- The Washington Times - Saturday, December 5, 2009

DETROIT | When auto industry veteran Bob Lutz returned to General Motors in 2001 after 30 years with other companies, he quickly grew tired of GM’s numbers-oriented bureaucracy, printing up Post-it notes that asked, “Says Who?”

Mr. Lutz stuck his credo on walls and bulletin boards as he publicly challenged the lumbering corporate culture.

In announcing another sudden management overhaul on Friday, GM Chairman and acting CEO Edward Whitacre Jr. was speaking Mr. Lutz’s words when he told employees that the bureaucracy needs to end and they can take reasonable risks without fear of being fired.

“We want you to step up. We don’t want any bureaucracy,” Mr. Whitacre said in his folksy Texas drawl to about 800 GM workers. “We’re not going to make it if you won’t take a risk,” he said in the address, which was broadcast to employees worldwide on the Internet.

Mr. Whitacre, 68, who has been frustrated with the pace of change, appointed Mr. Lutz, 77, as a top adviser, creating an alliance of hard-charging veteran executives to lead the troubled company.

The former CEO of AT&T; Inc., Mr. Whitacre heads a board that just pushed out CEOFrederick A. “Fritz” Henderson after only eight months in office.

In his 45-minute speech, Mr. Whitacre reversed several changes that Mr. Henderson had made, restoring the position of North American president and rejoining the sales and marketing divisions, which had been split in two.

Mr. Whitacre, wearing a charcoal pinstriped suit, paced across a stage, encouraging workers to make changes and get things done quickly. Several times he was self-deprecating, acknowledging that he knows little about cars and would need help from workers.

Mr. Whitacre made clear he would rely on Mr. Lutz to craft GM’s future and teach him the business. Mr. Lutz is known best for leading Chrysler’s wild success in the late 1990s with the introduction of a new 300 luxury sedan and an aggressively designed Ram pickup truck.

But while his new job gives him Mr. Whitacre’s ear, he loses responsibility for marketing, which Mr. Lutz was granted when Mr. Henderson persuaded him to postpone retirement earlier this year.

“It could be his exit package,” said Gerald Meyers, a former chairman of American Motors Corp. who now teaches at the University of Michigan. “You think of it in business terms, he’s moved to a position where he isn’t going to run anything. That’s not too exciting.”

Mr. Whitacre, saying he is sick of ideas sitting on desks “while we wrangle,” elevated many of the company’s younger executives. Among them is Mark Reuss, 46, who for a short time ran engineering and was named president of North America on Friday. Susan Docherty, 47, the former sales chief, was picked to head sales and marketing. Mr. Whitacre also named Nick Reilly president of GM’s European operations.

The changes came so fast that Mr. Whitacre didn’t know how to pronounce the name of Karl-Friedrich Stracke, the man he appointed to head global engineering. He also appeared to be meeting Denise Johnson, the new vice president of labor relations, for the first time. Stephen Girsky, the only one of GM’s 12 board members with automotive experience, also was named a special adviser to Mr. Whitacre.

During the address, Mr. Whitacre said he is open to suggestions and encouraged employees to ask questions and communicate.

That’s in contrast to the way he managed in building regional phone company Southwestern Bell into a giant that eventually acquired AT&T;, according to analysts.

Dave Burstein, editor of the DSL Prime broadband industry newsletter, said that at AT&T;, Mr. Whitacre brooked no disagreement about who was in charge. “If you don’t take orders, Whitacre doesn’t want you,” he said.

c Dan Strumpf and Peter Svensson contributed to this report.

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