64 year-old Daniel Akerson has worn many hats during his career. An electrical engineer and financier by education, retired Naval office, and executive trade, Akerson is coming up on his third year of serving as the automaker’s chief executive. He believes that it is during his days in the telecom, technology, and private investment sectors that he learned the management lessons he is applying at GM today. The most important:
“Fundamentally, no kidding, it’s all about leadership. I don’t think you have to be a subject-matter expert,” Akerson told USA TODAY in an interview. “Complex organizations have many common challenges.”
Under Akerson’s watch, General Motors — which underwent a government-funded Chapter 11 bankruptcy in 2009 — has flourished. But whether GM’s success, notably consisting of climbing sales and record profits, is Akerson’s doing, or a combination of a recovering economy and a plethora of desirable automobiles that were approved, designed, and engineered before he took office, but launched during his tenure, is a different question.
Akerson joined GM’s board of directors in 2009 as the automaker was gong through bankruptcy restructuring. During his time on the board, Akerson witnessed the arrival and departure of two CEOs: ex-ATT chief Ed Whitacre, who resigned from the post to retire, and Fritz Henderson, who served as the “Old GM’s” CFO until being ousted by Whitacre.
Upon assuming the CEO position in September 2010, many industry watchers and analysts were concerned by his background. “Not a car guy”, they said, while wondering about Akerson’s ability to lead a global automaker that was in need of major change in culture, operations, and corporate structure, among other areas. Fortunately, leadership skills can usually be applied across industries.
“So, here we are four years out of bankruptcy and we’ve made $25 billion (before taxes and interest). I think that’s more than the company’s ever made in a four-year period,” Mr. Akerson said.
Industry watchers and car enthusiasts know that it takes three to four years to fully develop a vehicle, meaning that the vehicles that launched under Akerson’s leadership were not approved or developed under his watch. In fact, it will only in the next year or so that the fruits of Akerson’s labor will begin to show in GM’s product portfolio. But for the time being, the executive has had three years to apply his leadership and management expertise, and has done very well overall.
|Growing global sales
|Lower-than-expected Chevrolet Malibu sales
|Modest sales of Chevrolet Volt
|Curbing losses & resolving major issues at GM Europe
|Lack of general strategy between Opel and Chevrolet in Europe"
|Fortifying balance sheet
But even with the few-and-far-between mishaps, Akerson’s GM is dynamically addressing problem areas. The new 2013 Malibu, which wasn’t developed under Akerson’s directorship, hasn’t sold as well as some expected it to, is receiving a refresh a year after its launch (for the 2014 Malibu); the Volt has consistently received performance improvements and price drops, with the 2014 model year Volt getting a $5,000 reduction in its price tag. In addition, The General recently outlined a new strategy surrounding the mainstream Opel and Chevrolet brands in Europe, which have overlapped in the region for years, thereby competing with each other. The strategy isn’t as clear-cut as some would have liked to see, but it’s a start. All in all, it’s true that Akerson has inherited many problems created by the Old GM, doing his best to solve quickly and as effectively as possible.
And those who watch GM closely have likely noticed a change in GM’s culture, which now focuses on quickly solving. Even more important, long-term issues such as the unprofitability of The General’s European division, over-complexity, and towering pension obligations — are being addressed with zealous determination. And that’s not to mention a successful Initial Public Offering of thew New GM in 2010 — making it the largest initial public offering in U.S. history.
For his part, Akerson strongly believes in management by “walking around”. In fact, there are photos of the chief executive visiting the automaker’s various departments around the world and speaking to employees. Some, however, aren’t convinced that Akerson is responsible for GM’s recent successes.
“Put me in the category of being doubtful. He’s blessed with a burgeoning market and he’s blessed by having a line of products designed, primarily, long before he arrived,” says Gerald Meyers, crisis-management consultant, and professor at the University of Michigan.
“You have to give him credit for the accomplishment. But now comes the hard part,” says Meyers, who was the chief executive of American Motors from 1977 to 1982, when it partnered financially with France’s Renault to stay alive.
Ultimately, few can deny the positive ways in which Mr. Akerson has affected The General. But it will be the next several years, as vehicles developed under his watch come to market, and GM records profits against those new products, that will paint a clearer picture of his tenure.