Comments

Built a brand. New brand. It is the ultimate task.

GM's trouble is not in the technology. GM's trouble is in the marketing, more precisely - in the branding.

My advise - hire the best marketing executive and let him act like the CEO of this new project.

Posted by Linas Simonis, PositioningStrategy at April 4, 2008 1:54 PM

I agree with the sentiment Linas. However, my bias is that the brand is built on the experience, and no amount of hype can repair this brand. Cadillac serves as an example of the ability to rebuild the brand by changing the experience. They have a pretty good lead on this project...the brand issue to me is whether they can fulfill the brand promise they have offered. Thanks for the comments.

Posted by Mike Neiss at April 4, 2008 2:03 PM

My biggest problem with the Volt is that they still don't have the battery for it - yet they have been advertising the specs for 2 years now. Essentially they're saying it's comparable to the electric car they killed in the 90s in terms of range, but can't tell us anything about the battery in 2008.

Posted by Joe Bavonese at April 4, 2008 2:11 PM

Actually Joe, they have had some significant breakthroughs in the battery. Doing this from memory, but the new one is half the weight and size and capable of holding an initial charge for 40 miles. Lithium ion instead of lead cell in the EV1. But true enough, the battery seems to be the key for this and the hydrogen vehicles. GM starts road testing this new vehicle shortly and are making a big deal out of some new testing algorithm to speed battery improvements.

Posted by Mike Neiss at April 4, 2008 2:25 PM

Mike - here are some random thoughts 'off the top of my head' about leadership and innovation at GM in the C21st. First and foremost the world is moving on from Brands.... GM should try to move on too....

I know nothing about building vehicles let alone hybrids. BUT I doubt that this venture will do anything like what you expect because as usual these projects are focussed at the wrong end. This whole project has been designed and is being executed with a C20th mindset. The place to start, to innovate, to establish leadership, etc is at the dealerships and with the public. If the dealerships are not up to presenting and sustaining a new vehicle concept then it will simply fall over. Dealership distribution, consumer acceptance, and sustainability of product is what this project should be all about not Brand.

GM needs to get beyond the traditional thinking of brand and place in the market - it has an opportunity to do what it did in the 1930s when it took on Henry Ford and his T-model success. Back then the great industrial innovator Alfred P Sloan invented a new industry - he carved out several price point and market specific brands for GM with exciting new products, new financing packages, and with a completely new set of dealerships.

Something as bold as that is needed again in the early part of C21st .... Perhaps GM can go beyond 'brand power' and invent a new mode of transport with new and innovative ways to sustain it at its dealerships and at new recharging centers that are purpose built for this new transporter... New product with a new infrastructure sounds a whole lot better than a Saturn like attempt yet again to relaunch the tarnished GM brand.

Richard.

Posted by Richard Lipscombe at April 4, 2008 9:00 PM

Hi Richard, thanks.
I agree, and quite frankly, my whole point is that they cannot launch this vehicle without innovative and new thinking. The intent is to build a new mode of transportation with recharging at your own home. I am not sure that the world is beyond brand...am interested in why you think so. I can't remember a time where brand is more relevant. With every manufacturer becoming better through pursuit of operational excellence, it seems brand to me becomes a definitive criteria for identifying uniqueness. And I don't think Saturn was primarily a marketing or brand experiment. Indeed, we launched that intentionally to be an experiment in new manufacturing techniques, structures, and labor relations. Originally, we intended Saturn dealers to be wholly owned and operated by Saturn employees. Of course, the National Automobile Dealers Association killed that. I actually foresee a point in the future that the dealer does not become the primary face for the manufacturers, and more autos will be ordered through the web direct from the manufacturer. Dealerships represent a huge overhead. Again, in our language, brand is synonymous with reputation and experience. I don't think that ad agencies and clever promotions are the key. When the big three falls out of love (finally) with the combustion engine, I do think we will see a new frontier as exciting as the model T and Sloan's big idea to offer autos in colors other than black.

Posted by Mike Neiss at April 5, 2008 11:12 AM

Mike - again this is all 'off the top of the head stuff' so you will probably get a good laugh or two from it... you will get a further laugh when I tell you now that I believe whatever I am about to write.... go figure!

Brands are dead because they are no longer needed by, nor relevant to, the saavy 2008 consumer who has become far more informed about product and services than his or her dad or mum ever was - the world has, and is, moving on from push marketing (supported by brands) and onto to pull marketing or permission marketing (supported by consumer participation in the production and distribution process - Amazon is a master of it).

People on the net simply do not need brands - brands are more often used these days on Facebook, YouTube, Twitter, etc to say what you loath not what you love about a company and its products or services. There are some icon American brands that are being throughly trashed every minute of every day around the globe because of the bad, poor, or simply ugly experience that consumers are having with their latest offerings - I do not have to name them I am sure!

Most people do not follow or trust brand marketing - they follow and trust the recommendations of their peers, viral or word of mouth marketing, their own or their cohort's experiences, their own or a trust friend's stories, etc.

Dealership is a collective noun for points of distribution - it could refer to points in cyberspace (with virtual assets and almost zero set up, sunk, and variable costs)... Dealership is the 'user interface' between a business and its consumers - it is where vital feedback loops are established with consumers to garner insights into products/services acceptance and acceptability. Good feedback loops are needed by all companies at all times but especially when you launch an innovative new product. The ongoing experience the consumer has with the product is more important than getting the product 100% right in design and production...

In C21st speak it is all about "launch and learn"... Rapid launch and good cyberspace dealership feedback loops with heaps of support for early adopter consumers is not a bad way for GM to be thinking about getting beyond their C20th brand based thinking and execution. Dell Computer are making a good effort to join the C21st having dominated the last part of C20th in their sector and then seeing it all go pear shaped....

Alfred P Sloan did much more in an organisational sense (his new structure was 'tight yet loose', centralised yet decentralised, focused on being highly professional in a time of amateurs, etc) than simply introduce a range of colours to cars to compete with the black T model (he had different cars with different prices that were designed to appeal to different segments of the market and he updated models every year or so to move stock and create new demand).

Sloan is recognised as a true organisational guru for his innovative organisational restructure of GM. I certainly admire what he did in his time - GM needs another Sloan or Two....

What is needed at GM today is a revolution in thinking about its organisation efficiency and effectiveness much more than its product line or its image. GM as an innovative and green manufacturer - sell that image to Americans and Mike you will have a brand worth keeping ... Good luck with that project!

I agree with you Mike, GM is likely to be confined to the annals of history before 2050 unless they can become much more innovative than they have shown any propensity to be so far this century - what was good for GM use to be good for America but it is not anymore. I no longer accept the notion that "as goes GM so goes America" - at least I trust it is no longer true!

Have you picked yourself up of the floor yet Mike - well the good news is you can stop laughing now because I am out of here!

Richard

Posted by Richard Lipscombe at April 5, 2008 5:37 PM

In my blurry knowledge of branding, I have to say I lean toward Richard's perception. My next car, stereo, computer, camera, or house will be what seems like the right level of quality for the right price at that time. Brand comes and goes.

I think about my perception of electric guitars a few years ago. I desperately wanted a Gibson or Gretsch, but mostly, anything but a Fender.

I own two Fenders.

My perception was based on the fact that I first heard about electric guitars in the mid-60s, when Fender had been acquired by CBS and was making, well, lesser quality instruments. (My dad and his brothers called them 'cheap junk.')

Of course nowadays, a fairly inexpensive Stratocaster is a fantastic guitar at a great price, half that of the same quality Gibson or Gretsch (which I still want, of course, if you were thinking of getting me something . . . )

Fender's 'brand' changed 180 degrees from the time I first formed what had been a life-long opinion. But when I started looking, their current state outranked my life-long belief about their brand.

Car buyers in 2010 are going to look at what's the best car for the right price. If GM is making it, it'll sell--but not because it's GM, because it's the right car.

Posted by Joel D Canfield at April 5, 2008 6:06 PM

Hi Mike – fascinating discussion. I have very little knowledge of the car industry but I really like Richard and Joel’s take on this. I think the customer is much smarter nowadays and brand is far less important than it was when the customer was treated like a mushroom (‘kept in the dark and fed on bullshit’) Customers are very much in the driving seat now and will not be conned as easily as a few years back. We all have access to the web and we can see the truth behind the spin. The last 5 new cars I’ve bought have all been Renault’s - so I guess it may look like I’ve become a fan of the Renault brand but if I look more closely and dig a bit more deeply the ‘brand loyalty’ I have is not to Renault but to the particular salesman, Steve, in my Renault garage! – To the extent that since we moved house last year I still go back to Steve 30 miles away rather than a Renault Garage down the road just three miles … Crazy maybe but true ... We customers are fickle folks Mike … we don’t always act rationally … we just need to be loved :- )

Posted by Trevor Gay at April 5, 2008 6:59 PM

Richard, I don't think brands are dead. In that I think that customer still do have perceptions about companies, which are influenced by their experiences. This might mean that brand's definition is not the logo of a company, but rather the customer's perception of a company. I'd use the term brand as short hand for what the customer thinks about a company, but also what the company wants to be. The two of course might not be the same. I believe that in the early days of Volvo, safety was not as important to the company, but it was an important factor for the customers, once Volvo fell in step with the customers, the company became much more successful by pursuing safety for its cars.

Mike, regarding General Motors and American Car Manufacturers in General. I conducted a review of auto blogging communities 2-3 years ago and three topics were top of mind for the auto blogging community.

1. Reviewing cars
2. Green cars
3. Bashing Ford and General Motors

My perception is that a lot of the American public don't like American cars, they have concerns about safety and reliability. Every year Consumer Reports reviews point to non-American cars as the top cars. I think General Motors and Ford have a problem, not just with their own brands, but also how the American public view American cars.

If both companies can address some of their structural issues, both companies have a chance at reviving their fortunes.

What's interesting to me about General Motors story and the rest of the American car industry, is that it sounds very similar to the story of Dell Hell. Except Dell did not face the perception that all American cars are bad by a large proportion of the American car buying public.

I'd like to see General Motors and Ford turn things around. I think they can do it, but I also think both companies should seriously consider using social media for online customer engagement as much as possible. Dell's shown the path forward on this one. Using social media for monitoring, making the structural changes, and using social media to solve customer service and change perceptions customer by customer.

Posted by John Cass at April 5, 2008 7:36 PM

Joel..as an owner of two old Martins and one Kalamazoo Gibson, I think you have made the point for me. You still want a Gibson or a Gretsch...

My point on brands has absolutely nothing to do with marketing. I rarely buy "name" brands, but I am faithful to Nike running shoes, Apple computers, and Titleist Pro V1's. Not because I am taken in by their ads...but because they have continuously lived up to their brand promise. And I am not an apologist for GM...if you have read this blog for any length of time you would know I think the big three got exactly what they deserved by falling in love with cost cutting and making crappy cars (although their parts cost has gone down). Many people continue to buy the Toyota Camry based on reputation...a search of JD Powers will show their quality is not what it used to be and secondary to some domestic product. That's the power of brand. John, Consumer Reports this year has Lincoln and Chevrolet ahead of the imports in their categories. It will take time for them to turn the perception, or brand, around. I quite frankly don't know if they will make it.

Posted by Mike Neiss at April 5, 2008 8:17 PM

Mike...I really appreciate your post and being a fellow Michigander, I am bit nostaglic and indeed hoping that the Big 3 will once again gain a position in the market.

Regarding cost cutting, it appears to me from a rather novice point of view, that GM had not cut its costs enough. I personally know of a man who works on the line, making an incredible six- figure salary for unskilled labor and receiving legacy benefits as health care for his 22 year old adult son. (I'm not sure how these issues are aligned with other costs such as executive costs etc. This too should be considered.) Both unskilled labor costs seem good to me in good times but quite bad in bad times, as does astronomical executive salaries and packages.

The problem is that it appears highly unlikely that cutting such costs would not be politically advisable. I am not suggesting here, by any means, that labor should not be well compensated in times of prosperity. (Do not shoot me down for the "labor" term. Unions are called what? Labor Unions.) What I am suggesting, however, is that all should be willing to do whatever is necessary to compete. I'm not sure if this is really happening.

Such costs as well as, making as you say, "crappy cars" may be together a significant problem. Was Saturn, by the way, suppose to be the answer to GM's problems? Has it been? The aforementioned proud GM auto worker bought a Saturn and has declared after so many problems that he would never buy another one and advises us all not to as well.

Your point about branding aside from marketing seems right on to me. Your point also about the Toyota Camry and branding is well received. It is also good to see that Consumer Reports has brands such as Lincoln and Chevrolet ahead of its competition in quality. (I'm a hometown girl, OK!) It has also been argued by some that, in fact, many imports are not greater than those here as such products have simple reverse engineering except that most of their parts look pretty much like the originals.

And Mike...Yes, They Can!

Posted by Judith Ellis at April 6, 2008 4:56 AM

Yep,with you there on labor costs Judith. The wages within the big three were greatly inflated. However, this was true in the management ranks as well. When I first met my team after being hired by GM I was blown away that management members got overtime. And I had folks with a high school education making near $100K for supervisory positions that paid closer to $40K elsewhere. Not that the education level was the issue here. I don't put that much stock in degrees. And let us not forget Mullaly's 2008 salary at Ford. For many years after my GM experience, I would not drive a US automobile because I had worked on the floor with many of the folks you talked about. Talk about an entitlement attitude! Saturn was to be an answer for GM's structural and product issues. If you trace their history you will find their problems began when GM forced them back into the fold after they dropped the Oldsmobile line. Once traditional GM management got their hands on Saturn, they became just another GM nameplate. After the money people at GM forced changes at Saturn to fit the old GM model, the UAW followed by insisting they return to the old traditional contract and work rules. It was sad, and probably Roger Smith's ultimate legacy. To your friends point, I would still advise people to stay away from most GM brands, with the possible exception of the Buick Enclave, Cadillac, and GMC trucks. I find the positive press on the Malibu to be way overstated. The interior looks like it was made on a vacuform (that will test the age of some of us)

Thanks

Posted by Mike Neiss at April 6, 2008 6:22 AM

I'm also with you, Mike. However, I do put quite a lot of stock in degrees, for more than one reason, though I thoroughly understand that many will not or do not want to attain them. Degrees coupled with experience and the right attitude in fulfilling purposeful work that matters is to me unbeatable.

Posted by Judith Ellis at April 6, 2008 6:59 AM

Judith, I see degrees as evidence of goal orientation and discipline, and extremely important. I am saddened that more than half of the students in Michigan's major metropolitan areas (Grand Rapids, Kalamazoo, Flint, Saginaw, and Detroit) don't even graduate from high school. So, yes, they are important to me. Much of my bias comes from my early management career at UPS where promotions only came from within and what you accomplished was worth far more than what you knew. I don't even recall that we collected personnel data on educational level. I do a fair amount of mentoring with high school students and tell them flat out that a bachelors degree is as necessary today as a high school diploma was in my days.

Posted by Mike Neiss at April 6, 2008 8:00 AM

Do the big 3 "Brands" even manufacture cars any more? Components are outsourced to a 3rd party and then assembled (either locally or by our northern or southern neighbors) by the brand. These 3rd party components are basically the same in most of the domestics. So that type of "brand" to me is mostly a nameplate for marketing which adds little if any value (mostly a negative impact). I do agree with the guy that said he was more aligned with his long time sales guy. For me, I'm much more concerned that my local dealership takes care of me when (not if) the vehicle needs work and that will boil down to 1 or 2 guys in the service area. So maybe tom's idea of "brand you" (personal brand or micro branding) really is more valid. The big brands to me represent the old bureacratic top heavy overpaid executive good old boy corporate greed kind of crap that I don't want. GM or Ford or Chrylser are immaterial if I have those 1 or 2 people with ability to keep getting me from point A to point B. If they don't, and they only get 1 chance to mess up and not fix it immediately, then their brand sucks and I find another 1 or 2 people to make it happen.

Posted by branding bob at April 6, 2008 8:59 AM

Mike...thanks for the clarification. I see we are looking at the same stats. My ideas are always somehow focused on those who will come after us. I think it is possible to make policy with them in mind and be profitable now. These things are not mutually exclusive. By they way, is GM and the others recruiting the best and brightest? Are there incentives for futher corporate education?

Ongoing innovative corporate education for all may not be bad. (I know it's the first thing that goes during a down turn.) I completely understand your experience with management back in the day. With the fast paced innovation of technology such degrees may not be as important as they once were.

I would agree that attaining a degree on the job for its mere sake may not yield the best results. The experience and knowledge may, in fact, be lost, i.e., the focus becomes purely advancement and not knowledge attainment or skills-enhancement. Where are the curious ones? Maybe coaching and mentoring should be the focus. It's perhaps more direct and immediate and more cost-effective.

Posted by Judith Ellis at April 6, 2008 9:10 AM

Branding Bob...while I understand your point about global partners and brands, I also sincerely wonder if there is a sense of national identity anymore.

Not to be provincial... but is it possible today to have national identity and not be exclusionary in thought or action while maintaining free and open trade? Perhaps not in the traditonal sense. Such openness, it has been argued, dispels national identity. (Besides this, the exchange has to be profitable for all.) Perhaps it is the forever changing or re-defining that is important here. So, there is constant change and constant branding depending on internal and external factors. I like this.

Regarding various kinds of brands, it is possible to have personal brands within the general corporate brand. In this sense, brand yous are developed according to ability, potential, and curiosity and given freedom to work within an overall corporate brand. Within this environment, huddles of brand yous can constantly innovate, creatively affecting the corporate brand en masse.

Posted by Judith Ellis at April 6, 2008 10:27 AM

Mike

My point is that GM and others have to accept the changes taking place in our Web 3.0 world. Within the flat world of the internet there is a global networked economy forming. Here the old rules of the game that made Corporate Brands, Brand You, Ideological Branding (left, right, center, liberal, etc), and Nation-State Brands (UK, USA, Canada, Mexico, China, etc)are all losing relevance. Why? Because our new global networked economy is inclusive not exclusive. Brands help with differentiation not integration - with competition not cooperation.

People do not want to become isolates - they want to belong so they are seeking new ways to work, live, and raise families. People act in innovative ways when they feel they really need to and so it is today that we have enormous degrees of raw innovation taking place.

GM leadership, perhaps, needs to better understand (as Dell Computer is trying to understand) that what I have termed the 'Chattering Clusters' are here to stay. They are setting new trends that will become new continuities by 2020. They are forming Clans and Tribes that will largely determine trends and continuities in consumer demand.

The Chattering Clusters will have a heavy influence on work & family life, politics, fashion, ideas, marketing, selling, networking, and social mores. They will become the 'hidden hand' of social and economic reform over the next two decades. They will become known as the consumers who make purchasing decisions in less time than it takes them to blink - what I term the nanosecond consumers.

So this is how I see it evolving.... Chattering Clusters are the core of social networks on the web - they are on Twitter, Facebook, MySpace, Linkedin, etc. They are constantly chattering to each other as a social network - these networks have Clans forming and imploding within them each day. These Clans are socio-economic entities - members influence each others' social and economic behaviours. Clans form into Tribes. Tribes have members who seek much more face to face contact than Clan members - they form purpose-driven working groups. Tribes are focussed on achievement - they have goals, commitments, and projects. Tribes tend to make it real or implode.

That all potents a big change... A big set of changes for GM leadership and the US car industry..... But I agree GM leadership can do it - of course if they do not do it then some one will do it for them or to them.

Richard

Posted by Richard Lipscombe at April 6, 2008 5:23 PM

Excellent points made here. It sounds like we're increasingly moving into a one global world order where consumerism is its God and cable vacancy its mode of being. Yippee!

Undoubtedly in the described world of clans and tribes (consider those that already exists) there will be lefts, rights, centers, and perhaps stricter control. (It's like once you have ordered from Amazon, they "know" you. Is this community?) Technology will not change human behavior. Culture does. Technology, though, influences the speed of messages and develops some sort of community sooner.

Regarding branding, the issue of being for me is essential. Brand Yous will never lose relevancy. Brand Yous are us and through extension our companies. When I read the Brand You article 10+ years ago it struck me so profoundly because of the implication of the significance of being.

Even with technology there will always be the need of both the individual and collective which is probably in its deepest sense face to face…hence, the importance of personal and corporate brands. (Technology has an important role here too.) Is it the assumption that we ourselves will become the corporate brands through technology? If so, I'm not sure if an inanimate can become animate, at least not yet.

I do believe that it is very possible to celebrate differences, commune, and have national identity. For example, here in the States as in other places, even though we are all Americans, there are big differences between cities and states. We root for various sports teams; we choose various political leaders; we have various industries; we have different cultures. Although we are one, there are many.

Having gone to the University of Michigan, I root for Michigan, even though I give also root for Michigan State on occasion, though NEVER for Ohio State. The Wolverines is my team. Now, it should not be assumed that because I'm rooting for Michigan that we cannot learn from the other teams, run similar plays, even hang out after championships. Pray tell, what are the implications of the described clans and tribes on games such as the Olympics, will it come to naught? Who might the competition be?

There is something to be said for preference, competition, and individuality that do not have negative connotations. I'm not sure if I'm into the clans or tribes as described and maybe what I'm into is not significant. This may be indeed be where we're heading. Traditionally, however, there is very little choice and independence there.

Brand Yous are brilliant. They are individual and in corporate settings collective. These are the huddles to which I referred. Perhaps these clans and tribes can be huddles?

Posted by Judith Ellis at April 6, 2008 7:44 PM

Mike...I hope I haven't strayed terribly far from your original post.

Posted by Judith Ellis at April 6, 2008 7:55 PM

Sometimes the Brand dies.
Sometimes we loose our loyalty.
Others just do it better!
Ah! well.

The UK Car industry, infact the global car industry is just mix and match under the skin!

Another day another brand....

Posted by Patrick at April 7, 2008 4:04 AM

True that, Patrick!

Posted by Judith Ellis at April 7, 2008 4:49 AM

Judith, as long as you give proper due to the Spartans, feel free to roam anywhere...:)

Posted by Mike Neiss at April 7, 2008 5:30 AM

I thought I remembered you, Mike, being on that side of the court. A big shout out to the Spartans basketball coach, Izzo, for not only what he accomplishes through his players on the court but in the lives of young people in the community as well.

Posted by Judith Ellis at April 7, 2008 6:15 AM

Zero Point energy car
** Thunder Mind **

There is only air, no fuel, no elecrticity, no gas, no ethanol.

Like UFO's
http://www.amazon.com/Promise-Fred-Bell/dp/0938294075

Posted by Ina at April 7, 2008 7:58 AM

My next car will most likely be a Mercedes. Why? Because it's a good car, reliable, reasonable cost / performance ratio and the dealer's great. In other words, everything about it is OK but the dealer makes my overall car experience better and wins it my loyalty.

My next car will not be a GM (or Vauxhall as we call them in the UK). My wife has one, it's a bit disappointing and the dealer is so offhand and couldn't care less that I probably wouldn't buy anything from him, even if it was the best car in the world.

Mercedes in the UK realised this issue a few years ago and purchased back all their dealership franchises. Merc dealers are now Merc people and it makes a massive difference.

Posted by Mark JF at April 7, 2008 8:51 AM

The reality is that it is all about image. GM couldn't care less if the Volt succeeds or not. In fact, I don't believe they want it to. What they want is to be lauded for their "green" efforts and then when the car hits the showrooms and stays there (because it is too small, underpowered, overpriced, and just plain sucks) they can claim that they tried to produce an environmentally neutral car but the American public didn't want it. Then they will put more effort into a bigger Silverado. Mark my words.

Posted by Skeptic at April 7, 2008 9:09 AM

Skeptic, I will shed few tears if GM blows up. I don't think they will disappear, just be broken up into several companies that might be taken over. But I have to give them a chance. In concept the Volt is revolutionary in its innovation. Certainly not underpowered if you look at what the competition is developing. I am not sure there is one auto producer who I would call socially responsible. I wonder if they do fail, whether the Feds will bail them out too.

Posted by Mike Neiss at April 7, 2008 9:15 AM

MarkJF...it's good to hear from you. Too bad that Diamler did not seem to have the skill or will to run an American company well. From what I have personally gathered, their tenure with Chyrsler was a big disappointment, mainly because they did not consider the American mindset or culture.

Diamler appeared to have run Chrysler like a German company and dealt with the executives, managers, and employees as such. Diamler also did not gain much respect with customers, management and employees on the line for the way in which they spun this "merger of equals" which was obviously not the case. (If I'm not mistaken, their venerable market share has decreased.) There were undoubtedly other factors to consider as well.

But I have always loved the Mercedes brand for its style, longevity, and service. You don't usally see Mercedes on the side of the road. I don't think you will have an argument with too many people with this brand.

Posted by Judith Ellis at April 7, 2008 9:32 AM

Socially conscious? Maybe through their foundations. Many foundations have done truly good work. Environmentally conscious? A large part of one of the small firms that I own has an environmental component. In fact, a partner is a rather esteemed enviromental engineer.

It's amazing how much toxic waste is found after an auto company or a steel company has once been there and nothing can be done because the land is sold through contracts that cannot be disputed after the purchase of the land. Many builders have lost a pretty penny buying such land and having to reduce other important costs because of the clean-up necessary.

Regarding car emissions and the like, I have no knowledge or experience.

Posted by Judith Ellis at April 7, 2008 10:02 AM

When the bean counters/CEOs are replaced by "real car"/creative/innovative guys, GM will do much better. The last five decades with accountants at the top has been disastrous.

Posted by mano appapillai at April 9, 2008 8:03 AM

Mano...the same has been said about Chrysler with Nardelli at the helm. It is being argued that a car man needs to run a car company. It is also being said that those who have been there in various engineering capacities could assist the likes of Nardelli, if they would only listen. I've also heard it said that radical innovation is needed, not the re-arranging of chairs on the titanic. I might add, that as I am not personally involved, I do not have a personal opinion.

Posted by Judith Ellis at April 9, 2008 9:20 AM

Great thread. Loved the discussion of brands. Mike, there's a book here that's begging for an author (that would be you). You could ask blog readers for the best title. I think you already have your subtitle: The Rise & Fall of GM.

Posted by John O'Leary at April 9, 2008 9:54 AM

Mike...regarding your comment about GM selling its divisions off, I spoke with senior executive friend of mine last night. He said that this is probably unlikely because of the economy of scales, apparently one platform fits many. It would not be profitable for GM. Any other suggestions?

Posted by Judith Ellis at April 9, 2008 10:56 AM

Mano...one of my suggestions was to retain Bob Stempel, a former CEO who came out of product development and engineering...the anti bean counter. John actually thinking about doing a book about rock and roll and business ...tee hee. Judith, very quietly, years ago Toyota played with buying Chevrolet division. Of course the senior execs see this as not palatable...that would be the ultimate defeat. And let us remember that one shared platform brand, Oldsmobile, was jettisoned by GM already. Who knows? And Judith, I personally think Nardelli was the absolute worst choice for Chrysler...checked out Home Depot's customer satisfaction ratings lately? I drive a Chrysler product, but think Nardelli was brought in to get the company ready to flip.

Posted by Mike Neiss at April 9, 2008 3:09 PM

Separate business unit with maximum autonomy. It's probably not feasible for it to have its own manufacturing, but the General Manager should have direct control over engineering, styling, and marketing for the product.

Sold initially only by a small, selected subset of dealers (unless there are contractual or regulatory prohibitions against this)...the business unit General Manager picks who they are and whether they get retained as representatives for this product line.

Extremely senior executive (Lutz?) as the business unit GM.

Posted by david foster at April 13, 2008 11:26 AM

Getting to know a manufacturing plant of Toyota will tell you a great deal. They don’t call it “assembly plant,” they get furious. They say they build vehicles fully there. Toyota of Japan’s ownership in said plant was 90%.

Seeing the car crafting and understanding the Kaisen method (total quality assurance proprietary to –and as per-- Toyota) is even more telling.

They pay enormous attention to (a) minuteness (towards perfection), (b) all the flexibility required as long as standards, benchmarks, and protocols are not 1% damaged, © their cultural ethos is 150% integrated, welcoming all kinds of diversity and plurality, (d) there is permanent call to subvert the “innovation status quo,” respectfully. Subvert the order is okay if you do it amicably and THROUGH TRANSPARENT COOPERATION (a là wiki).

To Toyota, the card and hence the brand is about Samurai honor, from ageless times. When something goes wrong for a client, and the client becomes aware of it, they are so embarrassed that they do not know how to wash their face. They, nonetheless, fix it radically.

Each bad process, each ill part, each poor design carries the name of the worker and that of the family. It’s about selling globally-sophisticated cars HONORABLY. The lowest-level worker at Toyota, even the ones into building maintenance, feel that if the company goes wrong their legacy and that of their forefathers will be dishonored eternally. There is similar case with the Apollo Program.

Kennedy was invited by Werner von Braun to visit the nascent NASA and to presence a test for rocket’s engine. Kennedy bumped into a worker who was relentlessly polishing the floor and asked him, “What are you doing here?” The employee immediately replied, “Mister President, making sure we place a man on the Moon.” This Toyota, as well, learned from NASA (diffuse knowledge) as they learned a lot, too, from Henry Ford (concentrated knowledge).

Back in WWII, the Japanese call upon Deming, Juran, and others to learn well the quality staff. The capture, without shame, the American way of quality assurance. They start paying up attention to the granularity of details. In parallel with the aforementioned, they were making copies or bad copies of American automobiles. What did they do the very latter for? To capture a myriad of ‘lesson learned’ to be documented and revised and improve and enhance with million iterations of serendipitous and pseudo-serendipitous “errors and trials” experimentations.

Toyota sells one Honor, Excitement, and Experience, turning the customer into a “prosumer,” with a built-in interest to get Toyota further away into rogue optimization.

GM, and the talented people of it, could start by reverse-engineering the as-of-now Toyota and the respective talented employee. This I so to begin with.

Many less models of automobiles while fixing the mind-setting in (i) perfection, and (ii) environmental. It’s time for GM to cross-sourced from NASA, DARPA, MIT, The San Diego Innovation Hubs, and, clearly, Silicon Valley, so forth.

Posted by Andres Agostini at April 17, 2008 1:05 PM