Part I: Abrogation of the Enterprise’s Principles

Dear General Motors; this means everyone: Executives, workers, board members, retirees, investors, dealers, suppliers, buyers of our brands.

The golden goose is dead. It shouldn’t have come to this, since the General Motors enterprise was built deliberately to be adaptable to any circumstances – to seize opportunities when times were good, and to retrench effectively when times were bad. When did you all decide that this strategic policy was no longer your responsibility?

I’m not going to say that GM should avoid bankruptcy. File today rather than Monday. It is the only avenue that makes sense, and in fact is simply the now-unavoidable admission that the company has been effectively bankrupt for years, but has merely been shifting the evidence from one pocket to another: One year product would be uncompetitive; another year there would be a financial loss. The proliferation of brands and markets added more shells to the game, but eventually it came down to pulling sales ahead from the next quarter by looting GMAC to offer free credit.

There is plenty of blame to go around.
It falls upon every constituency over the course of generations. The union and the dealer body are guilty of sins of commission, in seeking and instituting unfair advantages. The others are guilty of sins of omission, by angling ever for their “piece” of General Motors, even the crumbs.  read more »

(c)2009 Joshua Davidson
by Joshua Davidson
Publisher, MyYearsWithGM.com and the GM Centennial AUDIOBOOK Edition of My Years with General Motors

VIABILITY IS ONLY THE FIRST STEP IN GENERAL MOTORS' EFFORT TO RETAIN ITS POSITION AS A LEADING AUTO MANUFACTURER. LONG-TERM SUCCESS DEMANDS A VISIONARY STRATEGY IMPLEMENTED THROUGH FORWARD-LOOKING POLICIES, WHICH TOGETHER WILL EXPRESS A 21st CENTURY STRATEGIC IDENTITY.

Most historical analysis concentrates on the mistakes GM has made since the 1970s, and attributes them to policies established in the 1920s. While those policies’ obsolescence did indeed fail to meet the dramatic changes that arose five decades after their conception, the fault lies preponderantly in the failure since 1958 to effectively act from established principles of policy creation and recreation – one element of a solid core of timeless enterprise principles originally developed by GM, and which endure as the framework for successful business around the world. Unquestionably, it is imperative to keep a spotlight on past mistakes and guard against their repetition. But focus on avoiding its past failures has also prevented GM from appreciating its own historical success, and obscures the philosophy from where that success originated. Indeed, the great value of GM’s history is less in ensuring vigilance against past mistakes than in illustrating the principles that fueled GM’s success through such volatile times as the Great Depression.  read more » General Motors is unique in having the history of its long success captured in Alfred Sloan’s universally admired memoir, My Years with General Motors. While the details of GM’s advance are fascinating as history, the true value of Sloan’s book to GM’s future is its crystallization of the techniques for creating a current culture of enterprise. In explaining how he and his colleagues approached General Motors’ emergence from its 1920 existential crisis, Sloan writes:

by Joshua Davidson
Publisher, MyYearsWithGM.com and the GM Centennial AUDIOBOOK Edition of My Years with General Motors

GM'S 2008 CENTENNIAL CRISIS STEMS DIRECTLY FROM THE CORPORATION'S 1958 SEMI-CENTENNIAL YEAR, WHEN THE CORPORATION'S GOVERNANCE STRUCTURE EXPERIENCED A SEISMIC SHIFT THAT ENDED A DECADE-LONG INTERNAL WAR, AND ATOMIZED GM'S OWNERSHIP.

1958: TURMOIL AT THE MILESTONE Despite a deep national economic recession and sales slump, GM was far and away the worldwide industry leader. So, while 1958 sales were poor following a decade-long boom, General Motors the corporation ostensibly never looked better, gifting the nation with a two-hour 50th Anniversary TV extravaganza starring dozens of contemporary celebrities.  read more » Of course, the real stars were the all-new 1958 Cadillacs, Buicks, Oldsmobiles, Pontiacs and Chevrolets – considered by many to be the ugliest GM lineup ever. The company that innovated the very idea of production car design had excreted a lineup whose unifying theme seemed to be a Jell-O mould amalgamation of all the tailfins, chromed castings and saturated pastel colors. The ‘58’s were the pinnacle of planned obsolescence, which was never a GM policy, but in fact the signal failure of GM’s policy-making principles.