Lutz Speech on Managing Change
Text of a Lutz speech in Detroit to the Michigan Council for Arts and Cultural Affairs on managing change to unleash creativity and innovation.
Thank you, Gene [Gargaro, VP at Masco and chairman of Michigan Council for Arts and Cultural Affairs], and good afternoon everyone.
It’s great to be able to talk to you today, and I’d like to welcome you all to Detroit – I hope you enjoy yourselves here. I’d just like to get one thing off my chest before we start: I make no pretense of being an expert in the arts.
I do know that Oscar Wilde said of art, “It is through art, and through art only, that we can realize our perfection.”
I also know that Groucho Marx said, “Well, art is art, isn’t it? Still, on the other hand, water is water! And east is east and west is west and if you take cranberries and stew them up like applesauce they taste much more like prunes than rhubarb does.”The bottom line is, I can’t tell you what either of those quotes means!
But I can tell you a thing or two about the topic you’ve chosen for your conference, Driving New Agendas, which in essence is managing change.
And, as an added bonus, to expound on that topic, I’ll even give you one more quote that’s semi-related to art, and it’s from the poet Samuel Taylor Coleridge, who said, “There is one art of which man should be master, the art of reflection.”
I’ve been in the car business a long time, and I’ve had ample time to reflect on the way things are done. And organizing and managing change is one of the subjects that I hold dear. I know that our fields are very different, although I would argue that a beautifully designed automobile is certainly a work of art.
But there is at least one thing we have in common, and that’s change. Change comes whether you like it or not, and there are those who will resist it, whether you want them to or not.
I was asked the question by the organizers of this event, “Can change be managed?” And the answer is absolutely, yes.
Although I must point out, it’s a qualified “yes.” It’s like someone asking, “Can you stop the rain?” Well, no … but I can bring an umbrella.
There are some things you can control, and some things you can’t. The trick is to control everything that you can, and to use your common sense to prepare yourself, your staff and your organization for the things you cannot control.
If you keep that in mind, then you’re already past step one of change management: don’t panic.
Corporations have come to approach change with an almost childish tendency toward overreaction. First they bring in the latest thinker, author, lecturer or change maven who has discovered that, sure enough, there’s change happening out there.
He or she speaks to management and warns of the impending crisis. Committees are formed. Retreats are held. Brows furrow with the weighty realization that change is bearing down on the company like the Mongol hordes.
It will be here any day, and we have to get ready! What to do? Hire consultants, that’s what! Change agents, that’s what we need!
In the old days change agents were called “leaders.”
The first responsibility of leaders is to manage change. That’s what they do every day, all day. And there is nothing new about it.
One of the more disturbing features of our current preoccupation with change is the presumption that all change is good. Look at the language that the human resources people put on employee review forms today: “Does the employee embrace change?”
I conjure the image of fast trackers desperately looking in every nook and cranny of the company for some undiscovered and unembraced dollop of change that they can put their arms around and squeeze.
That’s silly, of course. Change has no inherent normative value at all. Some change is good. Some is bad. People ought to be evaluated based on whether they can tell the difference, not on whether they obediently and mindlessly embrace unexamined change.
So, once you separate the good change from the bad, you recognize that a good leader has to be a change killer as well as a change agent.
I’ll focus on the change agent, because it’s often the more difficult of the two roles. The biggest problem the change agent faces is, more likely than not, having to overcome his organization’s disinclination to change – the natural inertia that impedes any institution.
Driving an organization toward beneficial change requires enormous energy, conviction, persuasiveness, and, ultimately, stubbornness.
You will meet resistance. The organization is successful as it is, why change? Why experiment? Why venture into the unknown?
When I was at Chrysler in the late ’80s, this attitude was much in evidence as we tried to switch to a horizontal approach to engineering vehicles as part of a move to platform teams.
That means we were trying to draw small groups from different specialties to engineer a whole vehicle, rather than their specific areas. And that was threatening to the partisans of the traditional system, even though we were all living under a wasteful, error-prone, slow-moving process.
The flood of anonymous letters from these partisans to Lee Iacocca was impressive, both in quantity and quality. It would have been easy for management to flinch.
Instead, we persevered. We relied on countless, no-holds-barred “town hall” meetings to allay workers’ fears and explain why change was necessary. We tried to impress upon everybody that we were adopting one of the hallmarks of what was then Japanese superiority.
The forces of conservatism remained strong, and were joined by those who worried that their status was in jeopardy – which, of course, it was! Their power and influence, tied to the old fiefdoms, would be reduced from the moment personnel from these groups were split up and reassigned to platform teams. So they resisted with all their might.
Well, we weren’t going to give in, because we knew we were right. So we followed the change agent’s correct course of action: we calmly pressed ahead, continuing to explain the why of change, while at the same time forcefully implementing action.
It’s remarkable to see how quickly resistance crumbles once the first tangible successes of the new approach become evident. Our plans were implemented in full and it changed the company forever, for the better.
Sometimes, the change agent gets resistance from above, and I don’t mean from Heaven, but something even scarier – from senior management.
One effective tool to use in cases like this is benchmarking. Show the bosses how somebody else is doing it better or, almost as important, more cost-effectively. Nobody likes to hear the competition is making better products or saving more money.
At Chrysler, a Honda benchmarking study proved instrumental in helping us see that we had to change and change quickly. And no junior managers were shot for suggesting that we needed to. They weren’t criticizing Chrysler directly; they were just reporting how Honda went about making cars. The study was invaluable.
It’s very important to foster a culture of open communication and encourage ‘push-back.’ It leads to innovation and new ideas. If someone is afraid to make a suggestion or challenge the way things are done, things rarely improve. In fact, they stagnate.
When I started at GM just over a year ago, I handed out thousands of buttons I’d purchased at my own expense that said “Sez Who?” It was my way of telling everyone to have the gumption to question things they thought weren’t right. I wasn’t encouraging armed insurrection, but I did and do want to see some resistance to old ways of thinking.
Whether you’re taking orders or giving them, you have to do all you can to unleash the creative talents of an organization and encourage innovation, at all levels.
Innovation is the new frontier in the automotive business, and in a lot of other areas as well. It’s what “quality” was in the ’80s and ’90s. The pace of innovation is what will separate the winners from the losers. And innovation thrives in a culture of encouragement and acceptance.
Sometimes, even in the most accepting of cultures, the message of change simply cannot get through. It’s like the Cone of Silence is hovering over the decision makers.
Well, when all else fails, the change agent can always fall back on the dreaded consultant. I know the cynic’s definition of a consultant: someone who travels a thousand miles and charges five thousand dollars a day to tell the boss what you already know.
I once wanted to pin a medal on the chest of a friend of mine who’s on the board of a large corporation. When its CEO recommended bringing in a consultant to write the company’s strategic business plan, my friend told him, “This board is certainly willing to pay for a business plan. Now, we can either pay you to do the strategic thinking for the company, or we can pay the consultant, but we’re only going to pay once.”
Nonetheless, good consultants, just by virtue of being outsiders, can often get your colleagues’ attention in a way that you, being familiar and in-house, cannot.
I realize that for some of you, high-priced consultants are not an option. I also realize that for a lot of state-funded agencies, “driving new agendas” really means “how to do what we do but do it with less money.”
And if that’s the crux of what we’re really talking about here, I’m sorry it’s taken me this long to get to it. But I do have some thoughts, and I’d like to illustrate them with another example that you’re probably familiar with.
The way to do more with less is by making stretch goals, and encouraging everyone to do everything they can to reach them. That way, even if you don’t reach them, you’re still likely to drive improvement to new levels.
The best example I can think of is actually one of the defining, and perhaps underrated, moments of the 20th century, and that is the Berlin Airlift.
On June 25, 1948, the former Soviet Union shut down all the roads to West Berlin, which was of course surrounded by Soviet-controlled East Germany.
It was an effort to force the U.S., France and Britain out of Berlin. When the Western enclave, devoid of supplies, eventually shut down, the Soviets would simply march in.
It was estimated that the two million inhabitants of West Berlin could get by on a minimum ration of thirty-five hundred tons of food and coal daily.
No one, including the U.S. Air Force, had ever moved so much tonnage so quickly. With one plane landing in Berlin every eight minutes carrying two and a half tons, an average of one thousand tons a day were delivered in the first 10 days. The Soviets ridiculed the American effort as futile.
By mid-July, however, deliveries had climbed to fifteen hundred tons per day. By August, with larger cargo planes in use, the number climbed to four thousand tons daily.
The pressure on crews and aircraft was tremendous: eight hours of flight time followed by eight hours of ground duty and mechanics working around the clock. The work was becoming chaotic, and problems were mounting.
Maj. Gen. William H. Tunner, who in World War II had organized the airlift of supplies over the Himalayas from India to China, was brought in to supervise.
To bolster waning morale, Tunner introduced a host of measures, including a special newspaper – The Berlin Airlift Times – to celebrate feats accomplished and records broken.
By using the newspaper to excite a friendly rivalry between crews, Tunner gave the Berlin Airlift the trappings of a competitive sport. By keeping his troops’ spirits high and their competitive instinct aroused, he pushed their results even higher.
By March of 1949, more than seven thousand tons of supplies were coming into Berlin daily, twice the survival level.
But Tunner, in the spirit of true leadership, felt his crews needed a new challenge to shake off any creeping complacency. He set an arbitrary, “impossible” goal of 10,000 tons in one day. His challenge was publicized in the Times under the headline “Tonnage for Tunner.”
His troops’ imagination was captured. They strove to find new ways to make the impossible possible. They began ‘prepositioning’ loads, for example. In other words, they innovated.
On Easter Sunday, April 16, 1949, the impossible was done. Twelve thousand nine hundred and forty tons were delivered to Berlin. By mid-May, the Soviets, realizing their blockade was futile, restored access to West Berlin. The Americans had won the first and defining battle of the Cold War, and won it decisively.
The battle was won through hard work and great leadership. The single greatest attribute of Tunner’s leadership style, in my opinion, was its insistence on constant change.
He changed the pilots’ flight rules from visual to instruments. He had bulldozers cut apart, lifted to Berlin and welded back together to build more runways. And he experimented constantly with innovations like the newspaper to improve motivation and instill teamwork.
He cajoled his people to meet impossible goals and celebrated exceptional achievement. He created a “Super Bowl” mentality that made attainment of the goal possible. That the goal was exceeded by more than 20 percent shows just how much can be achieved by average men and women, overworked though they may be, if they believe in their mission and receive strong leadership.
Now, am I suggesting you go back to your agencies and redesign all of your newsletters or start some sort of competition among your staffs?
Of course not. I’m saying you have to be creative, especially in difficult times, to motivate your people and get them to be more innovative, and do the impossible. Or at least the improbable. It’s a hallmark of leadership.
One last thing … another question I was asked by the organizers was how to best position ourselves for an unknowable future.
Well, what I’d like to know is how to best position myself for a knowable future?
The future is always unknowable! So you prepare for it just like you would prepare for anything else … by using your common sense, the greatest weapon at your disposal. That’s what lets you discern good change from bad change. That’s what hones your instincts and sharpens your senses as you gain experience in your field. And the more you use it, the sharper it gets.
I’ll leave you with one final quote to think about, and that is what Emerson said about this. He said, “Common sense is genius dressed in its working clothes.”
So put on those working clothes and you’ll be surprised how easy it really is to manage change effectively.
Thank you for your kind attention and if there are any questions I’d be happy to take them.
Remarks by Robert A. Lutz
National Assembly of State Arts Agencies
Annual Meeting
Marriott Renaissance Center
Detroit, Michigan
October 17, 2002
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GM starts a blog
I see a GM executive started a blog at http://fastlane.gmblogs.com I am surprised since this is a company that shuts up like clam on adverse issues such as with Dexcool
My Wife bought a 98′ Pontiac Bonneville from a now defunct dealer in Virgina a …
Aloha Mr. Lutz,
Opening up a blog is a pretty gutsy move and it tells the world that you’re open for comment and input. I hope you get the feedback/input you’re looking for. If I may, I’d like to be an early poster/questioner:
Why has GM continued to make such lousy cars when they’ve had 20-30 years to recognize the Japanese we’re coming on strong with a much higher value proposition?
In case others within GM are still convinced they make the world’s best cars, let me offer a simple proof of my claim: resale value. Look at the resale value of any GM car vs. it’s Japanese counterpart and while you may find GM comparables costing a little bit less at new car retail, by the time they’ve each put on about 50k miles the resale values aren’t even close.
I’m a proud American that really would rather buy American instead of Japanese, but every time I get into a late model American rental car with
Bob,
I enjoy reading your speeches – they really hit home. I have to wonder, however, how it is that you are able to justify the Pontiac Torrent and the “Total Performance” marketing spin put on what is essentially a rebadged Chevy Equinox with a last-generation Chinese-built V6.
I was hoping that the Equinox engine choice was going to go away as production of the 3500 went up — an with the 2006 Impala the 2005 CSVs and others getting this engine, I can’t see why the Torrent got stuck with the old 3400, despite the “cooling and accessory drive enhancements in the 3500 that increase reliability and durability” as opposed to the last-gen 3400. The Torrent looks so good that I’d like to buy one, but not with that old dog of an engine, and I shouldn’t have to wait 3 years and pay 4000 dollars more for a GXP model to get something better from a PONTIAC.
Please, please manage change at Pontiac, and at least cut down on the marketing spin that insults all Pontiac enthusiasts who know a cheap rebadge when they see one.
And thanks again for the awesome Solstice – THAT’S the kind of car that makes Pontiac stand out…even if Saturn will get its own version with significantly different sheet metal.
Mr. Lutz,
Thanks for the opportunity to comment on this speech. You make the point here that it’s important for leaders and companies to embrace change.
I couldn’t agree more, but I don’t really see where the change and innovation are at GM. For example, where is the company on hybrids? Do you think GM should take a leadership role in the U.S. market to encourage consumers to purchase more fuel-efficient vehicles, or do you believe the company should sell people what they want, regardless.
Perhaps you could write a bit about what GM’s vision is for the future of motor vehicle design.
Mr Lutz,
Thank you for your frank comentary. I was pleased to see you come to GM and know with the funding and lead time things are not going to change over night but they will indeed change.
I am a life long GM Customer and fan and hope to never change.
But the year I went to the Detroit show and saw the Aztec I had to come home and E mail Pontiac and ask [quote] “what the hell are you thinking?”
I am as you a strong believer in gret styling and quality. Also I feel it still take great marketing to sell a car.
I have seen some improvement but some areas still lack. Take the new G6, the world is shown a good but base GT. The press pan it as being better but not great? I find most base cars are not always great. I feel if you introduce a car you need to show your best as I expect the GXP will be. I feel if you show your best the rest of the product will sell itself. As of now most will remeber the stories of the better G6 GT and pay much attention to the GXP when it arrives.
On the other hand I do note Chevy is playing the SS card well. They have pushed the Cobalt SS first and it will sell many on the standard coupe and sedan just because of the relationship.
I am not only a car buff but make my living at Summit Racing Equipment. We are the largest mail order high performance parts house in the world. I deal with people of all walks of life in countrries around the world.
I still see what Bunkie Knudsen said that you can sell an old man a young man’s car but you can’t sell a young man an old man’s car being true. He is the man that impowered John De Lorean to due what he did with Pontiac in the 60’s even with out the blessing from the top.
Today I see you in the same place as Mr De Lorean but with corporate blessings. I see this as hope. I see your new performance division as an area that will move GM foward. The talant that created the Z06 and CTSv are GM moving force in the world market.
If John D was permitted to put the radial tires, four wheel disc brakes and overhead cam V8 in the GTO, think of where GM would be now.
I know things are changing at GM. The old ways of the 14th floor are moving on. I had a great uncle who was like a grandfather to me. He was chief specifications engineer for GMC and worked at GM from the late 20’s to early 60’s. I learnd from him how GM worked back then and saw how they did not change till just the last few years.
Well I have used enough space for now I hope you read this and know I have great hope in your moves at GM. Just be careful in the L39, we need you!
By the way, as a 20-year Fiero owner I want to thank you for bringing the Kappa to life. I hope it will be my new toy when the the High performance engine arrives. Also yes I will keep the Fiero too. It was my first new car and it has been a great car, trouble free and saved my life in a head on crash at 45 MPH. I even drove it home after pulling the steering wheel back out.
Thanks! Scott Swisher
Saying No To Change
‘Embrace Change’ is often said to be a universally good thing. However ‘Change for Change’s Sake’ is clearly bad. So how do you tell the difference?
This question is
GM should have hired you right after you left Ford. GM is too stodge an organization, they have layers of middle management that just go with the program…yes men..collecting hefty pay checks…make them accountable for meeting cost and quality goals, if not get rid of them. Somebody has to make it a priority to get GM share value in the high 70’s where it should be..I have been a GM shareholder for 25 years and still waiting.
The only reason Chrysler hits home runs with design is because they take chances…it’s time GM follows suit…a couple of honme runs (high volume like the Chrysler 300 for instance), will get GM out of the rut.
Make the UAW accountable too…how many committeemen, alternative committeemen, administrators etc. are there in the whole GM system (thousands)..not adding to the bottom line. Do a calculation, it may pay a large portion of the retirees medical/pension liability
Thanks for letting me comment.
Gerry Noronha
I think the reason GM is losing market share is not because of the poor quality of their vehicles, but because the quality of the warranty service that the customers is not getting anymore. It would seem to me that if a customer has a problem with a new vehicle then it should be fixed, because that is what should happen when one spends money on a product. I think that is what keeps customers coming back and telling their friends how great it is to have your product. I know some people who have new vehicles which have problems and are not getting any satisfaction. I am sure there are a lot of people like myself who know the same sort of thing. I don’t think that the foreign autos are any better, it is just that when there are problems, they are taken care of. That makes a difference to a customer and he or she are glad to tell their friends what great service they receive and recommend the auto to them. GM seems to have lost track of what got them to where they are, and that is that the customer should come first, and that the profit will come from the sales as satisfied people use word of mouth advertising for GM.
Your stretch goal example re Maj. Gen. Tunner was indeed inspiring. What stretch goals have you given to your orgranization? For example regarding miles per gallon or emission levels? Thanks.
Bob Lutz – GMBlog – On Culture…
Hugh Hewitt mentions this brand new blog, Fastlane.GMBlogs.com on his website, read it here. Want to know what a major corporate executive thinks? Read his blog. There are also links to some of his speeches. I hope that he continues this.
Thanks for making the text of your speeches available. They provide great insight.
Congratulations on the blog! It will be better than any press release your company ever put out.
Hello Mr. Lutz,
Thank-you for the opportunity to express some of my view regarding GM. I have owned and driven GM cars for 30 years. I bought a Pontiac Fiero brand new in 1985 and still use it as a daily driver today. I also drive Buick. From time to time, GM comes up with some pretty good cars and the direction you are taking GM is a good thing. However, I am a disillusioned customer. The post sale and ownership support at GM is simply awful. When a customer brings his car in for service, he shouldn’t have to return it 5 times to have it done correctly. If I own an uploaded Buick, I don’t expect to be treated like I bought a bare basic Cavalier. If I bring my Buick in for an oil change, I don’t expect my front wheel to fall off 2 weeks later only to have the GM district manager say I must have tampered with the wheel while the car is under warranty. When I bring my car in to have a recall service done where the recall was to do something that would prevent engine fires, I don’t expect my engine to be on fire having gone no more than 5 miles after this service was done and then being initially charged to have all the damages fixed. There are a few other issues, but I’m getting long winded here. As much as I like GM products, I, the customer feel like I’ve been grossly mistreated in my ownership experience.
I believe you have set the right direction in the product department of GM. I wish you well in it because I know how hard it is to change an organization as big as GM. It’s going to take awhile. GM needs to look at it’s entire business and make changes there also. I, like my father, brother and scores of friends, no longer have any particular loyalty to buying a GM product but the recent line of cars coming up have made me take interest.
Good luck and thanks for letting me vent.
Bob,
I have been keeping up with you since you left Exide. I just wanted to say Hello, thanks for getting the ball rolling at Exide and – Great Job at GM! It seems that you have created a strong environment for change within GM and have created some really cool products since your appearance there. In knowing you during your time at Exide, it seemed to me that these cars have your name all over them.
Keep it up! Having owned 10 Camaro’s in my life from 67 to 96, I would love to see a new one ? Anything on the horizon?
I know you are busy but, feel free to call or respond to this e-mail. It would be good to hear from you.
Hope all is well.
Smokey White
Dear Mr. Lutz,
First – congrats on great moves with GM!
Would like to use this opportunity to present you
one possibly interesting concept for your advertisment campaigns.
The concept would be based on giving a possibilties
for every potential client to have test drive of your cars in their own homes.
Phase I
Create CD which has recorded all cars with all posible options. Also has option that ones client creates this car can also take a “test drive” of particular car – simmilar to virtual video games.
Phase II
By using direct mail CD arrives in house, client enters into their PC and starts process. Once client finishes car and takes test drive, CD initiates internet connection (with prior approval from the user) and offers additional features and more options for additinal test drives. This way you would create initial excitment on potential clients
Phase III
Once client is connected to your server you would be able to directly engage particular client and to offer him if he/she would like now to have test drive of that car for real. If answered positive, your server would automaticly arrange this test drive with local dealership with time and date.
Phase IV
Client visit dealership at scheduled time where car is already waiting for him/her.
Rest of it is up to your sales people…
Cheers,
Mr. Lutz,
I too agree with the forum that your guts to start a blog was– how shall we say…, “unGMish”. Your designs this year are ground breaking and do believe that your impact is starting to shine. But my comments today are of another matter.
As an insider to this once great company, I can’t help but wonder how senior management such as yourself, Gary, Rick, John, etc. don’t see what’s going on below you in VSSM. You have a leadership team know around the office as the “Cadillac Mafia”. John S, Mark L, Pete and his friends, are all running the show. Do you think it’s right that leadership still promotes the “good ole boy network”? If you continue down the echelons, the practice continues.
It is very common to hear the hallways shout that we (GM Personnel) are our own’s worst enemy. Sometimes I feel, I’m back in vietnam again (my uncle shared grusome accounts of internal feuds)and witnessing a company destroy itself for the good of each individual.
Rick’s vision of Act as one Company is just that, a vision. We are so into making our numbers work, that we disregard whether our results are accurate or not.
Mr. Lutz — you’ve got the guts to move our company. Ask your people in a non threatening way about the state of the internal business, and they will tell.
Thanks for listening.
Hi Mr. Lutz. Thank you for the opportunity to comment here. I truly hope that this is more than PR hype designed by your marketing/public relations firm. Given the opportunity to speak one-on-one to the boss, I would like to offer a few suggestions:
1. When a car is replaced, like the recent Cavalier/Cobalt change-over, STOP making the old car, even for fleets and/or rentals. GM has to be seen as a company that is moving forward, not just one who is milking the last buck from a 14+ yr old design. Many of us who do not own GM get a taste of these cars when renting while away from home. We should drive a Cobalt for the weekend, not a re-warmed Cavalier. You’re not the only one who does this… Jeep did it when the Liberty replaced the Cherokee, and Ford is doing it with the Taurus/500 changeover. It is interesting to note that all three of these designs are among the oldest, and in their time, the most successful cars of their day.
2. Although I hope you do this already, buy yourselves a set of the competitors’ cars, and have the top brass and those not in management take them home for a real weekend… out to dinner, picking up kids, etc. Although some will argue about the particulars of the Accord or Camry, or Audi or Chrysler, but the truth is in the numbers. Whether it has been the Accord or Camry depending on the year, these have been top sellers lately, and although they cost more to buy, they often do not have incentives like their GM counterparts and retain a higher percentage of their original value. As a teen, I remember reading about the Olds Cutlass and how it appealed to everyone. GM has lost this edge.
In 1991, I bought a then all-new Camry, for $17K, complete with ABS, sunroof and premium stereo. Nine years later, with 110K miles, I sold the car for $5,500. There is no doubt that the comparable Chevy of its time would not have fared as well… plus aside from brakes, tires and oil changes I had no repairs to the car. I followed this with a Subaru, then a Nissan. With everyone from Consumer’s Reports to Car and Driver confirming my trust in Japanese cars, I need a compelling reason to switch to American cars
3. Each time I buy a car I look at GM and the other Americans and return to the Japanese. It may be wrong, but the perception is better value, better design and better fit and finish so I continue to buy Japanese cars.
The last generation started buying American, and many changed to Japan or Europe, which at one point was unusual, but is now the norm. The current generation grew up in a time when buying foreign was normal. As a man reaching 40 who has bought or leased 10 cars, all Japanese, I am a perfect example of this. PLEASE give me a reason to change next time around!
4. Somewhere else on this blog was the quote that “you can get an old man to drive a young man’s car but not a young man to drive an old man’s car. You’ve done a great job making Caddy “younger,” now you need to do the same with Buick. Ponitac needs to be REAL performance, not just fender flares and spoilers.
5. Invite a bunch of us car junkies to a weekend in Detroit (or somewhere with better weather.) This is not shameless begging for a free trip (ok, maybe a little)… but it would be a chance for you to speak to real people about their concerns and ways to improve GM. Your recent Auto Show in Motion was great, perhaps you could sneak in and sit down with some of us to speak informally afterwards.
I really do want GM to survive and prosper. I know Americans can build great cars with amazing fit and finish… they do at Honda, Mercedes and Toyota. Increasingly, they’re doing it at GM.
As I’m sure you see on this blog and on others, as well as at the Autoweek Combustion Chamber many of us are pulling for you, and we are quick to jump on errors and praise a job well done. In the end, you’re not the boss, consumers are… without us there is no GM.
I can’t speak for anyone here but myself, but as a subscriber to auto mags, who posts at sites like this and can tell the difference between a 91 and 92 model based on different tail lights, I have more then a passing interest in cars. For many others, cars are an expensive appliance… they want the car to start in the morning, get them safely to work and home and not cost too much. Both groups need to be catered to. Thanks for making a great start.
Dear Mr. Lutz,
As a long-time GM buyer and supplier, I am extremely disappointed in GM’s so-called product renaissance and the way you guys now do business.
Have you ever looked at GM’s intellectual property agreement? It basically says that anything a supplier gives you is not protected and that you can do whatever you want with it, including sharing it with competitors. You also welcome non-confidential suggestions. So now you want free consulting, as well, while you give the business to another supplier? You’ve become an 800 lb. gorilla with a bad attitude. You already have all the leverage in the world! All you are doing is creating a lot of bad will and turning off loyal buyers everywhere.
In addition, where’s the accoutability at GM? Did you fire the managers who signed off on the Aztec, the Saturn L2, SSR, GTO? All products that have suffered in the marketplace and cost lots of ordinary people their jobs. While health care costs are a big issue for everyone, it seems you use them to camoflague your product weaknesses. If you didn’t have to give such huge rebates to sell your products, would health care be as big an issue? Aren’t those rebates a sign of product weakness?
Regardless of the pain you cause people, they will survive, they just won’t buy GM products anymore!
Dear Mr. Lutz:
It is time for GMC to have a car. You did away with Oldsmobile, and you are promoting change. So it is time for GMC to have a car.
A car designed as a hybrid starting with gasoline and electricity and working toward ethanol and electricity.
It needs its own independent design team that works only for GMC, and every member is responsible for the total design from the ground up. Attention should be paid to every aspect of design … safe seats, side impact, fuel economy, power/performance, quietness, comfort of ride, etc. There should be only one goal to push the numbers upward in every category of design and performance.
Forget models … work for the ideal all around car. A car that will outperform everyone, and still be economical enough that average working class Americans can easily afford. A car that will outlast the Volkswagon Beetle (the original) in durability.
Now we add the production team, the marketing team, and the sales team, and make it a reality.
The overriding goal is always Quality first, and everything else some where behind.
Change? You bet … it is not possible, it can be done … a car toward which all other cars strive to be like.
Mr. Lutz,
Thanks for the courage and vision you have brought to our once great company and this forum. I couldn’t agree more with the thoughts on change leadership presented in your speech to the MCACA. Like several other bloggers on your site, my response comes from the inside of our ‘good’ company and is focused on our return to greatness: a campaign which I believe reflects as much on the American spirit as it does on GM’s viability to compete on a global scale.
As a manager in our manufacturing organization, I have become increasingly concerned with our ability to embrace and execute the changes needed to compete globally. In the past several years, our “senior management” has been increasingly candid about the imminent threat of Toyota and other lean manufacturers here in North America and abroad. While their willingness to ‘confront the brutal facts’ regarding quality and productivity gaps is refreshing and needed, their sense of urgency and demonstrated leadership toward real change in the way we build our products lacks innovation and courage.
For years, industry watchers and analysts have pointed to our inability to harness the innovative and creative power of the people who labor every day to manufacture the cars and trucks that fund our future. My own experiences in our manufacturing facilities and with our senior management validate this shortcoming. In these dynamic plant environments where one would hope to find communication and innovation, I deal daily with apathy and fear as I work with our people. Where one might expect strategic vision and knowledge in the direction from our leadership, too often we receive clich√©s (”Focus on what matters most. Less talk & more action. Re-think the way we do things”).
Real change will be characterized by risk and yes, failure. But before we can learn and grow from these experiences we must be willing to jointly (UAW & management) practice and master the ‘art of reflection’ i.e. growing from our past achievements and failures by practicing the 5 Why’s instead of the 5 Who’s. Our tendency to blame, embarrass and punish risk-takers has resulted in a management team which feels responsible to “Plan 5% and Execute 95%” leaving little or no time for the learning that comes from dedicated follow-up (Check & Act). My experiences with our people have left me confident of their willingness and ability to execute 110% of any plan to which their joint leadership demonstrates a common vision and commitment to see through to the end.
For the good of our company and our country, can’t we put aside the clich√©s, our differences and our egos long enough to allow General Motors to re-establish itself as the great institution to which many of our parents and grandparents dedicated their lives and talents?
February 28, 2005
Dear Bob:
I’m a loyal, all my life, GM customer. In high school I drove a ‘56 Cadillac and a ‘63 Cadillac. In college I drove a ‘70 Chevy Malibu. I had a ‘76 Cutlass. I even stuck with GM after owning a Chevy Monza (that’s loyalty).
Now I’m driving my third Astro van. I love the van. It gets good gas mileage. It’s very roomy and open on the inside. There is a real sense the driver and the front seat passenger are not separated from the back seat passengers. It’s great for taking trips and carrying friends or soccer players, with plenty of room for bags. It’s easy to park.
My problem with the Astro van – everyone makes fun of me for driving it. The Astro van hasn’t been updated and the design is looking old. The interior needs updating. I want to upgrade to a new vehicle. In my next vehicle I’d like to have a satellite navigation system built in. An SUV with similar interior space would be a huge gas guzzling monster and would be ~7″ wider, making parking difficult. I also have a problem with the pretentiousness of SUVs. 99.5% of them never leave the pavement. What is so “sports utility” about going to the grocery store? My Astro van doesn’t pretend to be anything it’s not. It’s an easy efficient people and cargo mover.
I went shopping and my first stop was to a GMC dealer to look at the 2005 GMC Safari van. I was hoping it might look a little more macho. It looks exactly like my ‘96 Astro. I can’t get all the new high tech options. How in the world can GM blame the vans’ falling sales on anything other than the lack of a redesign?
So…what to buy? In desperation I went and looked at the new 2005 Honda Odyssey. Looks dinky, too small. Just curious, while at the dealership I decided to sit in the new Honda Element. Bingo! On the interior – it’s just like my Astro van, only a smaller version. It’s hip, but it’s too small. If the Astro van was redesigned it could be hip too. The Honda Element is proof the Astro van could be successful again. (Last year I saw the GM ad showing the Honda Element. In the ad GM said Honda got the idea from the Pontiac Aztec. That was a little weird.)
When I mention to my 11-year-old daughter I am thinking about trading my ‘96 Astro van for a new 2005 Honda Odyssey she says, “Nooo, Nooo, it looks too girlie.” All the vans in the category look pretty much identical. Your new Pontiac Montana van is in the same niche and looks just as girlie.
With some help from our computer guys I’ve made an amateurish attempt to update an Astro van with some Honda Element and Hummer elements. I’m sure your designers could come up with a knockout design with an interior to match.
You can access it at the following URL:
http://auctioninsurance.com/soccertroopcarrier.gif
All the other mini-vans are smaller and there is much competition in that category. I think being bigger puts the Astro and Safari vans in a class all to themselves. There is also beginning to be a backlash against SUVs and I think a redesigned Astro van could be a big seller in a large market without much direct competition. I promise I’ll buy one. The new “Soccer Troop Carrier” looks like truck of the year material. Wouldn’t you like to have a successful new vehicle in a niche all to itself? I think cab drivers will like it too. Ditto for delivery drivers and plumbers.
I showed the redesign to some of your guys at your booth at NADA and they loved it. They said you had been by earlier. The two GM guys I showed it to both want one. One of them said GM should call it the Man-Van. I like Soccer Troop Carrier better.
Thanks for hearing me out.
Steve DeMedicis
Dear Mr. Lutz and GM executive management,
Today’s news makes for one of the darker days in Michigan in recent years. With production output lowered more factory workers will lose their jobs or be temporarily laid-off. And it’s not their fault!
If you look back at all the predictions of the late ’90s, you’ll see that most of them proved to be way off base. If you remember, after the Chrysler takeover, it was predicted that there would be more mergers, that you needed a minimum of 1,000,000 vehicle sales to compete. There was even talk that BMW would be “forced” to sell with probably Ford being a good fit. There was a lot of talk about “economies of scales” a term you never hear now. It’s hard to learn from the past when it’s been forgotten.
Instead what happened is the mergers forced management teams to spend their time integrating these new “divisions” while their competitors spent their time designing and building even more popular vehicles and gaining market share. While Ford, GM and Daimler have all struggled, companies like Toyota, Honda, BMW and Porsche are now the most successful companies in the business. Nissan and Renault is the best example of a successful merger. I think that you can almost predict with certainty that when there is a merger or acquisition that they will lose market share.
GM and Ford’s over-aggressive cost-cutting and single-sourcing philosophy will also be proven to be a poor management strategy. In addition to GM’s market share losses they are also suffering from the largest number of product recalls. And yes some of it is due to more part and component sharing, it’s also obvious that they are buying lesser quality parts and components. Suppliers must cheapen their products to meet their aggressive cost targets. In addition by shedding thousands and thousands of workers and causing layoffs at suppliers due to their over-aggressive cost cutting practices they have turned off thousands and thousands of loyal buyers. I can’t tell you how many ed-Ford and ex-GM employees now drive Hondas and Toyotas. Partly out of spite and because they also believe these companies build better products or are more attractively designed.
GM is now the Kmart of the auto industry, selling cheap products for budget-minded buyers. Locally only Chrysler really gets it, that developing products that people desire, and I measure desire by those willing to pay sticker price, is a much more profitable way of doing business, provides more stockholder value and ensures a better chance at long-term success.
Dear Mr. Lutz,
Lets show the world what this country is still capable of!!!! Let’s re-write the definition of “top end automobiles.” A spinoff of GM consisting of only two models… a high performance, state-of-the-art sports car, and touring sedan. Something that will blow the minds of Americans and Europeans alike.
While I fully realize that the people that buy high end European automobiles are of a “different mentality”,… lets teach them once again… like back in the old days… that if you lived overseas and you wanted a fine and impeccably made automobile…you imported one from the USA!!!
Very Limited Production
Totally hand made and assembled
Priced Accordingly
There is no reason in the world that we cannot produce it.
Ford put their minds to work and re-produced the GT with a very hefty price tag. I have a client that owns one… It is a true work of art.
I have a name in mind… Logo in mind… Badge for the car already designed… I have a High School degree… yet lack no intellignece, have a brilliantly creative mind, and a jeweler by trade… and this would be a true Gem in your industry.
Try a bit of true salt of the earth “Fresh Blood.”
At you direction I would be honored to send you my ideas.
Respectfully,
Aldo Dinelli
Mr. Lutz,
Read what your own employees are saying…. take a chance… reflect on the past…
“Real change will be characterized by risk and yes, failure. But before we can learn and grow from these experiences we must be willing to jointly practice and master the ‘art of reflection’ i.e. growing from our past achievements and failures by practicing the 5 Why’s instead of the 5 Who’s. Our tendency to blame, embarrass and punish risk-takers has resulted in a management team which feels responsible to “Plan 5% and Execute 95%” leaving little or no time for the learning that comes from dedicated follow-up. My experiences with our people have left me confident of their willingness and ability to execute 110% of any plan to which their joint leadership demonstrates a common vision and commitment to see through to the end.”
Not a totally different approach… just a rebirth of an old approach… where we were proud to build it because we knew it was the best!!
You are a higly intellignet man… you already possess the talent within your organization to develop the line… pull them aside and tell them that we are going to build a “technological benchmark” automobile. No other people on this earth will work harder to make you proud. I say this to you and I was not even born in this country.
Who still builds the most technologically advanced aircraft in the world today? We know how to re-write technology if we have the focus, drive, motivation, and heart to do it.
Once again I would love to pull your ear for a few minutes….
Respectfully,
Aldo Dinelli
Not a totally different approach… just a rebirth of an old approach… where we were proud to build it because we knew it was the best!!
Dear Bob
Our company operates the official merchandise store at http://www.GMC.com. Problem is, the “Merchandise” button is buried under a pull down area that is not intuitive for the consumer. So,no sales to speak of. Doesn’t GM want GMC enthusiasts to easily find GMC branded apparel and accessories to reinforce their brand allegiance? Chevy has a merchandise button on the main page, why can’t GMC? We’ve been pleading with your bureaucracy but so far, its not happening and the store has been live over 6 months. Please help us.
GM is really missing the boat with On Star. Most people I know have let it expire because the subscription is too expensive. Suggestion, offer 2 calls per quarter for $19.95. If you exceed 2 the charge is $10 each. I think this would lure people to use it and increase your subscriptions.
I grew up a GM guy. My dad bought a new Oldsmobile every two years. I grew up with that same passion. It was sad to see Oldsmobile go, but it had to happen.
I was raised in Michigan. I remember the passion we all had for American cars. I want that passion to continue for future generations, but to do that you have to turn them on to American cars.
This is a brief idea from a non-automotive employee, just an enthusiast. Here it is:
Cadillac’s new image is brilliant. Keep it going. Keep it focused, despite GM’s recent history which indicates it’s unlikely to do so.
Dissolve Buick. It’s redundant and not likely to take on BMW.
Do what GM did brilliantly back in the 60s: make Chevy the linchpin. Within Chevy, create three lines of cars:
The Impala. Sedan; coupe; convertible; crossover SUV. Share body panels and design. Rear-wheel and all-wheel drive. Offer base, RS (luxury) and SS levels on all. Take on Accord and Camry. Do what you did in the 60s by creating exciting designs – like Nissan has done this past model year.
The Malibu. Sedan, coupe; crossover. Share panels and design. Base, RS and SS levels on all. Front-wheel drive competitor to the Civic, et al.
Sports cars. Corvette and a Solstice clone tagged Camaro. Base level on the Camaro will be the SS version.
Properly position Chevrolet, and even the Pontiac division could be eliminated. Cadillac, Chevrolet and the GMC truck divisions could cover every base. It would be lean and it would leave no doubt as to what GM stands for: a passion for affordable, exciting American cars.
Thanks for the blog. It’s brilliant, considering that there are millions of us out here who love GM. It’s a great resource for ideas and the survival and thriving of GM. We love GM, Mr. Lutz, now go kick some rear, ok?!
I believe first GM must get rid of its union and then start improving there qualities of their vehicles. I believe that if GM wants to survive in the Auto market they have to cut cost what ever it takes even those it means cutting jobs and getting rid of Union.GM needs to know cut cost or fall into bankrupts.
GM needs to get rid of the UAW. The UAW is hurting GM. GM MUST get rid of the UAW to compete with Toyota. I believe if GM does not get rid of Its union GM may go into bankruptcy
GM is not broke and will not go broke…
Bob,
Good work dumping the French. The last thing GM needs is to be in bed with Renault. Their cars are less than exceptional. Keep building cars like the new Saturn Aura and Sky and new Camaro. You will be just fine….
Our local Chev/Pont/Buick dealer has recently changed hands from a small locally owned business to a much larger multi-dealership owner. The customer service has gone south. Previous services included in their “lube for life program” prepaid (not a free service), have been eliminated. Personally this is not the way to maintain or increase market share.