GM CEO has strong background in Operations and Supply Chain Management

Discussion Questions

  1. From the article, what can you learn about Mary Barra’s background as it relates to Operations and Supply Chain Management (OSCM?
  2. How does an understanding in OSCM help the CEO of GM?
  3. Are there other major companies that have CEOs similar OSCM understanding?


Speeding up GM’s comeback

No matter how much attention she draws as the auto industry’s first female chief executive, Mary T. Barra is determined to keep the focus on cars and trucks at General Motors.

In her first extended public comments since taking over the top job at G.M. on Jan. 15, Ms. Barra on Thursday vowed to accelerate its comeback from bankruptcy with improved products, better brands and consistently profitable operations around the world.

Andrew Harrer | Bloomberg via Getty Images

It is a tall order for a company that has only recently stabilized since its government bailout five years ago. But Ms. Barra is already putting her stamp on the nation’s largest auto company.

In a two-day meeting this week with G.M. executives from around the world, the 52-year-old Ms. Barra crystallized the mission ahead of them.

“I told the team that there is no destination here, that this is a continuous improvement journey,” she said in an interview. “Don’t confuse progress with winning.”

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A trained engineer and former plant manager, Ms. Barra, who speaks in measured tones, brings a shop-floor attitude to the executive suite of a company that has historically drawn its leaders from the world of finance.

And while she gracefully handled the crush of camera crews capturing her every move at the recent Detroit auto show, Ms. Barra has gone to great lengths to keep the focus on G.M.’s competitive position rather than her new found celebrity.

“Even when you’re leading in a segment, that’s only for the moment,” she said. “It’s a very competitive business and others are looking to surpass you, so you have to continually keep raising the bar for yourself.”

The automotive world has watched intently as G.M. — known for so long as the most staid and conservative of the American car makers — has basked in the aura of Ms. Barra’s ascension.

But the sudden focus on Ms. Barra has raised questions about whether a tried-and-true G.M. employee of 33 years can, in fact, drive the company to new heights.

“I think people are generally in a state of uncertainty,” said David E. Cole, former chairman of the Center for Automotive Research. “Mary knows the company and has a lot of history with the people, but she is facing enormous expectations.”

Her low-key, inclusive style is a far cry from the personality of her predecessor, Daniel F. Akerson, who was appointed to the G.M. board by the government and spent much of his four years as chief executive cajoling the company to shed its hidebound culture.

In contrast, Ms. Barra exudes the optimism of a chief executive blessed with a strong balance sheet, solid positions in critical markets like North America and China, and an employee base energized by the federal government’s sale last year of the last of its G.M. stock.

“If you went back five to 10 years, the team just didn’t have the ability to do great products,” she said. “Now we have enabled them and given them the framework to make great cars and trucks.”

As the head of global product development before becoming chief executive, Ms.Barra played an integral role in introducing small, fuel-efficient cars like the Chevrolet Sonic and Spark, as well as new versions of its stalwart pickup trucks and sport utility vehicles.

Yet G.M. has struggled to gain any appreciable share in the hard-fought American market, remaining at about 18 percent. The company’s sales in the United States increased last year by 7.3 percent, which trailed slightly the industry’s overall growth of 7.6 percent.

And the international picture is still muddied by continued losses in its European division and stagnant profits in Asia.

Ms.Barra is hardly shifting the strategy advocated by Mr. Akerson, which included a greater emphasis on building the Cadillac luxury brand and using G.M.’s global scale to produce products that can be sold successfully in every region of the world.

“There is no right turn or left turn we’re going to be making,” she said at around-table meeting with reporters on Thursday. “We want to accelerate.”

During the round table, Ms. Barra never wavered as she gently deflected repeated questions about the significance of her role as the first woman to run a car company.

She listened intently each time the topic was brought up, but calmly but firmly cast aside any suggestion that her appointment was historic for the male-dominated industry.

“There has been a lot of coverage,” she said. “But my gender doesn’t really factor into my thinking as I come into a room.”

She did pledge to be a visible, approachable presence throughout the company —again a contrast to the imperial leaders G.M. has had in the past — holding regular town-hall meetings, smaller get-acquainted sessions and web chats with employees. This weekend, Ms. Barra will travel to Europe for the first of several planned visits to G.M.’s regional operations.

Mr.Cole, whose father was president of G.M. in the 1960s, said employees at the company seemed keenly optimistic to have someone at the helm whom many of them have known personally for years.

(Read more: Automakers miss the mark but 2013 flirts with pre-recessionpeaks)

“It’s going to be an altogether different situation than with Akerson, who was more of a brusque, top-down kind of manager,” he said. “Mary just has a far deeper understanding of the company and its strengths and weaknesses.”

Ms.Barra is publicly reinforcing two of G.M.’s most ambitious goals — achieving 10 percent pretax profit margins in North America by mid decade, and steering the troubled European unit to a break-even performance in the time period.

To achieve those targets, she will need to step up the cadence of new products. At the Detroit show, G.M. showed off two vehicles, the new GMC Canyon midsize pickup and the Cadillac ATScoupe, that it hopes will generate steady sales gains.

Industry analysts are, for the most part, confident that G.M. has turned a corner in its effort to improve quality in its vehicles and add sizzle with striking designs and the latest technology.

“G.M. cars just look better than they have in a long, long time,” said Joseph Phillippi, an executive with the marketing firm Auto Trends. “Something like the ATS coupe is an attractive alternative to even the best of the German luxury models.”

Ms.Barra’s star turn at the Detroit auto show underscored the amount of good will she has already engendered for G.M.

A high point was her tour of the Chevrolet brand exhibit with Vice President Joseph R. Biden Jr., who could not stop admiring the sleek new, yellow Corvette on the stand.

But she could not help but reflect on Thursday about the same auto show five years ago, when G.M. employees collectively held their breath, hoping that the Obama administration would bail out the company with federal funds.

“I’m a person who looks at the glass as half-full,” she said. “I also believe if you have a problem you better solve it. Because if you don’t solve it, you won’t be here or the company won’t be here.”

This entry was posted in Cost, Human Resources, Jobs, Supply Chain Strategy. Bookmark the permalink.

1 Response to GM CEO has strong background in Operations and Supply Chain Management

  1. John Abraham says:

    Great article. Supply chain always require effective people in order for companies to penetrate new regional markets, optimize their supply chain delivery models, and demonstrate total supply chain costs lower than the competition. Global4PL helps businesses in designing and delivering holistic, end-to-end supply chain solutions including differentiated supply chain delivery models.

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