"GM" means "Global Motors"

A single word keeps cropping up in conversations with top General Motors executives.
 
The word is “global.”
 
In spending most of yesterday in internet “chat” sessions with General Motors executives as part of GM’s Virtual Media presentation - including Troy Clarke, president of GM North America, Micky Bly, head of GM’s hybrid development program, Ken Parkinson, the vice-president of design for GM Asia Pacific, David Tulauskas, GM Asia’s director of public policy, Anthony Stolfo, Holden’s and GM’s director of global RWD architecture, David Chen, manager of GM’s operations in Beijing, and Kevin Wale, the managing director of GM China – over and over, GM executives in all of its various locales come back to that word to describe the company’s strategy, assets, and reach.
 
The popular conception of GM’s corporate culture as a monolithic Queen Mary that cannot be forced to deviate from its course, no matter how imminent the disaster, is a serious misconception. Also obsolete is the image of GM as something like the clumsy kid who always drops the ball. 
 
GM, at least, sees itself very differently.
 
In all of this, it appears that Rick Wagoner is casting a very long and lasting shadow. The concept of globalization which his company is executing is very clearly his idea, his policy, and his goal. It is the equivalent of creating a corporate phoenix, a new and great creature reborn from its own ashes.
 
Addressing the North American market, Troy Clarke spoke of the need for GM to be “agile” in developing new products. In Shanghai, Ken Parkinson explained that in each of the four Asian design studios, GM has team members from all over the world, not just China or Korea. The Shanghai studio that developed the Buick Riviera concept car comprises members from China, Europe, the United States and other countries. The same is true for the Seoul studio and the others.
 
There is reason for this eclectic mix of cultures. It’s not unique to GM’s Asian operations, either. It is part of the plan throughout the company, in every locality, and function. The design studio in Shanghai can develop a product for any GM market, because it has people in it from every market and can, thereby, bring the unique knowledge of taste and culture in each to bear on the design of new cars. 
 
That is merely one example of the way GM develops the “agility” of which Mr. Clarke spoke. The core concept runs much deeper than just making cars in one market that can be sold in another, much deeper than making Holden Commodores into Pontiac G8’s.

It is, in a very real sense, a reinvention of the company.
 
General Motors historically was organized according to the structure laid down by Alfred Sloan – the structure of independent divisions, each feeding into the next up the ladder, as the buyer progressed through the ranks of GM cars from Chevrolet to Cadillac. The beauty of Sloan’s structure was its decentralization: decisions were made as close to the customer as possible, and division managers had almost complete autonomy. In the 1960’s, GM began to move away from that structure, eventually centralizing almost all decision-making. The result was a structure that avoided risk, one that made decisions reactively, and ultimately one that lost touch with the company’s markets.
 
The General Motors of today seems dedicated to eliminating that centralization and returning to a decentralized model, although one very different than Sloan’s. General Motors’ current culture of “globalization” seems designed to create generalists throughout the company, albeit specialized generalists. 
 
That means that the expertise at Holden in RWD architecture also includes the expertise necessary to understand and design for the Chinese market. It means that the Shanghai studio that designed the Riviera can design a car with a solid understanding of the culture and needs of Western Europe. It means that, should the United States market demand small city cars at low prices, the Chinese expertise that has already resulted in the production of minicars for that country’s emerging markets can be applied with an already developed appreciation of the U.S. market’s needs.
 
Clarke’s concept of corporate “agility” depends on that new form of decentralized corporate structure, and it is obvious that GM is betting heavily on that new structure. It is still a work-in-progress, the fruits of which are far from fully visible. 
But it is abundantly clear that it is a vision that has permeated GM’s corporate culture and to which its executives fully subscribe. 
 
It is also evident that GM is betting heavily on being able to conquer the marketplace with technology. It is very clear that GM’s ultimate goal is, as Mr. Chen put it, to “take the automobile out of [the environmental] equation” through new technology. The company’s strategy makes this a key to its future in developing markets and mature markets alike.
 
General Motors is betting that its global strategy is a winning strategy. Some auto industry observers believe that, ultimately, the industry will distill down to General Motors and Toyota, with a few also-rans in Europe.
 
They might just be right.<