3 Things GM's Mary Barra Must Do To End The Recall Crisis

Apr 1 2014, 10:18am CDT | by

3 Things GM's Mary Barra Must Do To End The Recall Crisis
Photo Credit: Forbes Auto

Tuesday and Wednesday are General Motors CEO Mary Barra’s days in the Congressional hot seat. As with her predecessors in Detroit and Tokyo, Barra can expect the blare of camera lights, admonishment from lawmakers, achingly sad stories from accident victims and a lot of pontificating from pundits who’ve never written a word about the GM recall crisis.

These are days that make or break careers. Already, there is plenty of discussion about whether GM’s new chief executive, in her third month on the job, will survive the recall crisis that has swept the largest U.S. automaker. On Monday, GM widened its recall-related charges to $750 million for the first quarter, and it announced yet more recalls, bringing the total to 6.1 million since February.

In another era, there would be no question that GM would lock arms behind its CEO, protecting him (since Barra is the first woman) from the slings and arrows. But Barra comes at a time when GM CEOs are disposable. There have been five in the past five years, making the entrance to GM’s Renaissance Center headquarters a revolving door.

But Barra still has plenty of influence as she sits at those Congressional hearing tables, and the way she uses it will determine how GM handles the crisis. Here are three things she must do this week, and in coming weeks, to stop the recall crisis.

1) Provide complete transparency. Barra has become the public face of GM’s recall, and as such, she cannot fall back on spin. She has apologized numerous times, and will again before Congress. But apologies are empty if there is not a way to see what the CEO is apologizing for.

At this moment in time, the best strategy is to be completely transparent. Legal considerations aside, make documents available. Construct a detailed timeline of what happened and why. Although GM has set up a website for information about the recall, journalists from Automotive News, Bloomberg and the Wall Street Journal are among those setting the narrative, thanks to their diligent reporting. Without transparency, GM will never get control of its own story.

2) Deal with the culture. For years, everyone covering GM has heard company executives insist that the old, bureaucratic GM is gone. GM’s previous CEO, Daniel Akerson, spoke repeatedly about his quest for change. And yet, if the recall reports are even a shred true, the Old GM is alive and well. Engineers decide to make fixes and don’t change part numbers in order to cover their tracks. Cost cutting still prevails over quality. And no one tells the CEO what’s going on, given that Barra learned of the situation only upon her promotion. We haven’t heard yet from Akerson, which might clear up how much information got to the top.

It’s no longer sufficient for Barra to be another member of the Greek Chorus contending GM has changed. She has to be a different kind of GM CEO (with apologies to Saturn). Barra has already been in the public eye more on this recall than other executives might have been, with the exception of Jacques Nasser at Ford more than a decade ago. She sets the tone for the company, but she also needs to write the music. Barra’s chance to finally fix the way GM does things has come.

3) Learn from the mistakes. In 2012, GM encountered a mini-version of what’s now happening, and it bungled its response. It discovered that its chief marketing officer, Joel Ewanick, improperly handled a contract making GM the sponsor of Manchester United, the world’s most valuable sports team. Instead of openly explaining what happened, GM conducted a whisper campaign. Senior executives made off the record phone calls to journalists, blaming him alone for the situation, when GM’s own culture was a contributor.

GM can’t act that way this time. The recall crisis isn’t the fault of the media, errant drivers or untrustworthy suppliers. The fault lies within itself. As Barra herself has said , “Terrible things happened.” Barra, and others, have to learn from the mistakes made in the way the ignition situation was handled internally, and implement changes to keep them from happening again.

That’s a tall order, as evidenced by how wide and deep the reports show GM’s problems to be. But if GM is to prove that President Obama was right to spend $50 billion to fix the company, it’s imperative that GM root out these issues, and resolve them. Only then, can Barra stop the recall crisis.

Source: Forbes Auto

 
 

Don't miss ...

 

<a href="/latest_stories/all/all/30" rel="author">Forbes</a>
Forbes is among the most trusted resources for the world's business and investment leaders, providing them the uncompromising commentary, concise analysis, relevant tools and real-time reporting they need to succeed at work, profit from investing and have fun with the rewards of winning.

 

blog comments powered by Disqus

Latest stories

Vision Without Execution Is Just Hallucination
Vision Without Execution Is Just Hallucination
The title of this blog post is actually the favorite saying of serial entrepreneur, Steve Adams (thanks, Steve), and one of his heroes, Thomas Edison. A great vision is the table stakes for building a valuable business...
 
 
Interesting GM Put And Call Options For March 2015
Interesting GM Put And Call Options For March 2015
Investors in General Motors Co. (NYSE: GM) saw new options begin trading this week, for the March 2015 expiration. One of the key data points that goes into the price an option buyer is willing to pay, is the time value...
 
 
Moses Was Wrong. Avoid Sprawl. Infill Cities (And Teams).
Moses Was Wrong. Avoid Sprawl. Infill Cities (And Teams).
Social and business communities thrive in close proximity. Yet, as Robert Caro explained long ago in The Power Broker, Robert Moses had a bias to build things like parkways and bridges that enabled cars and their...
 
 
What Marketers Can Learn From Airbnb's Attempt To Rebrand
What Marketers Can Learn From Airbnb's Attempt To Rebrand
Marketers don’t cut people open, design cars that can crash, handle hazardous waste or fly into war zones. Relatively speaking, it’s a low-stakes profession. The job is varied and fast-paced, pays well, and has shorter...
 
 
 

Latest from the Network

Vision Without Execution Is Just Hallucination
The title of this blog post is actually the favorite saying of serial entrepreneur, Steve Adams (thanks, Steve), and one of his heroes, Thomas Edison. A great vision is the table stakes for building a valuable business...
Read more on Auto Balla
 
Interesting GM Put And Call Options For March 2015
Investors in General Motors Co. (NYSE: GM) saw new options begin trading this week, for the March 2015 expiration. One of the key data points that goes into the price an option buyer is willing to pay, is the time value...
Read more on Auto Balla
 
Moses Was Wrong. Avoid Sprawl. Infill Cities (And Teams).
Social and business communities thrive in close proximity. Yet, as Robert Caro explained long ago in The Power Broker, Robert Moses had a bias to build things like parkways and bridges that enabled cars and their...
Read more on Auto Balla
 
High salt ups heart disease risk in diabetics
Tokyo, July 23 (IANS) People with Type-2 diabetes have more to add to their list of dietary restrictions as researchers have found that a high salt diet may double their risk of developing cardiovascular disease. "The...
Read more on Apple Balla
 
Chinese meat scam now hits Japanese supermarket chain
Tokyo/Beijing, July 23 (IANS) The 24-hour Japanese convenience chain FamilyMart announced Wednesday it has stopped buying chicken from the Chinese company Husi, which was shut down after selling meat past its expiry...
Read more on Politics Balla
 
McAdams cringes at her 'Notebook' audition tape
Los Angeles, July 23 (IANS) Actress Rachel McAdam couldn't hide her embarrassment while watching her 12-year-old audition tape for the film "The Notebook". Matt Lauer, the host of "Today" show, surprised the actress...
Read more on Celebrity Balla
 
Temperature rise affecting India's wheat production: Study
London, July 23 (IANS) The recent rise in temperatures is taking a toll on India's wheat production, an alarming study by geographers at the University of Southampton in Britain said. A rise in night time temperatures...
Read more on Politics Balla
 
'Little Big Man' author Thomas Berger dead
New York, July 23 (IANS) Author Thomas Berger, best known for his book "Little Big Man", is dead. He was 89. The versatile wordsmith, who penned about 20 bestsellers in his lifetime ranging from detective stories to...
Read more on Celebrity Balla
 
Creating specialised crystals with milk, fog
Washington, July 23 (IANS) Creating highly purified crystals to make high-powered lenses, specialised optics and computers for consumers can no longer be a difficult and expensive method. Researchers at Princeton and...
Read more on Apple Balla
 
Condom that fights sexually-transmitted diseases
Melbourne, July 23 (IANS) Imagine a condom that not only stops pregnancy but also kills germs that can lead to sexually transmitted diseases (STDs). A condom like this has just received approval for mass production in...
Read more on Apple Balla