Today's New York Times has a very encouraging article about the cultural and organizational changes that are happening at GM in the wake of their bankruptcy. I was simply delighted to read about changes like this, where GM is finally beginning to tackle what Jeff Pfeffer and I call "The Otis Redding Problem."
In the old General Motors, employees were evaluated according to a “performance measurement process” that could fill a three-ring binder. In
Terry Woychowski’s case, for example, his job as director of G.M.’s
vehicle engineers was spelled out in exhaustive detail, and evaluated
every three months. But in his new job as vice president — a
promotion he was given 20 days after G.M. emerged from bankruptcy — his
performance review will be boiled down to a single page, something he
had never seen in his 29 years with the company.Mr. Woychowski
said he felt the grip of G.M.’s legendary bureaucracy start to loosen,
something he never imagined possible. Now, such reviews are being
scaled down and simplified across the company. “We measured ourselves ten ways from Sunday,” he said. “But as soon as everything is important, nothing is important.”
As regular readers of this blog may recall, last November, I wrote a rather scathing post on GM's "no we can't mindset" in which I argued that GM's core competence seemed to be coming-up with reasons about why the couldn't stop doing seemingly dumb old things and start doing seemingly smart new things. I provided quite specific suggestions that stemmed from my now nearly 30 years of intermittent contact with diverse parts of the company. I am not especially good at figuring out the impact of different posts, but from the number of page views, number of comments, and the strength of the emotional reactions to it, I think this post had more impact than anything else ever written here. This Times article suggests that they are making real progress and committed to making more.
In that spirit, I have a pet peeve that I have been complaining about openly and repeatedly to GM managers and executives about for years. This is a change I believe they can and should make immediately, and that will help reverse two of GM's biggest cultural problems:
1. Management and senior executives don't quite understand and are insulated from the experience of owning and buying a GM car — and how it stacks-up against their competitors.
2. They think and act like too much like they are just selling cars, when in fact, they are selling a car ownership experience — yes, the car itself is an important part, but there are many other parts such as shopping for a car, buying it, having it serviced, and so on that are treated as separate and less important.
To me the single most destructive thing they do to themselves is to have a program — one they still have — where managers and executives are given a free GM car to drive. I have heard a lot about bits and pieces of this program over the years, but I confess to not knowing every detail. My understanding, as I wrote last November, is that it goes something like this:
GM has a perk for managers down to fairly
low levels where all are given a GM car to drive – they rotate from one car to
another. I am not sure of the exact details,
but answers to the questions I’ve asked over the years suggest it goes something like this: the
lowest level managers have to buy their own cars, the ones at somewhat higher
levels get a new car to drive every six months or so but have to do some
servicing, the managers who are somewhat higher-up get somewhat fancier cars and are freed from any servicing (gas
is even put in the cars of some executives so they don’t have to go to the
service station), and the highest level executives get a car and a driver.
In other words, this system effectively
insulates people in management – especially those in senior management — from
experiencing what it is like to shop for, bargain for, purchase, service, and
sell a car. They only get the driving experience. Well, except for the most
senior executives, who don’t even get that experience — they watch a person in
the front seat drive a big car. Now, it
is true, that the most senior executives do own GM cars for personal use, but
it is my understanding that when a car is delivered to a senior executive,
special attention is devoted to the car – even during the production process –to
make sure the top brass aren’t exposed to a car with any flaws. Wouldn’t that
be nice?
Here is my challenge to GM, and frankly, since you are running on U.S. taxpayer money, my money and the money of millions of us who would rather see the money going to things like education, I think that you owe to us — and yourself — to do the right thing:
1. Get rid of the program immediately.
2. Use the money spent on the program (even though I know it won't have the tax advantages of the old program) to give each manager and executive money to help buy a car for work — they only get the money if they buy a car.
3. Get rid of the GM employee discount program completely, so that when managers and execs walk into a GM dealer, they have to do the same negotiation as everyone else.
4. Stipulate that not only can people buy non GM cars, only 25% of those participating in the program at any time can own a GM car. That way, there will be information in the company about the experience of owning a wide range of cars.
5. Everyone — from the CEO on down — will be required to partake in the full car ownership experience, from selecting, to shopping for, to servicing, to getting gas, to selling and trading in their cars.
There are a lot of other things about GM that need to change — or more optimistically — perhaps are already are changing. See this amazing story provided by Matt May about how badly their managers sometimes listen. But I believe that this single change will have a large and positive impact, forcing GM management and executives to break out of their isolation, to learn about competitors' car and car buying experiences, and to come to grips with what the GM ownership experience actually entails.
Dear GM Executives: you know these problems exist, you know that this program contributes to these problems, and you are at a juncture in your history where change is possible. Why can't you end this program immediately? Rather than falling back on your old core competence of explaining why it is impossible for you to do the right thing, how about showing the American taxpayer and yourself too that it is possible for you to do the right thing and to do it fast?