Comments

Why does God hate Detroit? Two words - UAW and Democrats. There are a several other words like "really bad management" but I think the first two just about sums it up.

Posted by Mike Smock at December 22, 2008 11:47 AM

Mike, I assume you didn't vote for John Kerry in 2004? And your Dad didn't pull the lever for George McGovern in 1972? And your Granddad was a Hoover man in '32, right? And there's no shrine to Jimmy Hoffa in your spare bedroom?

Posted by tom peters at December 22, 2008 12:03 PM

Tom - you really have to start supporting Manchester United - the best football team in the world! http://www.simplicityitk.blogspot.com/

I'm talking REAL football (soccer) .. the game we invented here in England - a game for real men in which we don't wear all that girlie padding ...

Just joking ... Seasons Greetings.

Posted by Trevor Gay at December 22, 2008 12:13 PM

Tom....

The Detroit Lions have the perfect opportunity to build a champion team by 2015. They will need good administration, marketing, on field grunt, coaches, etc. The same is true for the Big Three car companies.

Surely God in his infinite wisdom has merely thrown down the gauntlet to both the football team and the GM, Ford, and Chrysler teams to re-invent themselves in ways that are relevant and remarkable in the C21st...

I once saw a sign on a Church - it should perhaps be on one in Detroit right now - that summed it all up. "I asked God to relieve me of some of my heavy load... he sent me broader shoulders!"

Richard.

Posted by Richard Lipscombe at December 22, 2008 3:21 PM

TP has asked a good question. I must admit to laughing hysterically when I saw a sign at the Lions game which read "The Detroit Lions need a bailout." I thought that was way funny! Undoubtedly, there needs to be a change in the coaching staff. Speaking of football, my alma mater Michigan is going through a bit of a transition with a new coach but you can be assured we'll be back to give the likes of Ohio State a good ole fashion beat down at The Big House or even their house.

Before I say anymore let me insist that honor be given to your father and mother without which there would arguably be no modern mass production, traffic lights, or mainstream popular music of any consequence today. Can you say R&B, Soul, and Hip Hop--out of which other modern popular musical forms may not be? There would arguably be no basics or innovation from which to work.

Regarding the Big Three, it can be argued that many foreign manufacturers are simply reverse engineering Detroit products, in essence, making them their own not through their own innovation, including hybrid vehicles. There is, of course, the design element to consider also. What do customers want to buy? Perhaps Detroit has not done incredibly well on this front, although the Chrysler 300 has sold pretty well and it is not particularly a small vehicle.

For me, the auto bailout was a question of both jobs and the dependence on foreign products for our very way of life. This is not Europe or Japan where there is not an equivalency of land mass, nor the need for so many cars. Cars are obligatory here. Choice is good, but a choice of only foreign products seems completely foolish.

Enough already about European football; we simply are not terribly interested. Not even the great Beckham could interest us in this sport, though there are a great many kiddy leagues here. (Having 26 nieces and nephews, I've been to my share of socceer games, believe me!) I gather Beckham and Posh Spice are on their way back to Europe. What a smashing hit they were. I guess celebrity ain’t good enough, neither is Remembrance of Things Past.

Detroit has to compete and innovate. A friend who is an engineering senior executive at one of the Big Three is thrilled with the opportunity to innovate and compete. (Even though many foreign manufacturers have received tax breaks the likes of no American company, not to mention continuous government subsidy they receive.)

Today Toyota projected a $1.7 billion dollar loss, the first since 1941. God, I guess, is a little miffed at them too.

Posted by Judith Ellis at December 22, 2008 3:56 PM

Reminded recently that my home town of Detroit was the Silicon Valley of the first fifty years of the twentieth century, I had an evil thought. I wonder whether Silicon valley is liable to die and need a major bailout 40 years from now?

I must confess that though I left Detroit in 1959 with the love of my life (still the love of my life in her seventies), I never returned, except for consulting projects that I've worked on for the last 4 -6 years. Yet, though the utter failures of the industry and american unionization bug me, I always remember what a phenomenal world it was in the 40s and 50s. Everything from Grand Opera to Bennie Osterbaan and the Michigan Football teams. And if you've never stood at the top of the Michigan stadium and looked down into that vast chasm, you don't know what a monstrous stadium is. A library system with kid attention going out of style. And an art institute with personal attention for kids from the finely educated curators. And that marvelous Detroit symphony with Eastern European exiles that that Hitler and the Russians had sent our way.

And the grade schools---oh my god!!! Teachers with grad degrees from Michigan, and other marvelous schools. My civics teacher in junior high was a PhD from an east coast school. And when Truman fired McArthur she marched off to Washington to check it out with her college roommate who was a leading journalist. Boy, did we have first hand information. And who ever heard of classes with less than 25 kids--throughout the entire school system. Elementary schools with swimming pool, two gyms, outdoor ice skating rink, and a kindergarten room with huge fireplace and European tiles around it. Now them's resources the like of which practically no one has ever seen and ever will again. Perhaps all of that is why at my 50th anniversary high school reunion, I found out that more than 50% of my classmates were college grads--and that in a generation where only 12% on average graduated from college. A class of 250 with 9 phd., 25 engineers, 3 physicians, and on and on and on. The world will never see it again.

So I guess we shouldn't be too hard on the auto industry!!??!

Posted by Dan Erwin at December 22, 2008 4:28 PM

Ah, thank you so much for that Dan. I grew up in Detroit in the mid 70's and have lived in other places in the U.S. including New York and San Fransico and in many other places throughout the world. Detroit remains home.

Dan, if you're ever back in Detroit on business I can get you the best seats at the Detroit Opera House. It will be my pleasure.

Posted by Judith Ellis at December 22, 2008 5:11 PM

Judith: I just might take you up on that! Delightful

Posted by Dan Erwin at December 22, 2008 5:25 PM

Mike Smock has it right - UAW union & labor; & their Democrat support. US airlines, autos & public schools - all failing for decades & beholden to the Peters & Ellis neoleftist Democrats' deviance & perversion (similar words per Jack Welch for the 3 failures). Plus Detroit is always a top 3 murder capital locale - thanks Judith to the brothers for that & Chicago too - home of the corruption moving ever closer to your president elect - thanks again! Once spent a month one weekend in Detroit! :>)

Posted by Contraire at December 22, 2008 5:26 PM

Tom & I love the UAW because they provide free Cialus as part of "healthcare coverage" & we are in on that pipeline! Thanks Judith that the laid off for months auto workers collect 95% of their salary - perfect Detroit madness - the citizen taxpayers love you all & Mo Town madly! :>)

Posted by Contraire at December 22, 2008 5:36 PM

Dan - Just check out the DOH schedule online and let me know how many tickets and I'll be happy to arrange it. The schedule includes more than opera; the dance series is great! You may contact me through my blog. Pleasure.

Posted by Judith Ellis at December 22, 2008 5:36 PM

Between this blog and several comments on news sites that allow readers to post comments, I have seen a lot of arguments for and (mostly) against a big three bailout that are not based on reality. These include comments on quality, fuel economy, relative sales figures, etc., with zealots on both sides not looking at the facts. Here are some realities:

(1) The quality and reliability of Ford, GM and even Chrysler has improved tremendously over the past several years and is in many cases equal to and better than the competition. For proof look at Consumers Reports, JD Powers, et al.
(2) Both Ford and GM make several fuel efficient small cars and trucks (e.g. Ford Focus, Escape and Ranger) and GM has more 40 mpg (highway) rated vehicles than any other manufacturer (OK, OK, some of them are the same basic car with three different brand names but you get the idea). Both make hybrids, including the excellent Ford Escape Hybrid. On the flip side of the coin, Honda, Toyota and Nissan all make big gas guzzling pickups and SUV's. The impressions that some people have that Detroit ONLY makes huge gas guzzlers and the foreign companies ONLY make small fuel sipping subcompacts does not match the reality. ALL of the manufacturers were building and selling what people at the time were buying (big surprise)and ALL have unsold inventory of these going at bargain basement prices.
(3) The sales figures of the Big Three (B3) over the past few years belie comments on 'vehicles nobody wants', including sales in the sub-compact, compact and mid-size categories as well as the big gas guzzlers.
(4) The average labor cost on a B3 car has gone from 25% to 7% over the past twenty five years. 9 of the top 10 most efficient plants in North America are unionized B3 plants, and the 10th is Nummi, a joint venture between GM & Toyota.
(5) The $70 an hour labor cost quoted by the B3 management in their union bashing includes legacy costs for retirees that should have been funded years ago when times were good. However, the governments of the US and Canada both allowed the companies to under fund their pension and benefit plans so that these costs must now come out of today's operating expenses. If any of the B3 goes bankrupt, the governments may find themselves on the hook to cover these expenses, at least for existing retirees.
(6) In term of actual wage numbers, the unionized B3 workforce is close to being in the same wage ballpark as the non-union workers at the best-paid foreign plants - about $28 an hour. The UAW's new contract also includes a clause that stipulates that new workers will get $14 an hour as the contract is phased in. This means the new workers in the B3 shops are slated to be paid about the same, perhaps a bit less, than new workers at the non-union foreign plants. And existing B3 union workers are being paid about the same as the best paid non-union workers.
(7) The cost of management at the B3 is way, way higher in terms of wages, benefits, bonuses and the sheer numbers of bodies than at any of the major foreign companies.
(8) Lest you think ONLY the B3 is being severely negatively affected by the economic downturn, Honda and Toyota, among others, have recently announced cutbacks, profit warnings, losses, cancelled factory plans, etc. Furthermore, given the highly integrated supply chain, the B3 folding will have significant and wide ranging repercussions on Honda, Toyota et al since many of the parts manufacturers who manufacture for them also manufacture for the B3, and many of those suppliers will fold up shop. Failure of any of the B3 will ripple throughout the industry.
(9) As far as automotive manufacturing being a dying industry, production and sales are up year over year virtually every year. The B3 make up about 25% of the worldwide automotive market and a great share of the North American one. If they were to fold and stop making cars, no one else can fill the void, as they don't have the production capacity. In the interim it means a massive supply shock, which would only serve to push the price of cars up.
(10) Canada let its own domestic car industry die or get bought out many years ago, and now hosts only 'foreign' car manufacturers, which includes the B3, Honda, Toyota and others. This means that most engineering, design, management and the other juicy jobs are done elsewhere, and Canada has become a 'branch plant' economy. Does the United States want to go the same way and let control over another vital industrial sector go to foreign ownership?

You'll note my own biases in the above facts since I didn't have much good to include about Chrysler (if there is any). Just so you don't think I'm a die hard Detroit redneck, I'm on my third Honda in a row, although I'm considering a Ford next time around because the much ballyhooed quality and reliability of Hondas, Toyotas et al is as much an invention of good marketing as it is of reality. Just try getting parts when your Civic Hybrid breaks down.

Posted by Bob Walker at December 22, 2008 6:09 PM

Hi Judith – my understanding is soccer is becoming much more popular in parts of the US. Please don’t believe David Beckham is all that soccer is about. That’s rather like another US myth that the whole of the population of Britain lives in London. David is indeed a good footballer – one of the best we have ever had in England and one of my own all time favourites. But he is well past his best. David is also a great ambassador for soccer and role model for youngsters wanting to learn the game. He dedicates much of his time to helping kids from the most deprived areas of Britain to enjoy soccer at his soccer training schools. He is trying hard to put something back into the game from which he has made his name.

Posted by Trevor Gay at December 22, 2008 6:24 PM

Bob, superb comment.

Re UAW, etc, way back when Henry Ford gave workers an astounding $5 a day wage (as I recall), appalling other owners; the idea was that they should make enough to be able to buy a Model T. Of course Mr Ford later became a union buster whose armed hoodlums were the tipping point, inducing outrage that ended up solidifying and legititmatizing the UAW.

(I must admit to being perpetually amused-stunned-mystified at the reaction by some to the idea of "wildly pro-business Democrat." There are millions and millions of us, including a huge majority of Silicon Valley entrepreneurs and VCs, my neighbors for 30 plus years. In fact, the Valley is so Democrat-leaning that Republicans like John Chambers and Meg Whitman are seen as oddball anomalies. The 2 entities in the U.S. highest ranked in favorableness to high-tech entreprenurial startups are Massachusetts and Greater D.C. [CA is 4th], also rather Democrat leaning. Also, among other things, the highest net worth brackets are significantly Democrat in voting habits.)

Posted by tom peters at December 22, 2008 6:41 PM

Bravi Bob and TP! Thank you.

Trevor - I'm really not that interested. Thanks anyway, I guess.

Posted by Judith Ellis at December 22, 2008 7:23 PM

Bob...

Great to see you lay out your argument in a coherent fashion. You make many good points - most I agree with totally.

On my most recent trip to California's Silicon Valley, I hired a Pontiac and drove it up and down 101,etc and then on into Nevada - I really enjoyed driving it. It is not the "greenest of cars" but if I was living in America I might buy one because it seemed to be a perfectly good car.

But the problem in Detroit "right now" is summed up by one of your closing comments - "I'm on my third Honda in a row....."

To my innocent eyes the challenge for B3 seems to be to simply meet the market. All the signs are that the market is already looking for a new generation of cars that might include features like low carbon emissions (in production and while being driven), recycled building materials, renewable fuel options, less plastic, durability, lower cost maintenance, performance with fuel efficiency, etc. Also finance deals that make sense - perhaps a deal to 'buy and return' after 2,3,4 or 5 years with full maintenance of car included in the overall cost of the car... I noticed that BMW has tended to go that way in California over the past few years.

I guess it comes down to a simple question in the end... Can the B3 make the cars that the American public will want to buy in 2012 (ie after the recession has worked its way through the economy) and beyond?

At my place we have a Japanese four wheel continuous drive (our work horse) and a French (yeah French) sedan... Clearly I do not support either Ford or GM here at home in Australia where our new Labor government keeps announcing tax payer support packages for our local car industry - including Toyota....

Richard.

Posted by Richard Lipscombe at December 22, 2008 8:10 PM

In considering the plight of Detroit and Henry Ford, one would most certainly have to wonder why there isn't an underground rail system in a city as large as Detroit and its surrounding suburbs. From what I gather Henry Ford struck a deal with City officials back in the day that has had both a devastating and positive effect. For those who can afford to buy a car, this supports the car industry. But for a great many people who are unable to do so, this has been a handicap, especially for non-professional workers. The bus systems have gotten better but they are still lacking. Plus, an underground rail system would be much faster. Building such a system would bring jobs. We can most certainly have an underground rail system and an automobile industry. Perhaps we can have a cleaner rail system that relies on biodiesel or another kind of non-petroleum diesel? Likely? Dunno.

A few months back I attended a meeting of mayors and a local bus system that traverses various suburban cities. There has been a major push to have more buses that go straight from the suburbs that do not stop within City limits for time efficiency. But the whole premise seemed archaic when I listened in as an underground rail system would move much faster and include all cities and all people trying to get to their respective jobs. Detroit has been hampered by a great many things, including a rail system. But there are few cities with such great infrastructure. Henry Ford and Edison saw to this. But some ideas of the past must die so that new ones can bring rebirth. Investing in new kinds of infrastructure may be just what Detroit needs.

Posted by Judith Ellis at December 23, 2008 6:58 AM

Perhaps He has put a few higher quality problems in front of Detroit (and all of us) to reveal the character of its leaders. Who will be the men and women that step up and lead? Who wishes to be held accountable? Who wishes to challenge the status quo knowing change has no constituency? Do such people work at the B3? Absolutely! Do they play or coach the Detroit Lions? Hopefully. (Even the Miami Dolphins turned it around in one year, so anything is possible)

TIme to stop reading the headlines, buying into the depression talk and start being Americans again. No more damned victims!

Posted by David Porter at December 23, 2008 9:51 AM

They use private jets in Detroit which proves they have no wings are therefore are not angels. The bells do not ring in Detroit.

Posted by Small Business Marketing at December 23, 2008 11:43 AM

It's not Detroit that God hates, Tom. It's all Michigan! You see, God is a Buckeye.

Having just gone through the car buying experience, I've become convinced that the weakest link in the Broken 3's food chain is the dealer. I understand that state laws prohibit any changes to the dealer agreements, and there is a Federal law that protects the poor dealers from being smacked around by the big mean manufacturers, but after visiting a dealer or two, I feel dirty. In college, we sometimes went to those places where ladies danced in a state of undress, you know what I mean. I'm not proud of that, but it was college days. But afterward, I felt like I needed a shower to wash the existential grime off. I felt the exact same way after I went to a car dealer (Ford and Chev, for the record). Perhaps it's time to revisit those antiquated protectionist laws and change the actual car buying experience. I can pick and build a computer on line and have it delivered in a few days. I should be able to do the same thing with a car.

Posted by Brian Tingley at December 23, 2008 12:10 PM

Bob Walker said: 10) Canada let its own domestic car industry die or get bought out many years ago, and now hosts only 'foreign' car manufacturers, which includes the B3, Honda, Toyota and others. This means that most engineering, design, management and the other juicy jobs are done elsewhere, and Canada has become a 'branch plant' economy. Does the United States want to go the same way and let control over another vital industrial sector go to foreign ownership?

My reply: Canada has always had a "branch plant" mentality. You say that like it's a bad thing, but it's an offshoot of living next door to America. And GM, Chrysler and Ford all manufacture in Canada, with some engineering and design done there. I think President of GM Canada is a pretty good paying gig. Are you suggesting that there be a 4th independent car manufacturer in Canada? A Studebaker, maybe? Canada doesn't have the population to support that.

Canada is America's largest trading partner, largely because of the auto trade. More trade is done between Michigan and Ontario than the US conducts with any other country except China. So I'm not sure what your point is. I'm afraid that in another 4 or 5 months, the money will be gone and we'll have nothing to show for it. By the end of '09, one of the Broken 3 will be toes up.

Posted by Brian Tingley at December 23, 2008 12:22 PM

It looks like the great State of California could be broke in two months. I guess the governor is seeking assistance of some kind. God must hate the Sunshine State to some degree too, eh? "Every good and perfect gift is from above." Any others are of our own making.

David makes a brilliant point, one that should merit some thought and action. The alternative is embracing the victim mentality throughout many states and becoming one big sickening reality show. Wanna watch?

God does indeed help those who help themselves. But He also helps those who can't help themselves in the form of others. We are helpers one to another, a help that requires responsibility in some form, a sharing of the load.

Let's get on with it!

Small Business Marketing – What a foolish statement you have made. We are people here in Detroit and not angels. I suspect by your lackluster non-leadership abilities, evident in your little quip, that your Small Business Marketing shall indeed remain small. But speaking of bells, they may indeed toll for thee.

Brain – God is most certainly not a Buckeye, nor have such descended whence. The Buckeyes—what ragged little gifts.

Posted by Judith Ellis at December 23, 2008 12:59 PM

Poor Brian proves my point above with this statement. But don't judge him to harshly. He can't help it; he's a Buckeye:

"Perhaps it's time to revisit those antiquated protectionist laws and change the actual car buying experience. I can pick and build a computer on line and have it delivered in a few days. I should be able to do the same thing with a car."

Do you suppose the average buyer will be able to pick and choose parts for an automobile that will be safe for the road? What protection laws that protects me from some idiot drives who builds a car himself online?

Posted by Judith Ellis at December 23, 2008 1:13 PM

As awesomely bad as the Lions are, Detroit can still take pride in the Detroit Red Wings (current Stanley Cup champions and 11 time Stanley Cup winners), the Detroit Pistons (3 time NBA champions and regular contenders) and the Detroit Tigers (well, two out of four ain’t bad). At least the Lions have no where to go but up, unless they decide to play a high school team and still get beat.

A couple of tidbits of information I missed from my earlier posting in this forum to show that many of the negative perceptions of Detroit’s Big Three are incorrect:

In the Insurance Institute for Highway Safety "Top Safety Pick" awards list for 2009, Ford had more winners than any other automaker -- 16 in all. Honda was second, with 13 winners. General Motors Corp. and Toyota Motor Corp. tied with eight each. In all, 72 vehicles made the list. Chrysler was the only major automaker that did not receive a single top safety pick.

According to Forbes, the Ford F-150 and the Chevy Silverado were the two top selling vehicles in 2008 (January to November) in North America, despite the high gas prices. Also in the top ten list are the Ford Focus (10), Chevy Impala (8) and the Dodge Ram pickup (9) rubbing shoulders with the Honda Civic (4) and Accord (5), the Toyota Camry (3) and Corolla/Matrix (6), and the Nissan Altima (7). The top twenty, according to the Wall Street Journal, also includes the GMC Sierra, Ford Escape, Chevrolet Malibu, Ford Fusion and Chrysler Town & Country. Ten out of the top twenty best sellers. Who says the B3 make vehicles nobody wants to buy?

Brian, I agree with your assessment that at least one of the B3 may be gone by the end of 2009 or shortly thereafter. Ford may well get by without a bailout, GM will likely get by with some help and some major restructuring (simplify, simplify and then simplify some more), and Chrysler, which has perennially been on and off life support for far too long, will probably sink beneath the waves eventually regardless of any bailout. As for my comment on Canada’s branch plant economy, that is not necessarily a bad thing or a good thing, just the reality based on the size of Canada’s population and their proximity to the US. While GM, Ford and Chrysler do some engineering and design in Canada, the vast majority of this plum work is done in the US. However, if the US lets its own car industry succumb, then many of those top jobs will be located in Japan (Toyota, Honda, etc.), Korea (Hyundai, Kia, DaeWoo), China (the up and coming new kid on the block), Germany (VW, Mercedes, BMW, Audi), etc. The US economy and market is large enough to support its own share of the world car industry and its own share of the high end jobs. And while being the president of GM Canada may be a pretty good paying gig, that may be more a symptom of GM’s overly generous management compensation than the reality of what the gig should pay. How much does the president of Toyota or Honda Canada (or Toyota or Honda USA for that matter) make in comparison?

Tom, I enjoy your occasional story about your trials and tribulations out in rural Vermont. Keep them coming.

Posted by Bob Walker at December 23, 2008 5:06 PM

"simplify, simplify and then simplify some more"

Bob - thank you and Amen. If only we could apply your common sense thinking everywhere in business. Far too many seem to want to create unnecessary complexity when all that the vast majority of us really want is to see simplification. Well said.

Posted by Trevor Gay at December 23, 2008 6:12 PM

I've been driving around in the 2009 Dodge Ram with a friend for about six months now. It's an excellent vehicle; we've been zipping around in over one foot of snow these past days without very little trouble; in fact, we have had no trouble at all. Great truck. Smooth ride.

Posted by Judith Ellis at December 23, 2008 6:24 PM

I have been deliberating over these comments for a few days and will try to keep this short. First, the context...I am the son of an autoworker, not big 3, but a job shop that supplied them. My Dad was active in the UAW, and I remember Walter Reuther. I worked for GM and supervised members of the UAW. I have 20 years of consulting with the Big3 (good lord, I hope that isn't the problem!) and have consulted directly with the UAW. My input on the UAW issue. They indeed have a huge brand problem. Of course there are wonderful members, but it seems the tolerance and outright support of their less than stellar members is what stands out for people. Yes, I have seen the rush to the party store at lunch to grab a quart. I have caught some folks punching in for others. I have had people tell me if we are going to work them 10 hours we have to expect they are going to nap now and then. So to the bargaining chairs, if someone is breaking a negotiated shop rule, it does you no good to continue to insist they shouldn't be reprimanded. Please remember the jobs bank was created to put people to work on charitable efforts not sit in a hall playing cards. And yes, it is hard work, more because of the mental boredom than the physical effort, but it is no more difficult than the folks at your supplier's companies who work for much less. So folks, work with management and use that nickel dime fund to prepare the workforce for the new world of work. Now, for those who take great pleasure in laying the blame for this mess at the feet of the UAW let me share the other side. The improvement in quality would not have happened without the joint efforts with the UAW. I could get real change through far more easily working with union leverage than taking on the GM chain of command. Irv Bluestone, former vp of the UAW, was an absolute champion of quality. Chuck Britnell, a mid level official at the UAW was instrumental in the formation of Chrysler's QIP process and courageously even used union funds to pay for quality training. Walter Reuther said in 1956, "we can continue to fight over a bigger piece of a shrinking pie, or work together to grow the pie". We accept routinely the idea today of retiring after 30 years, please remember, it was the UAW who championed 30 and out. The current leadership of the UAW has a real mess on its hands, but no greater than the mess management has created at many of our companies. I am sure there are many on this blog who have differing opinions...I claim no wisdom..but would ask that you consider the whole before making your judgment. Oh yeah, one last thought, Peter Drucker said "I never met a union management didn't deserve." Looks like it is time to reimagine the whole world of work ... should sound familiar to regular readers. I will be back for a comment on Detroit itself tomorrow.

Posted by Mike Neiss at December 23, 2008 9:19 PM

"I never met a union management didn't deserve."

Mike - Thanks so much for that Mr Drucker quote. To my ultimate shame I had not heard those wonderful words before but they sum up my feelings perfectly. When Unions are bashed on these pages and conveniently 'blamed' for all the ills of business why don’t people look first at the responsibility of management that is way out of touch with workers. My late beloved Dad was an active Union man in the 1960's and Mr Drucker's wisdom is arguably truer today than it was then. When I look at some of the poor management practices we see today I desperately wish we had even more powerful Unions. Nothing changes – this management stuff is so simple - be in touch with your front line workers; value them; listen to them; respect them; and provide broad leadership stakes in the ground; then leave it to them whilst you get out of the way; and hey presto your get great results.

Posted by Trevor Gay at December 24, 2008 5:07 AM

I don't understand how Tom Peters can defend the UAW when the union has violated everything he has ever written. I grew up in Flint, the birthplace to both GM and the UAW. No one in this bailout debate from the UAW has ever mentioned the word "customer." How the hell can Tom Peters defend the UAW while criticizing some minimum wage store clerk for closing the door at precisely 5:00????????? The UAW is now declaring war on southern Republicans. Does anyone from the UAW care about car sales in the south?

Posted by Michigan and Me at December 24, 2008 2:55 PM

Mike, your perspective on Detroit is always enlightening. It's time for THE BOOK.

Posted by John O'Leary at December 24, 2008 4:27 PM

The UAW union legacy costs of 500,000 GM retirees are key - they make too much to compete as B3 with Lexus, Acura, Infiniti, Toyota, Honda, Nissan et al.

$15M per year for Viagra is no joke per UAW agreement @ GM per year. So if UAW does not concede benefits then we citizens keep paying to bail them out or they disappear & then the federal government trims their benefits once & for all.

England now is bailing out Jaguar & Land Rover - which are now owned by India's Tata - how ironic! Unions have greedy front liners like anyplace else that cause failure in collaboration with management. The neoliberal Tom/Judith mantra does not add up unless UAW concedes benefits. I'll stick with my Google/Apple car which for now is called a Lexus/Toyota!

New idea - cars by Google & Apple - the US MUST have Silicon Valley in the fray to thrive! :>)

PS - God is Love but the rest of us hate Kwame in jail as former mayor of Motor Town - such an idiot for text messaging the woman he was cheating with! :>)

Posted by Contraire at December 24, 2008 7:18 PM

Mike, good comments on the union side of this issue. I look forward to your forthcoming comments you about the other side of the fence. No one in this mess is without some blame. Your quote from Peter Drucker is right on. My grandfather was a union organizer and so I heard the union side of things growing up. I was always puzzled about why management would treat their workers as poorly as he depicted, until I grew up and was on the other (management) side of the fence. Between the management perspective and the stories from good friends who had the misfortune to work in dysfunctional unionized organizations, it didn’t take long to figure out the truth that Peter Drucker put into words. Why is it that Honda, Toyota, et al have managed to avoid unions in North America? In their seminal business book “In Search of Excellence”, Tom and Bob compared two GM plant managers, one who exercised an ‘Imperial’ management style and another who knew the worker’s names and regularly wore the baseball cap and jacket the UAW had given him as a joke when he took over the plant. Guess whose plant set GM wide quality and productivity records? (Tom, I hope I got this anecdote correct. I mentioned this from memory since an ex-friend borrowed the book from me years ago and never returned it. Some day I’ll get around to replacing it.).

I find it fascinating that everyone (including me) is so engaged and opinionated over the auto sector bailout when the a**holes in the financial sector worldwide who caused this crisis in the first place have received considerably larger bailouts with no strings attached, and have continued to live large off the taxpayers of most industrialized countries, with little or nothing said. Where is the sense of outrage over that?

It looks like the Detroit Red Wings are in strong contention this season for a run at the Stanley Cup (23 wins vs 6 losses). That should help offset the Lions dismal season this year. It is interesting that even though the Wings logo is a wheel with a wing attached, supposedly representing the Big 3 Detroit car manufacturers, that the only sign of automobile sponsorship on their web page is from a BMW dealer. Is this a sign of things to come?

Posted by Bob Walker at December 24, 2008 10:15 PM

I think God saves his greatest challenges for the ones he loves the most.

Posted by JG at December 25, 2008 10:47 PM

Obama FCC Lead Plays WoW

According to Wagner James Au, Werbach plays WoW and is in two guilds with multiple characters (though one imagines he doesn't exactly have time to raid), while Crawford gets her kicks in the virtual space of Second Life. Their interest goes beyond what the games are worth as software, though - Werbach sees games like WoW as models for future software development:

"What [Warcraft] does," he continued in that post, "is provide an incentive for people to develop new software and ideas for collaborative production. Many of those ideas will translate to other group activities, including those within the business world. I think MMOGs will be, at a minimum, a significant testbed for these new technologies, because users see a direct benefit and are willing to experiment with new things."

Unsurprisingly, this perspective extends to virtual worlds like Second Life, which has been an important component in Werbach's Supernova technology conference. On her own blog, Professor Crawford, a board member at ICANN, also counts herself "a huge fan of Second Life" for the way it lets users retain IP rights to their content (though she confesses to difficulty when it comes to moving her SL avatar around.)

So the next time you're in Azeroth and trying to decide whether or not you should gank that hapless Gnome, you might want to stop and consider the fact that you might be about to waylay the new boss of the FCC. Or maybe he's that Hunter in your party who never dismisses his pet before jumping down off a ledge.

http://www.wowgoldkk.com

Posted by lisa at December 28, 2008 3:09 AM

I think the Lions and the Auto Companies sever a very useful purpose for the rest of the country and maybe the world. Every poor perfroming team may now say "at least we are not as bad as the Lions". Every poor perfroming company can say "we may be screwed up but at least we are not one of the big three". The Lions and Auto Companies have ended up in the same place for the same reasons; bad management, relatively inferior product, and a propensity to whine instead of fixing the problems.

Posted by Jim Outland at December 30, 2008 3:22 PM

Tom,

God doesn't hate anything. The Big 3 are getting what they've earned over the past several decades. Even Barry Sanders knew when to hang it up with the Lions. We are a society that has a very low "hardship tolerance" and we're about to get the test of our lives (if you're not already). I'm not sure if you've seen www.iousathemovie or written about it, but we are in for a very rough ride for the next several decades.

When capitalism was strong in America, it isn't anymore, the consumer made decisions that impacted a company's success. Companies were either rewarded with more profitable sales for good work or went out of business because of their inability to service a consumer.

Enter the government...now we reward bad behaviors, worse management, and could care less about the consumer. I was driving down a major street in the city I live in today and shocked at how many businesses have shut their doors. The amount of square footage available in many of the strip malls is overwhelming. Many businesses were waiting for Christmas to liquidate and close shop at the end of the year. Companies that have been around for 3-4 decades are closing their doors because they can't finance payrolls and inventories. Good companies too!

All of the talk of great management skills, techniques, and strategies, in my opinion, is hogwash. Regardless of your skill level, if the people I work for or report to are dishonest and self-centered, my improved management skills don't make a dent. The reality is that my skills and abilities have little to do with what I can accomplish in management; the actuality is that if I'm not kissing ass or supporting incompetent ideas, I'm going to be on the outside looking in.

People get really focused on fixing problems in these blogs. Please tell me, with 8.2 trillion in debt, huge loans we've taken from other foreign countries, and an enormous amount of committed dollars to social security, medicaid, medicare, and other non-negotiables for the next several years, HOW DO WE FIX THAT?

How about a little honesty, on everyone's part, to start.

www.droppingalmonds.com

Posted by Candy Man at January 14, 2009 9:21 PM

"All of the talk of great management skills, techniques, and strategies, in my opinion, is hogwash. Regardless of your skill level, if the people I work for or report to are dishonest and self-centered, my improved management skills don't make a dent. The reality is that my skills and abilities have little to do with what I can accomplish in management; the actuality is that if I'm not kissing ass or supporting incompetent ideas, I'm going to be on the outside looking in."

That is brilliant Candy Man thank you. I agree with you that what we are about to or already are experiencing is a wake up call that was predictable. I am intrigued how the world of business that has grown accountants like cress grows overnight ends up so deep in the mire. There is irony there surely. But I'm not blaming accountants - we are all equally to blame.

“God does not hate anything” - amen to that also. God is used too often as a convenient and easy cop-out for our human failings but He can never be the scapegoat for the actions of people who are given free choice.

Thanks for such a realistic view of business.

Posted by Trevor Gay at January 15, 2009 3:46 AM