Detroit. Now that the lesser lights in the media have dialed back – at least somewhat – from their drooling “Mary Barra is the Greatest Thing Since Sliced Bread” phase, can we now get down to the business of the business? Oh, wait a minute, I neglected to mention the recent news that Fortune magazine just named Ms. Barra “the world's most powerful woman in business” in its inaugural list of the 50 Global Most Powerful Women in Business.
Exactly why the editors of Fortune did that is difficult to ascertain, as the reality for GM is that it hasn’t been that long since it was on the mat and down for the count in bankruptcy, and it is certainly not the most powerful global force in business by any stretch of the imagination. But such is the nature of the media these days - everyone gets a gold star and/or endless accolades just for showing up or being in the right place at the right time. And this situation is no different.
But now that the victory laps are winding down, what exactly is Mary Barra going to bring to the table? And excuse me, but maintaining the course as set up by the dearly departed Captain Queeg – there will be no “right or left turns” as Barra has gone on record to say at almost every opportunity - isn’t going to cut it.
Other than the rejuvenated product story - which Akerson had zero to do with, let’s not forget - the news for GM isn’t all that great. The situation in Europe is still a mess and a giant financial sinkhole, and assuming that stabilization is on the horizon or that the profit picture there will just come into focus is an assumption that just doesn’t wash.
What about that on again/off again “Chevrolet is going to be a global brand” image push that has been mishandled from day one and is still being mishandled? The notion that GM can exhort Chevrolet to lofty global heights isn’t exactly gaining much traction, or generating much confidence in the enterprise, to put it mildly.
(And by the way, GM flacks like to tout how the company has delivered fifteen straight profitable quarters - even recently reinstating a quarterly dividend - as homage to Akerson’s brilliance. This conveniently glosses over the fact, of course, that it was the humiliating “quick-rinse” bankruptcy that allowed the company to do that. The dramatically improved product portfolio maintained momentum in the market, there’s no doubt, but it was the bankruptcy debt rinse that got the company off of the mat. The Akerson acolyte/apologists hate being reminded of that fact. Too bad.)
And Barra saying that shoring up the regions is a priority is merely rote posturing at this point. That’s like saying “we’re going to do better in our business operations all over the world.” In other words, it’s a combination of wishful thinking on her part and keeping her fingers crossed that everything is going to work out somehow, sort of like managing the “air” around her.
But learning on the job in her new role is going to be like that with Barra, especially when talking to the media, or dealing with the media adulation (more on that later).
The real concern for Ms. Barra is the organizational quagmire left behind by the previous CEO. The only executive who is well placed where he can contribute the most positives for the company is Mark Reuss, who is comfortable leading the company’s product development troops and is supremely talented and capable in that role.
Everyone else in the executive suite – including Ms. Barra – will be learning as they go, which doesn’t exactly engender much confidence in GM’s ability to maintain an upward trajectory going forward.
I once likened Akerson’s “vision” for the orchestration of GM’s management structure before his departure to the friendly confines of Washington, D.C., as being akin to tossing a grenade through the door before shutting it behind him on his way out, because the chances for chaos and collateral damage are exceedingly high.
Why? Let’s take a look at these executive moves, beginning with Mark Reuss being replaced as president of GM North America – GM’s top job in this region - by Alan Batey. This move was completely baffling to insiders and especially to many pivotal Chevrolet dealers, who don’t hold Batey in high regard, to put it charitably. Batey had been senior vice president, global Chevrolet and U.S. sales and marketing, and he will continue to lead the Chevrolet brand globally even with his new responsibilities.
Batey has done such a mediocre job in his previous role that giving him even more responsibility seemed like an inspired move, no? This just in: when asked off of the record several very key Chevrolet dealers admit that they loathe Batey, viewing him as relentlessly tone-deaf and difficult to deal with. An arrogant prick for no apparent reason and one who doesn’t listen, in other words. Upon further review, no wonder Captain Queeg was fond of the move.
And what about Dan Ammann? The former executive vice president and CFO is now president of the company responsible for managing regional operations. The Chevrolet and Cadillac global brand organizations and GM Financial will also report to Ammann. Barra herself is said to have pushed for this move as the two get along famously, and Ammann is expected to make GM’s diverse regions operate with more consistency and efficiency. Ammann is also in desperate need of organizational experience - something glaringly lacking on his resume - which is another reason why he was suddenly taken out of his traditional area of expertise.
That Ammann fancies himself as The Shit is apparent for all to see. He goes out of his way to insist that he isn’t just a bean counter but a true car guy, touting his certification to drive on GM’s Milford Road Course and the Nurburgring Nordschleife in Germany as proof. That’s all well and good, but make no mistake, this move was made for the benefit of Wall Street, who isn’t comfortable unless they see one of their own near the top of GM. And Ammann is their guy.
But can Ammann do the job? That remains to be seen. If ambition and brimming confidence that too often veers into annoying arrogance are prerequisites, he’ll do just fine. But he has a lot to learn about the business and he doesn’t understand jack about brands or branding, and having the twin divisional pillars crucial to GM’s future product success laid on his doorstep is a monumental learning-on-the-job moment. And a giant “we’ll see” as well.
And then there’s Tim Solso, the former CEO of Cummins Inc., who is the nonexecutive chairman. Solso is touted as a hands-on guy in a “nonexecutive” role. How will that work, you might ask? He will serve as counsel to Ms. Barra, at least that’s how it’s being presented, and run the day-to-day activities of the board. But it remains to be seen if Solso will embrace the “go-along-to-get-along” role, or get edgy to do more.
So there you have it, ladies and gentlemen, this is the management team of the “new” GM. How will it fare? That remains to be seen. I’m not fond of learning-on-the-job expeditions but the one saving grace is that the product is in good hands, and until proven otherwise, this business is all about the product. Always has been and always will be, as a matter of fact.
If Ms. Barra lets Mark Reuss do his thing and makes sure that he and his team have all the tools – and the money – they need to work with, she’ll be ahead of the game.
That Ms. Barra was thrust into a role that she wasn’t exactly qualified for is beside the point at this juncture. And being a GM “lifer” doesn’t count for much of anything in today’s white-hot global automobile business either, so she will be tested at every turn and in ways that she can’t even imagine. This is likely to be a work in progress well into her tenure.
But one thing I’m quite certain of is this: If Mary Barra let’s the largely undeserved - and wildly premature - accolades get to her and she starts believing her press clippings, it is not going to go well for her, or for GM, for that matter.
And that’s the High-Octane Truth for this week.