GM and Their Corporate Culture Seen in Harsh Light – Follow Up

GMA 315 page report was published showing GM and their Corporate culture in all its faded glory. The report contains the companies short comings in the handling of the ignition switch issue, which has since caused death and harm to consumers. Mr. Anton Valukas, who conducted the investigation has described such things as the “GM nod’ and the ‘GM salute’ as two of the things that further complicated the issue, and were implicated in a number of erroneous decisions. The nod refers to meetings where the issue was brought up over the years, and during a time when a number of committees met, and everyone just nodded in agreement that something should be done. Yet no one actually did anything. The salute refers to the age old pointing of fingers, leaving everyone blaming someone else and not a single person to take responsibility.

The following are some of the findings from this report:

Corporate Culture – GM Committee’s proposed solutions however, they died right there in the meeting rooms. No one would own any decision or move forward on any decision. Everyone believed that someone else was responsible or should be responsible, therefore the Cobalt investigation went on for years. This lending credence to Barra’s description of the ‘GM nod’ where the committee’s all agreed there was a problem and something should be done, and left everyone nodding in agreement but no one to take action.

Engineering Failing to Classify the Ignition Switch Issue as a Safety Concern – For over 10 years it was known that the switch led to stalling while driving but no action was taken. Engineers were notified of the fact that the key being moved to the off or accessory position would not allow the airbags to deploy, but failed to recognize this as a safety issue and did not escalate the problem in order to solve the issue. The switch moving was viewed as an inconvenience and not a real problem, and was classified as annoying.

Switch bought was sub-standard – The switch on the vehicles did not even meet GM’s own standards, and were in fact far below their usual product quality. Problems were known by the Engineering group in the early stages of production, but they deemed the issues as ‘rare’ occurrences.

Delay of Action Caused by Investigating Root Cause of Air Bag not Deploying – Airbag failures were on the Engineering groups radar, and in 2011 they spent their time trying to nail down the root cause of this failure. The time spent on this issue delayed bringing the ignition switch issue to light for over two years. In 2013 it was well known that the switch could be accidentally put into the accessory position, and when that happens the airbags would not deploy. They changed out the switch’s on the 2008 models only, and that was due to a lawyer for the family of a crash victim that had made some incriminating discoveries.

Upper Management was in the Dark – While these internal investigations were touched by numerous people, such as engineers, lawyers and investigators, no one escalated it to the management level. This left the people in the best position to address the situation in the dark. The part had problems right from the beginning and even after a redesign if failed to meet minimum torque requirements, meaning it took far less effort to turn than requirements mandated. The report states that Mr. DeGiorgio approved the part for production believing the issue would not affect the performance of the vehicle. He has since been relieved of his job duties.

Recommendations to GM by Valukas – The report not only documented the facts, but also offered recommendations for corporate cleansing, and changes needed to be made to the overall corporate structure. Among his suggestions is that the company needs to start using the agency that regulates vehicle safety as more than just a regulator, and to use them to ensure vehicles are as safe as they can be. Valukas also recommends GM lawyers meeting regularly to analyze patterns and safety concerns. A company wide culture change emphasising safety, and getting rid of departments responsibilities that overlap to avoid finger pointing.

Conclusion of the Report – It was pointed out that there was too little urgency and too much dragging of the feet. The report is very extensive and there is a lot more not covered here. The full report can be viewed on GM’s website.

By Kristi Cereska

Corporate Intelligence
NBC News

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