During the GM Q1 2019 earnings call in April, GM CEO Mary Barra received some interesting questions from Brian Arthur Johnson, an analyst at Barclays Capital. Johnson’s first question surrounded product desirability, GM vehicle design and the effectiveness of its marketing efforts. After Barra’s response, Johnson followed up with another question about GM’s ability to remain creative as an organization.
“Let’s get back to the design process. You talked about discipline and focus groups, but how do you create enough room for off the wall creativity, the classic Apple scenario, where people don’t know they want it until they see it?”
GM CEO Mary Barra’s response shed some light on how much flexibility is given to GM employees.
“I think this applies more on the technology side. Super Cruise is exactly that, the fruit of our team being creative. That’s the feedback we’re getting from customers. But we also let creativity forge our designs.
One of the things we do at GM is every time there’s advanced design, almost any designer in the company can participate in putting ideas forward. We allow every designer in the company to provide input.
The GMC Sierra MultiPro tailgate was a great example of this. It came through creativity and innovation from our workforce and manufacturing shops. This allows an innovation process where everybody can participate.
We have what I like to call a shark tank where we’ve organized competitions where people all over the company bring in creative ideas. Of course, our chief engineers and designers are there to approve the ideas.”
The GM Authority Take
We agree with Barra concerning GM’s creativity for technology and engineering. We’ve seen great new features such as the aforementioned MultiPro tailgate on the 2019 GMC Sierra, the Rear Camera Mirror, or the clever technologies integrated into the MyLink, IntelliLink and CUE infotainment systems, such as Teen Driver, Valet Mode, as well the new trailering camera systems found on the 2020 Sierra HD and 2020 Silverado HD. We’d even add that the Chevrolet Volt and Chevrolet Bolt EV are engineering marvels that remain competitive even years after their release.
But from where we’re sitting, GM’s ability to let its hair loose to develop game-changing new products is still lacking. We can only imagine the massive bureaucracy of management these ideas had to go through before seeing production.
The situation is further exacerbated when considering that GM has shown significant levels of inability or disinterest in finding and capitalizing on niche segments. By comparison, rivals such as the Kia and Hyundai have carved out niches with vehicles likes the Soul and Veloster, respectively. Meanwhile, German automakers such as Mercedes-Benz, Audi, and BMW, have found ways to create niche segments with “four-door coupe” versions of their sedans and crossover SUVs, creating desirable, value-packed, and – most importantly – profitable products. GM is absent from those spaces.
At the end of the day, GM most certainly has capable and creative designers and engineers, and the automaker’s processes have allowed it to bring fresh new ideas to market, as Barra explained. But the issue at hand is that GM remains a top-heavy company that seems to stifle creativity, resulting in lost opportunities and – ultimately – a competitive disadvantage.