Coming up on his three-year anniversary as the CEO of General Motors, Daniel Akerson recently shared several executive-level lessons following his appointment to the position. So, grab your favorite drink, sit back, and enjoy these eight useful pieces of advice:
1. Make goals clear
Having rid itself of costs associated with unnecessary or outmoded brands, legacy debt, and nonessential workers during the Chapter 11 reorganization, General Motors was able to start with (more or less) a clean and rather healthy balance sheet. But “you can’t live on a crisis mode”, says Akerson, and must normalize the company’s operations.
In accomplishing this, a CEO must “articulate that vision” and communicate a strategy of “what you want to accomplish”. Akerson didn’t hold back in restructuring GM’s executive ranks, raising more than a few eyebrows of industry observers and even GM employees in the process. Overall, the changes created a more focused leadership at the automaker, setting The General on a path to further success.
2. Maintain that “good enough” is anything but
Here’s a thought-provoking anecdote from Akerson that’s sure to earn cheers and applause from GM enthusiasts: “I was told one time when I asked about quality: ‘It’s as good as anyone else’s.’ Well, when I was in school and if I’d have come home and told my dad, that I did as well as everybody else — a ‘C’ didn’t cut it. What are we doing to improve?”
The comments ring home as GM attempts to win back customers who, over the years, have defected to other brands. And in that regard, The General can only do so with products that aren’t good enough, but are genuinely better than those offered by the competition.
Akerson once walked out of a meeting for the Cadillac brand because what he considered to be a contemporary vehicle telecommunications/connectivity (infotainment) system was being discussed for use several years down the road, rather than immediately.
What’s more, when engineers and product planners tell Akerson some feature that he thinks is necessary is probably too expensive, his likely reply will be: “Figure it out. No more excuses.”
3. Question the status quo
This is a big one, as the practices of “Old GM” were part of what brought the automaker to Chapter 11 bankruptcy.
Past practices “can be flawed,” regardless of how tightly held they are within a company. “You have to be able to define reality,” Akerson says.
This meant canceling some of the programs die-hards thought defined GM, including investing in new powertrain programs even though they might be too expensive, not work in a variety of vehicles, or not adequately differ from those already in production.
4. Be quick to capitalize on good ideas
Having spent the lion’s share of his career in the telecommunications business, Akerson recognizes that smaller and more nimble firms, not established giants such as AT&T or Verizon, that turn fresh technology into a profitable business.
“We are the most prolific patenter in the automotive industry, but we weren’t converting that to commercial” use, said Akerson. He once asked for examples of “three or four things that are in the cars today that we invented in the last 10 years. There weren’t any.”
5. Back-end operations, accounting, and IT are boring, but important
The back room, information technology, and accounting methods might not be the most exciting aspects of a business, but they serve as the foundation of how modern companies operate.
“Reform some of (the) systemic issues that cause problems,” says Akerson.
Under his watch, General Motors has embarked on a colossal IT transformation that will result in bringing most of the operations in-house to better innovate and support the business from within, rather than outsourcing to third-party vendors who don’t always deliver an integrate, elegant, or well-founded solution.
6. If it’s not working, quit doing it
“We’re not going to sustain operations in the business that continually lose”, he says.
7. Don’t let up
“You have to be a patient and constructive critic.”
8. Don’t get distracted from the main reason you’re there
“Fundamentally, I’ve got to run a business that’s going to turn profits”, said Akerson.
The GM Authority Take
Dan Akerson joined GM’s board of directors in 2009 as the automaker was undergoing the infamous politically-stirring bankruptcy, and became CEO on September 1, 2010, succeeding Ed Whitacre. Although some would argue that GM’s current achievements aren’t entirely of Mr. Akerson’s doing, the reality is that the automaker had a successful IPO, its sales are up, profits are healthy (and are poised for significant growth), and all kinds of problems are being solved left and right through a transformed business culture with increased accountability. And to us, Mr. Akerson’s leadership and management lessons are inspiring, motivating, and thought-provoking, to say the least.
Of course, there are a few discrepancies, such as with the “If it’s not working, quit doing it” perspective as it relates to GM’s European operations, but that might be in the interest of long-term gains via several short-term losses, rather than one short-term gain for a continuity of long-term losses.
The way things are going now, it seems that GM is well on its way to once again becoming the Alpha of the auto industry.
This piece from USA Today inspired this article.