GM’s Ed Whitacre not the average car chief
They’ve never seen a CEO at General Motors Co. quite like Ed Whitacre.
He wanders into small meetings unannounced and, before leaving, asks in stark terms what people can do to sell more cars. He urges them to take risks by making decisions; ask him whether he means it and he’ll probably say, yes, he means it.
Wearing jeans and a sweatshirt, he shows up unannounced at assembly plants — Lansing and Lordstown, Fairfax and Flint — and walks the line, stopping to talk with ordinary auto workers.
”My first impression was kinda ‘wow,’ ” says Ben Strickland, shop chairman for UAW Local 1112 in Lordstown, Ohio, home to the new Chevrolet Cruze compact. ”He definitely left the impression that he was no different than anyone else in that plant. And that went miles.”
Except that Whitacre, appointed chairman of GM’s board by President Barack Obama’s automotive task force, is different from everyone else — which is the point. In interviews with senior executives, union officials and midlevel managers, the CEO emerges as the antithetical GM boss: a serial delegator who loathes process and PowerPoints, who thinks GM’s historic reliance on data can be paralyzing, who cannily meets employees on their own terms.
He grew up in the deal-making of AT&T Corp. and its precursors, not the noble decline of GM. He wants simplicity and accountability, not the contorted self-justifications and endless study of the Detroit auto business. Mindful that there are no third chances for GM, he isn’t likely to give longtime hands the benefit of the doubt that most of them have known too well.
”He can read people in five minutes,” says a ranking executive who requested, as did others, not to be identified when speaking about the boss. ”That’s one of his gifts. ”
It’s Big Ed’s GM now, a work in progress whose return to market credibility and sustainable profitability after a historic bankruptcy is by no means assured. He knows it. GM directors know it. And anyone with a stake in the company’s success should know it.
”Ed’s the first guy to tell you it’s not all figured out yet,” says another GM executive who works closely with him. ”There’s some fear in this company. People are nervous. They don’t know what it means — ‘I get to make my own decisions.’ ”
Simpler, faster answers
For a clue, look to Big Ed himself.
In a place that elevated bureaucracy and ponderous presentations to high corporate art, Whitacre is routinely moving in the other direction. Give him less data, he says, in favor of more facts, more answers and more solutions from the people closest to the problems.
It’s hard to overstate how challenging that turnabout can be to GM’s often-constipated culture, where studying something to death (products, business deals, whether to prepare for bankruptcy) too often was mistaken for actually getting things done. Not in what’s taking shape inside the GM of Whitacre, named CEO last December.
Monday meetings of his 13-member ”Executive Committee” are typically wrapped up in a couple of hours — unless Whitacre is on a tear — compared with the daylong ”Automotive Strategy Board” confabs of old that had a corporate ritual all their own.
Monthly sales reports have been simplified, and hourly updates on the final day of each month were abolished. Forward-looking production plans no longer are reported because Whitacre couldn’t understand why GM routinely aired such competitive information when many rivals did not.
Spending within GM’s multibillion-dollar capital budget now requires fewer approvals once the overall budget is approved. Operating executives, such as North American President Mark Reuss or product development chief Tom Stephens, are encouraged to tap resources already approved in larger budgets by Whitacre and the company’s board of directors.
The goal: Move quicker, empower management, push accountability deeper into the frozen middle of the salaried ranks unsure what to make of this newfound emphasis on autonomy and risk-taking.
Even board meetings are streamlined, according to several executives familiar with the changes. Approvals of routine capital spending have been reduced, as have the number of board actions required to green-light product programs.
Gone are the two-day sessions of old, replaced by crisper, half-day meetings intended to let Whitacre and his team run the company while the directors focus appropriately on big-picture issues. Those include corporate performance and the crucial timetable to sell GM shares to investors, the first step toward extricating the U.S. Treasury from GM.
Homegrown talent works
Whitacre’s GM is not the old GM, partly because he’s nothing like his predecessors.
Until congressional inquisitions prompted GM to dump its corporate jets, former CEOs crossed time zones like most people cross town. Whitacre dislikes travel; he hasn’t yet been abroad as GM CEO, though he and the company’s directors are scheduled to hold their June board meeting in China.
He’s neither a veteran of the auto industry, nor an engineer in the mold of Ford Motor Co. CEO Alan Mulally. But Whitacre does share his rival’s obvious preference to unleash homegrown talent instead of import it — primarily in the engineering, development and building of cars and trucks.
Sure, he’s wooed former AT&T colleagues (three of them, actually) to GM, in communications and government affairs. His CFO is a veteran of Microsoft and the new treasurer is coming from Wall Street. In the guts of the operations? Reuss, son of a former GM president; Stephens, a GM engineering veteran; Nick Reilly in Europe, a longtime GM executive; and Tim Lee at GM international.
Whitacre ”is an enormous delegator,” says another executive who has worked closely with him and echoes the assessments of others. ”He doesn’t spend a lot of time in operating meetings. He puts his team in place and they are responsible for doing the work.”
And delivering the results.