.

6 Responses to “Oy, vey! GM shoots itself in the other foot.”

  1. on 09 May 2014 at 4:58 pmRich

    Things started changing in the late 70s. Continued in the 80s. Accelerated in the 90s. Crashing in the Oughts.

    I really noticed in the 90s. At Great Lakes & beyond, tons of Sailors were forced to retire w/o benefits after 15, 16, 17, 18 years. Cost cutting.

    I went to ceremonies. Weeping wives, troubled kids, guys with gold (perfect record) stripes down their arms stunned.

    Contractors poured in to replace CivSvc. Honchos, mil and civ, spoke in jargon, cheered the latest mgt scams, intoned reverently of tycoons.

    Officers became candid Climbers. Flag officers piously pledged faith to their commands, while wangling post-retirement sinecures w/Contractors.

    In the private sector, CEO “compensation” rose tenfold-plus from the 60s, as millions lost jobs. WallSt operators bought sold then trashed huge companies, in the process filching retirement monies.

    Our leaders left us. Replaced by PR types (ever been to a Ragan Seminar?) portrayed by Martin Short on SNL.

    Rush & Rummy said “Fear is good! It motivates.”

    Books continue to be written. The synechdote for me is Brooksley Born, head of a US financial regulator under Clinton.

    She saw fishy stuff going on with hedge funds, funny new “financial instruments”, $10s of B’s in opaque money.

    She began investigating. Her subjects called DC. She was called to an Oval Office meeting w/Clinton, Summers, Rubin, Geitner.

    They told her to lay off, and soon forced her out. LTCM collapsed a few weeks later. Greenspan feared the worst.

    That was 15 years ago. Nothing was fixed, things have gotten worse. Same leader cabals.

    “Without vision [and leadership] the people perish”. I think it’s Bible, and Bush 1 said it.

    I peter out.

  2. on 10 May 2014 at 1:15 amAlan

    Thanks for filling in the sad chronicle. Shows that corruption and cover-up are everywhere - GM just got caught.

  3. on 10 May 2014 at 1:09 pmRich

    Glad you liked my tale of woe. The concatenation of corruption & duplicity grows ever longer. I hate to say it.

    I’m a guy who joined the Army in 66, was tickled pink as GS-4 serving my country, wrote 20 years of patriotic speeches attributed to others.

    I still love America. Inherently and strongly. Plus, where else am I gonna go?

  4. on 10 May 2014 at 1:12 pmRich

    Oh! Martin Short played the chain-smoking, perspiring Mr. Thurm.

    I love Short.

  5. on 11 May 2014 at 12:12 amAlan

    He also had the name “Tommy Flanagan” (same name as an eminent jazz pianist, it turns out).

    Short is a hugely versatile and energetic fat John Candy/Chris Farley comic in a small body, as he proved with the manic Ed Grimley and, of course, Jeremy Glick.

    I love the idea of liberty. My country today, not so much. Franklin (I think) to Paine: “Where there is liberty, there is my country.” Paine: “Sir, where there is NOT liberty, that is my country.” (Hope I got that right - you’ll correct me.)

  6. on 11 May 2014 at 12:57 amRich

    Tanks for permission to be a smarty pants.

    John Lovitz was Flanagan. Also “Actor”, the Devil, among other delights.

    Martin also did a Killer Katherine Hepburn grand-nephew. He’s the most beloved comedian of his peers, by his peers. (Mr. Thurm is on YouTube)

    Odd he isn’t Huge. The Love of his Life, his wife, died some years ago. Kids are grown - they love him. All that love must help him endure.

    Bought Irish Creme at Aldi’s today. The v young lady Carded Me! Must be store policy. It’s a German Co. 11 y/o’s drink wine there.

    Boy, I cry a lot lately more. Older men do. Newest impetus, “Don’t Worry Now” (sp) by Dire Straits on YT. It’s an adult lullaby.

    “Fargo” series on FX is terrific. Also “Vikings” on History Channel. Actor for Ragnar Lothrock looks like Brad Pitt.

    A number of my Followers are in despair. I try to comfort them.

    Consider. Freedom is incredibly Rare. Probably not suitable for most people. Socrates believed so.

    Whew. Finally recovering from Monster Flu. How you?

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