GM's Whitacre Plan: Just Make Money
One month into his tenure as CEO of GM, Ed Whitacre Jr. has a pretty simple game plan for getting GM back on track: just make money. Don't laugh. It's what the man has said time and again, most recently Wednesday afternoon when talking with reporters. While his strategy may sound hokey and simple, I think it's exactly what GM needs right now.
For decades, being slave to metrics, market share, and department goals has crippled GM. In other words, as GM's various departments, brand chiefs, and division leaders have been working towards hundreds of separate benchmarks. In the process, they often couldn't see the forest from the trees. So even as GM would lose billions of dollars, executives would tout their success in hitting a certain market share or benchmark.
Under Whitacre, GM still has metrics and performance targets for its departments and executives, but the bottom line is making money. The company's chairman and CEO have said time and again, "Nothing else matters if we don't make money." He's right. So what if GM gets 20% market share? Or if the company is #1 in China? Both are great, but they man nothing if GM can't turn a profit.
Whitacre believes GM will be profitable this year. He admits the company still has hurdles in getting there. It still has to figure out what to do with Opel and its U.S. business is far from robust. Still, Whitacre is encouraged by what he's seeing and company's performance in December. The big issue is boosting revenue by selling more vehicles.
Now, the real challenge and only goal for Whitacre is to just make money.
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