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Thursday, April 03, 2014

Mary Barra Knows Nothing About Anything - Bloomberg View

Mary Barra Knows Nothing About Anything - Bloomberg View: "Although representatives from both houses showed deep frustration at Barra's "name, rank and serial number" approach to their questions, the hearings clearly yielded important evidence ... most notably that of Barra's reticence itself. Her experience within GM, her credentials as a "car gal," were heavily emphasized by GM's public-relations experts in the months leading up to the recall announcement. Now, just when her deep knowledge of GM might have been a huge asset, she acted as if she wore blinders for the last 30 years. Considering Barra is just the latest in a long line of GM CEOs who have noisily touted their "turnarounds" of the automaker, this was not a reassuring development."

But Barra's lack of answers was not entirely surprising. Within the broader cultural issues surrounding GM's approach to consumer safety and accountability lie two very specific quality control problems that fundamentally undercut her ability to reassure customers. First, GM took delivery of a part that was not up to its specifications, and second, changes to that part were not accompanied by changes to the part number. Between these two fundamental breaches of basic quality management, it's not clear how GM can reliably assure anyone of anything. The fact that Barra couldn't answer congressional questions is every bit as terrifying to consumers as if she had pleaded the Fifth Amendment.



Barra's defense has been twofold: That the ignition switch situation is "extraordinary"; and that it was the product of the Old GM's "cost-culture." The ignition problem may indeed prove to be "extraordinary," but Barra can hardly know that with any certainty, given that she doesn't seem to know how basic quality control was circumvented in the ignition switch case. For all she (or anyone else) knows, there could be many more of these problems lurking in the vastness of GM. Insisting she knows for a certainty that the ignition defect was "extraordinary" does not help her credibility...


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