Yesterday, Marry Barra vowed to make things right at General Motors.
The CEO at GM spoke on the company's reaction to the Valukas Report regarding the ignition switch failures on North American Delta platform compacts, the Pontiac Solstice and the Saturn SKY roadsters. Barra's response was to state the facts, while affirming what needs to be done at GM going forward.
The 325-page Valukas Report provided GM eight recommendations for resolution towards ensuring that product safety is utmost in the minds of the company. Barra affirmed they will act upon each one of these recommendations. The report did affirm there was no conspiracy or cover up of the problem, but rather a lack of responsibility and utter incompetence regarding the issue and its fixes.
As a result, fifteen GM employees have been terminated. Five more had been given serious reprimands in their HR file. Families affected by losses due to the ignition issue will be duly compensated. Barra stated they have already acted upon these recommendations towards internal changes regarding the management of the safety of their products and will continue to do so.
Barra also made two other things very clear at GM. One, the company must center every effort on the customer at every turn. GM has to produce products that have the customer in mind always – including making sure every component is safe to use every time. Secondly, the company must internally take responsibility and accountability for every action that would affect the customer. If you think something will fail and is unsafe – GM's upper management needs to know about it.
The Valukas Report was very thorough, according to Barra. U.S. Attorney Anton Valukas and his team at Jenner & Block received full access by the company to documents for review and individuals for interviews. The conclusions made by this report were sobering to Barra and the company as a whole. It was as a mirror was shown to everyone at Renaissance Center – and the reflection was not pretty.
This was a reflection of eleven years of a problem that persisted without proper responsibility and accountability within GM. Whoever did not take action on correcting the problem sooner shouldered a weight beyond just millions of ignition switches. These people who were seen as responsible for not correcting the problem feigned the responsibility and accountability of an issue that resulted in the loss of life and the stirring of emotions beyond borders and political ideologies.
As CEO, Barra took a deep look at her company – the only one she has been an employee of throughout her working life – and concluded it needed a paradigm change. The paradigm change is to focus on its customers by, in her words, "set a new industry standard for safety, quality, and excellence." Yes…and they should. Is this not what business is all about – ensuring that they deliver products that are of the highest level of execution to the customer? As Barra stated, this goes beyond "cleaning up this problem and making a few process changes."
Does this mean looking back at those who ran the company at 2003, or were in key positions involving the engineering, supplier relations, assembly and marketing of the products in which this ignition switch was installed? The Report has done that for us. We do not have to form a Greek Chorus to do what the National Highway Traffic and Safety Administration, Anton Valukas and their respective teams have already spent their time and efforts on. We do not need to know which 15 former GM employees, along with the five that were reprimanded, were responsible for this. This is the company's business to tend to.
It is easy to shake a finger and scream on the Internet chastising GM for doing the wrong thing instead of the right one. Instead of taking the negative road, encourage GM to stick to what their current CEO says. If there is a new problem that would cause safety issues years down the line, let upper management know. Do not sweep anything under the rug – be transparent within the company and, if necessary, outside of it. Take responsibility for anything that would cause harm – physical, fiscal, corporate and so forth.
I have faith in Barra and her team at Ren Center. This is for the sake of the people I interact with at GM. If Barra said that the company will remember this episode and take it to heart in their daily work, I have to believe that is the way GM needs to move forward.
That alone is considered good business.