CEO Mary Barra is shaking up GM,
She’s helping drive a culture change at Big 3 automaker
Mary Barra has only been chairman and CEO of General Motors for three years, but the company she leads today is vastly different from the one she inherited. She has tried to make it more decisive, focused, responsive and responsible.
Barra and a team that combines GM lifers and carefully selected newcomers are creating a company that’s more sensitive to its customers and more focused on profits than ever before. Their vision for GM will be in the spotlight Tuesday at the company’s annual meeting in Detroit.
“We’ve never seen anybody run GM like this. She’s breaking all the rules,” said Rebecca Lindland, executive analyst for Kelley Blue Book.
Phrases such as “customer first” and “good stewards of our owners’ money” are touchstones of the culture growing within GM.
“GM used to be all about sales volume and market share,” Autotrader senior analyst Michelle Krebs said. “Now, if they don’t see a path to profitability and leadership, they get out. The goal is to sell fewer vehicles and make more money. It’s a new GM.”
One of the defining moments of Barra’s tenure occurred when the company accepted responsibility, apologized and essentially wrote a blank check when a GM employee allegedly concealed faulty ignition switches that led to accidents and multiple deaths.
Under Barra’s direction, GM
has:
Aggressively pursued radical new technologies and developing businesses, including ride-sharing, autonomous vehicles and mass-market electric cars.
Shut down money-losing operations in Russia, Australia, India and South Africa.
Sold its massive European operations to France’s Peugeot, essentially exiting a huge, but unprofitable, market.
Put data from customers at the heart of its product development and manufacturing decisions.
Common themes among those decisions include a refusal to let problems fester and an understanding that bright ideas and catchy slogans are meaningless unless GM has the focus and finances to deliver on them.
“The easiest time to solve a problem is when it’s small,” Barra said. “We talk to everybody about that: Raise issues (early) so you can get the help to solve them.”
Barra faces another problem at Tuesday’s shareholders’ meeting, where hedge fund manager David Einhorn’s Greenlight Capital wants to create two classes of GM common stock. Einhorn has said the plan would unlock substantially more value for GM stockholders. GM and key institutional investors are resisting the idea, saying it would strip the company of money it will need to maintain a high level of investment during the next sales downturn.
Barra opposes the idea. The issue could produce a potentially contentious shareholders meeting even though many analysts have said the move would be a bad idea.
Barra was a highly regarded but little-known career engineer — GM’s global product development chief — when she was thrust into the global spotlight as the first female CEO of an automaker. Mobbed like a rock star at auto shows and press conferences, Barra put her head down and kept moving forward.
“My mom and dad raised me and my brother to believe we could do anything we set our minds to,” she said. “They were raised in the Depression, and they so believed in the American Dream.”
When Barra joined GM in 1985, a female chair and CEO of GM was almost inconceivable. GM and all automakers were an old-economy boys club, very unlike the high-tech companies the 21st century demands.
“I didn’t necessarily go, ‘ I’m a woman in the working world,’ ” she said. “I was a person in the working world. I do sit here today because there were people 20 years ago who gave me career opportunities and gave me constructive feedback and allowed me to grow and took risks on me with the jobs they put me in.”
Paying that forward, she’s an avid supporter of New Yorkbased Girls Who Code, a nonprofit group encouraging middle and high school girls to learn computer science. Barra helped introduce the program to metro Detroit schools and has visited some of their meetings. The admiration is mutual.
“I’m a huge fan of Mary Barra,” Girls Who Code founder Reshma Saujani said. “In some ways she’s the ultimate girl who codes.”
GM global product development and purchasing boss Mark Reuss worked alongside Barra for decades. They watched GM management kick problems down the road and make one money-losing decision after another. When the government-overseen bankruptcy gave GM a fresh start after the Great Recession, the two fast-rising executives promised themselves they would not repeat those mistakes.
“GM came out of bankruptcy with a clean slate, none of the baggage that had crippled them,” said Maryann Keller, principal at analyst Maryann Keller & Associates.
“The only liability was cultural issues that allowed them to pretend the bankruptcy had been because of the credit crisis, not management’s own bad decisions.”
“My mom and dad raised me and my brother to believe we could do anything we set our minds to. They were raised in the Depression, and they so believed in the American Dream.” Mary Barra, CEO of General Motors