As the president's top auto industry adviser, Steven Rattner got an outsider's view inside GM -- which looked like a car wreck at times, he writes in The New York Times.
The company internal report on its response to a deadly ignition switch defect reminds him of "a dysfunctional culture [that] had direct and disastrous consequences for the quality of decision-making", Rattner writes Thursday in a commentary headlined "GM's Flawed Culture."
Looking under the hood of GM was the most stunningly disappointing dissection of a member of corporate America in my 30-year Wall Street career. . . .
Emblematic of the company’s lack of management accountability was the insistence of its chief executive officer, G. Richard Wagoner Jr., that its problems were all the fault of external forces: its unions, oil prices, the credit crisis and competition from Japanese imports.
Yet its arch-rival, Ford, facing that very same list of challenges, avoided bankruptcy and a government handout.
Rattner, lead adviser to the Presidential Task Force on the Auto Industry for five months in 2009, says the GM report released June 5 has echoes of problems his Treasury Department team saw.:
- The empty gestures known as the “GM nod” and the “GM salute.”
- The reluctance to deliver bad news up the management chain.
- The over-reliance on superficial PowerPoint presentations.
- The lack of communication among different slices of an overstuffed bureaucracy.
He gives a vivid example:
Soon after I arrived at Treasury, I saw firsthand GM's problems when it proposed injecting yet more capital into one of its far-flung, loss-making subsidiaries, without any analysis of why the additional investment made sense.
It was just more of the get-along, go-along GM way of shoving money at a problem in the hope that it would go away.
Rattner believes current CEO Mary Barra "faces her own challenges" in trying to tilt traditions in a new direction. "Without getting the culture right, GM can never be declared fully healed," he concludes. "That is still a work in progress."
-- Alan Stamm