GM, Ford, DCX: Big Three IPhone Home?
According to yesterday's Yahoo finance, Apple juice is the Detroit’s drink of the moment. Mark Fields, FoMoCo’s Prez Del Americas: "I admire their pure understanding of the brand and the type of customer they're going after.” Mark LeNeve, GM’s Veep of SS&M (Sales, Service and Marketing): "We're really trying to be more like companies like Apple, where we can innovate and move faster.” Eric Ridenour, COO of the C in DCX: "I think a fresh, creative mind is something that you can appreciate and focus simply on some complicated things." While the Big Two Point Five’s top execs are happy to sing the praises of the iMac, iPod, Apple TV and iPhone, it's lip service. They’re unwilling to learn the true lessons of Apple’s recent success.
Apple Lesson Number 1: Revolution, then evolution
When Steve Jobs returned to ailing Apple, he cut product lines into three core offerings, cut hardware licensing agreements with third party vendors, replaced Macintosh’s Operating System and orchestrated the ouster of the company’s CEO. AFTER Jobs consolidated power, stopped the bleeding and banked some cash, the company expanded its product line. Apple was then in a position to take a chance on a “game-changing technology” like the iPod. And keep improving it on a regular basis.
“GM expects the Chevrolet Volt to be a breakthrough product.” Uh, I don't think so. Although GM has no shortage of engineering expertise, GM is far too sick to realize anything even half this ambitious. Unless the company transforms itself, it will not survive to see its electric cars wean Americans from Arab oil.
Detroit’s pattern of gradual tweaks to the status quo will not rescue the languishing leviathans. They must cut or sell superfluous brands, focus product lines, restructure supply and labor contracts, and defenestrate the senior managers whose neglect drove these once great companies into the ground.
Apple Lesson Number 2: Lead from the front
The Yahoo article counsels the domestics to imitate Apple and focus on customer appeal. This Apple does not do. It doesn’t conduct customer clinics to ask specific demographic groups whether they like a potential product. It doesn’t float trial balloons; unveiling new ideas to trade show audiences YEARS before they begin production. Apple creates something inherently appealing and builds it.
At best, a fast-acting auto manufacturer needs three years to move from concept to production. By the time a new Camaro– sorry, car comes to market, the customer survey data it’s based upon has expired. AND it’s old news. If automakers want to live on the cutting edge, they must lead their customers. They must abandon auto show onanism and unveil complete and completely radical new products, coming to a showroom near you in months, not years.
Apple Lesson Number 3: Put the visionaries in charge
Steve Jobs surrounds himself with top-drawer creative engineers that propose far out new technologies. When he sees a product that appeals to him (that conforms to his strategic vision for the company), Apple makes it.
A former CFO runs GM. A former airplane designer runs Ford (or not). A productivity genius (or not) helms Chrysler. While there are plenty of “car guys” charging around Detroit’s halls of power, they’re not in charge. No car guy would ever green light a Pontiac Aztek, Jeep Compass or Chrysler's new Sebring.
Apple Lesson Number 4: The brand isn’t everything; it’s the only thing
In general, Apple has stood by its brand identity and product naming conventions since it began business. The iMac started as a Bondi blue colored jelly bean-shaped computer. The name remained through numerous motherboard revisions and a LifeSavers roll of colors. Later, Apple repackaged the iMac as a floating flat screen design. Today it is the all-in-one unit. Throughout the configuration changes, Apple products have retained their identity as quirky yet reliable, user-friendly (yet expensive) computer-related products.
Mark Field’s paean to Apple’s “pure understanding of the brand” is a strange observation for an executive whose company has neglected and abused both brands (Lincoln, Mercury, Jaguar) and models (Town Car, Cougar, S-Type) for decades. At the same time, GM is happy to slap the Caddy badge on a pickup, and Chrysler builds so many different products at so many different price points that the name has become virtually meaningless.
Let's do the math. Of the all the US nameplates Toyota produced in 1996, 55% are still for sale, including the continuation of the Camry’s 24-year run. Fifty percent of Honda's model names also extend back to that date. That’s a stark contrast with Chevrolet (13%), Pontiac (17%), Buick (0%), Cadillac (0%), Ford (23%), Mercury (17%), Lincoln (33%), Chrysler (40%) and Dodge (34%).
“If I only had a killer car, then I'd be as meteorically successful as Apple,” bleat The Big Two Point Five. Nope. If they were healthy companies with product guys at the helm, unwaveringly focused on the long-term development of their products, then they’d be prepared to seize upon new technologies and develop insanely great products– just like Apple.
[Read the original Yahoo Finance article here.]
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