Lessons for CEOs from Mary Barra’s Ordeal
General Motors CEO Mary Barra’s faced the firing squad during her two days of Congressional testimony last week on the ignition-switch recall fiasco. Now she has to figure out how to pivot to the future – by fixing the culture. It’s all about transparency and authenticity.
April 6 2014 by ChiefExecutive.net
“When it comes to General Motors, it’s not just about a defective switch, it’s about defective leadership at ‘old GM’,” says CEO and corporate culture advisor, Brian Fielkow, author of, Driving to Perfection. “There are fundamental core-value mistakes that are made at the highest levels of a company that lead directly to devastating recalls.” David E. Johnson, CEO of Strategic Vision, LLC, a public relations and branding agency specializing in crisis communications, advises GM to publicize the fact that they are giving loaner cars to customers whose cars are recalled and address the recall in newspaper advertising. He also argues that Barra must continue to be forthcoming, give an idea of what went wrong, how serious it is, when a solution will be found, and address those remarks to the families of the victims. “She owns this crisis now,” Johnson says. “Only openness and candor will help the GM brand. If anything contradicts what Barra has said about knowing about the problem, she needs to be terminated at once.” Further, he says, “GM is going to have to remake itself — again. That is the only way they will regain the public trust over the short term.”
It won’t be long before everyone from other industrial CEOs to MBA students are pouring over case studies of this episode for lessons and clues about how chiefs – especially those new to the responsibility – should handle deep crises not of their own making.
But for now, Barra is living one. Her testimony on Capitol Hill was largely pro forma. Barra accepted corporate blame for the safety fiasco that took at least 13 lives and that has all the hallmarks of a long-running cover-up within the bowels of America’s largest automaker. She agreed with fired-up Congressional inquisitors that there had been plenty of opportunity along the way for people at the company to stop the madness.
And Barra pledged that such a thing would never happen again at GM, a guarantee she would help enforce in part by continuing to launch a new era of “transparency.” But Barra nimbly dodged personal blame for any aspect of the underlying safety problems that she found in GM’s CEO suite when she took over in December And she still managed to deflect lots of the Congressional inquisitors’ questions for legal reasons or for lack of complete information.
Now what does she do? Barra must continue to find ways to get her arms around this crisis – and satisfy increasingly demanding constituencies including regulators, the families of those killed in crashes in the suspect vehicles, the car-buying public, and the news media – without being dragged down by the attachment.
And at the same time, somehow, Barra must turn again to the future of her tenure and her company if she is to survive in the GM CEO spot as other than an asterisk. (“*First female CEO of an auto company; sacrificial lamb for 2014 ignition-recall crisis.”)
David Cole believes Barra will survive and also has some advice for her (and other leaders) to make that happen. The former head of the respected Center for Automotive Research in Ann Arbor, Mich., and one of the most expert continuing students of the industry, Cole had a first-hand view of the machinations that can accompany a top position in GM because he is the son of former GM President Ed Cole.
“She needs to let this die down and then lead some other important, broadening effort beyond GM itself,” Cole told Chief Executive. Barra certainly “can’t suddenly go back and be ‘Miss Safety.’ One thing she could do is lead new efforts to help American kids get involved in manufacturing, which increasingly looks like it’s going to continue to be the backbone of our economy in the future.”
Other pundits also have advice for how Barra should tackle the twin challenges of managing the still-growing recall crisis and making GM a better company in all other aspects as well. Among other things, for instance, Barra must “deal with the culture” at GM that still emphasizes costs over quality, and “learn from the mistakes” already made in the ignition-switch recall debacle, suggested Forbes.com contributor Micheline Maynard.