Martian's Daughter: A Memoir (40 page)

The Leadership Now trainer assigned to work with GM couldn't have been more different from Stewart. Mark Sarkady was a casually dressed, boyish-looking man with an unruly mop of black hair whose excitable manner undoubtedly stemmed from his Hungarian background. Executives who went through his training program, reported one observer, “seemed to have undergone—for the short term, anyway—some sort of religious conversion.”
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Despite their sharply different styles, both men had the same goal—to bring about change at GM dramatic enough to ensure its long-term viability—and neither underestimated the difficulty of the task.

The Traverse City conference was shaped by a combination of the Group of 18's work and the Leadership Now training program. We, the group executives, took the lead in laying out the company's most urgent priorities. I had been arguing for some time that this list should embody a broader vision for GM, extending beyond the vehicles themselves to being a leader as a “total transportation organization,” reviving the slogan that GM had showcased but never implemented twenty years earlier at Transpo ′72. Saturn was already demonstrating the attractions of its unique no-haggle purchasing experience, and anecdotes abounded about why the quality and convenience of post-purchase relationships with the dealer were important to decisions about what car to buy. I also tried to arouse enthusiasm for experimenting with a fleet of city cars that could
be rented by the hour and picked up and dropped off at convenient locations around town—another idea that had surfaced at Transpo ′72. But I couldn't drum up support, and “great cars and trucks” remained the embodiment of GM's vision of how to attract and hold customers.

The traditional speeches from top management to a passive audience of executives sitting in straight rows of chairs were replaced with an interactive workshop format in which everybody present was involved in sharing ideas. At the end of the conference, Roger Smith wound things up by proclaiming, “A corporation, like any living thing, must change if it is to survive. You see, we—that's you and I—have the vision to point the way for change. And we—that's you and I—have the courage to change.”
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At that moment Smith, wearing a casual brown sweater rather than his usual suit and tie, appeared more human than he ever had before, and many of those who heard him dared to hope that we were experiencing the birth of a fundamental change in GM's culture.

My own reaction combined hope with caution: “We are all very conscious of the fact that we raised expectations at Traverse City. There was an immediate afterglow and there will be an immediate letdown, because the world is not going to change overnight. But even the letdown will leave us at a higher level than we were before.”
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But Roger Smith's conversion couldn't conquer his domineering style, and the dramatic changes the Group of 18 had hoped to initiate didn't happen. Once again, the GM culture of inertia prevailed over efforts to dislodge it.

When Roger Smith retired as CEO in mid-1990, the world both inside and outside GM breathed a collective sigh of relief. Both GM's reputation and its financial condition were at an all-time low, and Roger was seen as the man responsible. The board's choice as Roger's successor, Robert Stempel, offered many reasons for optimism. An automotive engineer who had risen through the ranks to become GM's president, he had a string of successes under his belt and was widely regarded as a shining example of engineering talent. Stempel broke the long-standing tradition of a finance man as CEO; now the guys who designed and built cars and trucks had one of their own at the top. A huge man with a booming voice, a firm handshake, and an inclusive manner as he took copious notes on what other people said in meetings and conversations, he would have won any companywide popularity contest for the top position.

The man Stempel designated as president, Lloyd Reuss, was another matter. He was also an engineer, but there the resemblance ended. A small, taut, wiry man with an aggressive manner and zero tolerance for bad news or dissenting opinions, Reuss had as many failures behind him in his GM career as Stempel had successes, but he had somehow managed to leave them behind as he was promoted to the next level. The board neither understood nor was comfortable with Stempel's choice, but it acquiesced to his stubborn insistence that Reuss was the man he wanted as president.

Stempel's timing couldn't have been worse. He became GM's chairman and CEO on August 1, 1990; on August 2, Iraq invaded Kuwait, creating a climate of uncertainty devastating to car and truck sales. Furthermore, Roger Smith had used creative (though legal) accounting methods to push the bow wave of disaster ahead of him, to ensure that it crashed over the head of his successor rather than his own. The result was that Stempel, a smart, decent man who might have become a successful chief executive in more “normal” times, was overwhelmed. His horror of confrontation and his belief in incremental rather than radical change rendered him unequal to a situation that cried out for both. By early 1992, GM was on the edge of bankruptcy.

Despite the fact that he had been welcomed as a breath of fresh air, Stempel carried with him into the job some of GM's most counterproductive behaviors. In 1990, he maintained the company's aversion to a UAW strike—and the resulting drop in sales and market share—by agreeing to the most generous labor contract ever, just at the time when a reduction in labor costs was key to GM's ability to compete. Beneath Stempel's hail-fellow-well-met exterior lay the institutional arrogance and imperious style characteristic of the company's senior executives. This was brought home to me when both he and I were flying to Europe for a meeting of the European Advisory Council. He was using one of the company planes, configured to seat ten to a dozen people, so I naturally assumed that I would fly with him. Not so; he insisted that I take a commercial flight, business class, presumably so that he and his wife, Pat, would have privacy on the overnight flight.

Lloyd Reuss's executive style exacerbated Stempel's difficulties. As the
company's top operating officer, he made some major strategic mistakes. He insisted on the importance of keeping the plants working at capacity even though, under current competitive conditions, it meant building vehicles he knew we would have to sell at prices below the additional cost of making them. He also resisted investment to make GM a leader in fuel efficiency and safety features like air bags because he felt they weren't high on customers' priority lists. His first decision violated one of the most basic tenets of my economist's soul, while his second made me despair of GM ever recapturing its reputation as a forward-looking leader in its industry. But there was no arguing with him on these issues.

Meanwhile, the Group of 18 and many of the midlevel managers were plugging away at streamlining GM and reshaping its traditional culture. That group also took to heart the “black book” compiled by General Counsel Harry Pearce on the basis of more than thirty interviews with GM's top executives (other than the chairman and president) and intended as a set of recommendations for the new chief executive. Because the interviewees were assured of confidentiality, their evaluations of the existing GM organization were devastatingly candid and their proposals for reform sweepingly comprehensive. We were about to present the book to Bob Stempel, with our strong endorsement, when the executive in charge of the Buick-Oldsmobile-Cadillac Group invoked the authority of President Reuss to quash it—yet another example of the old boys' network's protectiveness and resistance to radical change.

After Howard Kehrl retired, Alan Smith became my boss again, and I saw as my major task working with him to implement the initiatives the Group of 18 had championed. Alan was also busy reshaping himself, from a hard-eyed finance man into the guru of the people he had championed at Traverse City. Some of the people who worked with Alan felt that he had indeed undergone a conversion, from a top-down management style to a more collegial and inclusive one. Although I now found his office door open to me once again, I wasn't persuaded.

When Jack McNulty retired as vice president of Public Relations, I began a search both inside and outside the company for a successor who engendered trust, could improve GM's communications, and would contribute to burnishing its tarnished reputation. This was a critical appointment
at a time when the public perception of an uncaring, arrogant automaker needed desperately to be replaced with the image—and the reality—of a friendly, open, responsible one.
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With the help of a search firm, I compiled a list, interviewed candidates, and made a recommendation to Alan. But when his response came back, the name on it had not appeared on anyone's list. The chosen successor was Jim Fitzpatrick, a GM lifer who started out in Finance and was a member of long standing in Alan's old boys' network. I was infuriated by this total rejection of an orderly selection process in favor of blatant favoritism, and Jim and I started out on the wrong foot. Our tense relationship eventually burst out into open warfare, with Jim trying to exclude me from meetings he had called and me complaining about his behavior to Alan. Such goings-on were unheard of in a world where hostilities and backbiting were never allowed to break the surface of correct behavior, and both of us found our credibility undermined.

One of the follow-ups to the Leadership Now process had been an evaluation, or feedback report, from each participant's peers and subordinates. Everyone was judged on five criteria: vision, urgency, empowerment, trust, and responsibility. I had found myself from time to time questioning my effectiveness as a general executive, but I was unprepared for the devastating evaluations I received from the four vice presidents who reported to me and the five peers (other group executives) who turned in responses. With one exception—my subordinates scored me high on trust—I scored below the median of the GM executives who had gone through the Leadership Now program and, in some cases, far down in the percentile rankings.

After I recovered from the initial shock, I started to look for reasons why my peers and subordinates rated me so low in leadership qualities, despite my efforts to get people to work together. The most comfortable explanation, of course, would have been to attribute their responses to sexism, their refusal to recognize that a woman could perform well as a high-level executive. Certainly, the GM executive ranks still were basically a male preserve. My male colleagues didn't engage in overt harassment or put-downs, but it was quite clear that they saw me as a sort of “third sex,” regarding me in an entirely different light than their wives and female social acquaintances. It was only when their daughters with
MBAs started to bring home tales of their own difficulties in the workplace that they began to understand what it meant to be both a woman and an executive in a male-dominated environment.

The most outrageous example of sexist behavior I learned of at GM surfaced when I enlisted the advice of the company's chief of security on how to deal with the persistent attentions of a man—a highly regarded mathematician and professor I had met briefly when I was in college twenty-five years before—who had been stalking me for several years, in person or by telephone when he had the chance, but most persistently through a constant stream of unanswered letters. The message was unvarying; he proclaimed his passionate love for me and insisted that we should abandon our families and run off together. I was unnerved, and my daughter was downright terrified.

The security chief I asked to come up to my office to give me his view of the situation looked as if he had been sent from central casting. A former FBI operative, he was tall and stolid, with a craggy face that could have been carved out of granite. When I told him my predicament, he asked to see some of the offending letters. I produced them with some embarrassment, commenting that he had probably never dealt with quite such a situation before. Suddenly, a smile appeared on his stern visage. “Well, Dr. Whitman,” he drawled, “I've never dealt with an executive who received such letters. But I've had to handle executives who sent them.”

The more I reviewed my own behavior, though, the more I realized that, even though the GM executive ranks still harbored conscious or unconscious sexism, a lot of the responsibility for my low evaluations rested with me. For one thing, I was a control freak, micromanaging people, looking over their shoulders, and even editing their work, which kept them from feeling empowered to use their best judgment in carrying out their tasks. And I hadn't mastered the art of making people take possession of ideas as their own, too often insisting on the superiority of my own particular way of stating an idea, rather than letting others modify and adapt it.

I had also failed, apparently, in my effort to act on a sage piece of advice from that wise old owl, the McKinsey consultant John Stewart. Given the ambiguity of a group executive's role, John warned me,
I needed to seize on some particular issue or goal, make it my own, and become its corporate champion. I thought I had such a goal: to work on breaking down the organizational “silos” that stood in the way of effective communication and integration at GM, and to encourage greater candor and openness both within the company and in our interactions with the outside world. Whether because of the rigidity of the GM culture and the broad scope of my effort or because my personal style got in the way, I didn't manage to elevate that goal and become its successful champion. I could have used more lessons from my mother, an expert in using her charm to get people, men and women alike, to do what she wanted.

Finally, and most devastatingly, I didn't have the guts to follow through on suggestions for cutting costs by eliminating activities and streamlining the organizational structure of the Public Affairs staffs. When I asked for, and received, dozens of suggestions from members of the Public Relations staff along these lines, I responded to too many of them by explaining why the idea wouldn't work, rather than telling them to get to work on implementation. I never pushed the vice presidents of Government Relations and Public Relations hard enough to come up with ideas for combining some or all of their functions under a single vice president. And when the deputy head of Environmental Activities assembled a task force to come up with a plan for parceling out that staff, which was widely regarded as ineffective, to other parts of the company, I vetoed it as too risky.