In Defense of GM – Part 2

The Big 3 bailout efforts seem to be making progress this week, despite the highly publicized criticism of the automakers by every major politician and journalist.  From President Elect Obama’s interview on Meet the Press to Thomas Friedman’s blog on the NY Times to Andrew Horowitz discussion on MSN Money, everyone is having fun taking shots at the automakers.  Of course, General Motors, being the largest of the three automakers, receives the majority of the criticism.  Reading many of these articles I think many people have the impression that GM management has been sitting around doing nothing over the past three decades.  While there can be no dispute that GM’s strategy has not been successful, it should be noted that GM’s management has enacted a number of highly innovative approaches to combat its situation.  In my last post, I started to list 10 Innovative Business Strategies the Automaker has implemented since 1975.   In this post, I will continue the list with the remaining 5 (#6-10):

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In Defense of GM – Part 1

Many of GM’s critics attack the automaker for a lack of focus on quality assurance, product innovation and financial discipline.  Reviewing GM’s financial results from the past 30 years would make it difficult for anyone to argue that the company’s strategy has been successful.  However, I do not agree with the statement that GM has not implemented innovative business strategies to attempt to counteract the competitive pressures it faces.  A review of the OEM’s operations from 1975 through today unveils a number of groundbreaking approaches GM introduced to its product line, manufacturing strategy and corporate structure.  So I have to take issue with the characterization popular in the media of GM as a lumbering giant hopelessly in search of a strategy.  I think many people underestimate the challenges GM has confronted in the past 30 years, which are some of the most difficult issues facing the US economy and society.  I cannot think of another company that has been more impacted by changes in energy policy, environmental concerns, international trade and globalization.  Nor can I think of a single organization which has confronted more challenging issues with labor relations, corporate governance and health care.   In many of these categories GM has pioneered new techniques for approaching these problems that will be replicated by others for years to come. 

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10 Things Most People Don’t Know about GM

This week is arguably one of the most historic in the history of the US automotive industry as the Big 3 will submit their recommendations for Federal aid to Congress.  Of course, this week is just one of many in 2008 that have brought the automotive sector to the brink of catastrophe with record oil prices; evaporating credit markets and unprecedented sales declines.  However, there have been some positive events such as GM’s 100th anniversary which it celebrated on September 15th.

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