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Thu June 19, 2014
Mary Barra appears before House subcommittee on ignition-switch debacle
General Motors CEO Mary Barra appeared this week before a House subcommittee that is investigating the automaker's ignition-switch debacle.
Barra didn't sugarcoat the fact that GM bungled this terribly. She freely admitted their engineers knew about the switch problems 12 years ago, but didn't connect that to the airbag malfunction linked to at least 13 deaths.
And Barra had a litany of changes she's instituted in response, including firing 15 high-level employees.
Detroit News business columnist Daniel Howes says this has to go deeper.
“Members of Congress, to put it gently, (are) skeptical that a company like this with the track record that it’s had, particularly in the last five years, would be able to do that,” Howes said.
Howes says with exception of the president of GM, those at the top of the company are longtime General Motors people.
“I think there is a real belief in the outside world that people from the inside of General Motors can’t change the way General Motors behaves because they are products of that culture.”
However, Howes says he does not fully believe that, citing changes in the culture at Ford Motor Company in 2006.
Howes said he thinks the recall scandal is building up pressure on Barra and the company to make changes fast.
“At the end of the day – and I think this was the message of the hearing – you can talk about culture change all you want, but it’s all measured by what you do, not what you say,” Howes says.
Howes says that at a deeper level there was a sort of management union: Once you are in you are in. When a manager’s performance was not up to par, instead of firing them, they demoted them, leaving the employee angry and resentful and doing a worse job.
“They moved problems around, they didn’t solve problems, personnel problems,” Howes said.
*Listen to full interview above.