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A House subcommittee investigating General Motors Co.’s deadly ignition-switch fiasco isn’t necessarily buying what CEO Mary Barra is selling.
She used the first stop in her second round of Capitol Hill hearings Wednesday to detail the depth of GM’s serial incompetence and her response to it. She touted the appointment of a new safety czar, the hiring of 40 new safety investigators, a restructured recall process to now include senior executives, the firing of 15 people as evidence the automaker’s culture is changing.
It’s not that easy. Not five years after GM collapsed into bankruptcy. Not for the fifth CEO in as many years. Not for a company whose own internal investigation, released in all its gory and discomfiting detail, shows that GM engineers were aware of the dodgy switch a dozen years ago but failed to connect it to malfunctioning air bags implicated in at least 13 deaths.
“Aren’t the cultural problems more far-reaching than firing 15 individuals,” Rep. Bruce Braley, an Iowa Democrat, asked as he described a “culture of irresponsibility at GM.” Yes, sir, they are.
“It sounds like the old GM’s culture was, ‘Let’s not talk about problems,’ ” Rep. Gene Green, D-Texas, said before he fingered one of the elephants in the room: namely, Barra, most of her leadership team and her vaunted new global safety VP, Jeff Boyer, are GM lifers proposing to lead a sweeping culture change that eluded their predecessors, to the extent they tried at all.
“You need a culture change and not just verbiage,” Green said. Amen.
In the we’ve-been-there-before category, here was another GM CEO managing a self-induced crisis sitting, once again, before a congressional committee and fielding questions laced with distinct skepticism: How can leadership reared in the ways of GM successfully lead the kind of change even bankruptcy failed to deliver?
It’s an absolutely fair question given GM’s hidebound history, its resistance to change, its collapse into Chapter 11, its track record the past five years of touting the arrival of outsiders at high-level positions only to see them later expelled by GM antibodies protecting their host. Imagine that.
Barra and her leadership team may bridle at skeptics questioning whether they’re the ones to lead change; they may point to the success of GE lifer Jack Welch, whose leadership transformed General Electric Co. into a global powerhouse benchmarked around world; they may argue they are uniquely qualified to lead a transformation because they know the company.
But they cannot deny, as several members of Congress insinuated Wednesday, that the only way to judge the progress of a promised cultural revolution at Detroit’s No. 1 automaker will be to measure actions — and the quicker the better, as GM Chairman Tim Solso suggested in a recent interview with The Detroit News.
Barra, product chief Mark Reuss, General Counsel Mike Millikin, purchasing head Grace Lieblein, among others, didn’t survive a decade of restructuring, the bankruptcy bloodletting, two Washington-imposed CEOs, an initial public offering and the end of government ownership by pushing too hard against the establishment or by playing corporate bomb-thrower.
They walked the corporate tight-rope of delivering results and playing the game, of knowing GM’s cultural nuances and finding ways to exploit them. Now, they’ve set for themselves the enormous task of leading more than 200,000 people in an effort to break the worst bad habits of the past and present.
“The failures at General Motors were ones of accountability and culture,” said Rep. Tim Murphy, the Pennsylvania Republican who chairs the Energy and Commerce subcommittee on oversight and investigations. “If you haven’t changed the people, how do you change the culture?”
He doesn’t know the half of it. The company’s cultural ticks extend far beyond the “GM nod” and the “GM salute,” empty gestures designed to feign agreement even as they off-load responsibility. Instead of removing underperforming managers, GM routinely demoted them into lower-paying positions with less august titles, creating chokepoints that slowed advancement for more ambitious types.
It ignored whistle-blowers, as Bloomberg Businessweek reported, moving them into less desirable jobs and into early retirement. It policed language, lest flippant words become weapons in product liability cases, and ascribed ignition-switch malfunctions to “customer inconvenience,” not safety problems warranting deeper investigation and recall.
Its legendary bureaucracy, a portion of which is exposed in all its absurdity by the 315-page Valukas Report, burned time, management focus and precious product development resources. Barra would know: she headed global product development the past three years, chiefly charged with streamlining a process her predecessor deemed hopelessly counterproductive.
GM’s cars and trucks are considerably more competitive, and its operations more profitable, than just five years ago. But the ignition-switch fiasco underscores just how far Barra & Co. have to go to demonstrate they are making progress.
“I never want anyone associated with GM to forget what happened,” Barra told the committee in her opening remarks. “I want this terrible experience permanently etched in our collective memories. This isn’t just another business challenge. This is a tragic problem that never should have happened.”
Except that it did. Fixing processes and firing 15 are a start, but the hard work of truly changing GM’s culture, a perennial lament, carries no guarantee of success. Why would this time be any different?
Daniel Howes’ column runs Tuesdays, Thursdays and Fridays.