GM Chairman Scares Execs With Actual Expectations
Fritz Henderson got a thumbs-up from the Board of Directors just days ago, but it seems that Chairman Ed Whitacre doesn’t want anyone to get comfortable. The Freep‘s Tom Walsh just posted a column describing GM execs as “rattled” by Whitacre’s recent revelation that at the New GM executives must earn their keep.
On Wednesday, Whitacre told a group of GM salaried staff — in one of several “diagonal slice” meetings, so called because they mix people from all levels — that he expects to see lots of changes in the next 12 weeks. Changes every day.
So, is the party over? Surely GM’s brass knew that there would be some accountability, someday. Right?
‘I found it stunning,’ one GM executive told me Thursday, after hearing that Whitacre had spoken so pointedly to the employee group about the urgency of producing visible changes in 12 weeks . . . Another GM officer described Whitacre as ‘frighteningly direct’ in conversation, making it clear that every top executive’s job at the automaker is on the line, and that heads could roll in the next two or three months if there’s not significant progress in vehicle sales, market share and profitability.
Stunning? Frighteningly direct? Whitacre is merely doing the minimum required to get GM ready for an IPO planned for next summer. The White House wants out of GM, and the UAW would probably like to dump its equity as well. But who’s going to buy in if GM doesn’t radically turn itself around over the next 9 months?
And really, how are they going to turn sales and market share around? The problem with Whitacre’s scare-’em-into-competence approach is that all the incentive is to make GM look good in the short term. Which means temptation to cut corners on long-term strategy to pull off the IPO. The terrified reaction to Whitacre’s tough talk proves that GM culture change hasn’t changed. Will turmoil and turnover at the highest levels right now really make a difference in time for next Summer’s IPO?
The IPO delay watch begins now.
More by Edward Niedermeyer
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CarPerson: What in the heck does a 90 degree V6 have to do with anything? GM made plenty of good 90 degree V6 engines and still does. The problem is car build quality and interior materials for folks who chose foreign over domestic designs. On the scare: I buy texlovera's explanation. This is dynamiting at the top level of GM, with a 90 day fuse. I want to see GM survive, so I hope he pulls it off. In my opinion, the only way for that to happen is that most of the top level of GM hits the road, permanently (at least the road out of GM). I also tire of TTAC's downplay of any move at the top. GM is damned on TTAC if they do, damned if they don't. First TTAC condemns no movement, then condemns any movement. One could say TTAC just damns GM! (which I actually believe to be the real truth about it).
Flat and inline six cylinder engines are inherently a balanced design. A six cylinder V-configuration is not. It takes one, if not two balance shafts and crank trickery to achieve 120-degree firing to smooth them out. Start with a 60-degree design and half the battle is won. Starting with a 90-degree V6 design, usually the product of engineering shortcuts and machine tooling limitations, spells defeat at the get-go as General Motors is loathe to spend the money to design and build a 90-degree V6 engine properly. In the early ’60s Buick sold a 90-degree V6 that had the rocker covers bouncing off the shock towers it shook so bad. GM’s solution? Soften up the motor mounts. If General Motors wants to push crap out the door, the MSRP needs to take a healthy wack for every stunt they pull to balance the transaction.