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In my view, if the organization is structured in a way that the responsibility is dispersed to the extent that no one is responsible, then CEO has to pick up the tab. Wouldn't it be great to have CEO's pay the fines and do some involuntary community service rather than house them at taxpayer's expense?
GM probably has many great and brilliant people. In my view, the environment, structure and the tone from the top have a lot to do with either bringing out the best or the worst (or something in between) in people. Setting the tone is in no way equivalent to micromanagement.
jcaspar
Member
I wonder if they will be fined as much as Toyota was for their similar actions that resulted in several deaths. That was a criminal probe where they full admitted wrong doing and were fined 1.2 Billion dollars, the larges fine in US auto history and fully admitted to the criminal action. I believe they are still undergoing monitoring to prevent further such actions. I suspect GM will face something similar but maybe not as much of a fine as they seem to be working with investigators where Toyota intentionally tried to cover up their actions.
No new car sales for a year. Although the fines look big to us, they are chump change for these very large corporations. After all, if a person commits a serious crime (and sometimes a not so serious crime) they get put in jail for many years and can't earn any income. If you're going to make corporations people, they should have similar punishments. Of course, if corporations are people, then they should have the same social responsibilities. If a real person acted like a major corporation they might not go to jail, but they wouldn't have any friends either.
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It seems to me that no one at GM committed a serious crime. No one acted in a malicious way. Many people maybe failed to do their job in the most diligent way, most likely due to operating in an environment that facilitated decisions based on costs rather than safety. Collective actions resulted in very unfortunate outcomes.
Many people often have to make judgement calls that might go wrong. If they are instantly punished for wrong judgement call, that creates an environment of avoiding to make a call at all and avoiding responsibility, something like GM culture. My point is that punishment is not effective in correction, quite contrary, it creates the environment that facilitates more of the deeds for which punishment was first meted out.
GM seems to be improving. I don't see how shutting it down might make anything better.
I agree with this. I was only commenting on the "Corporations are People" as Citizens United would like them to be. As long as corporations are business entities and not equal to people, they can be treated as business entities.
Internal report found that GM engineers or investigators did not understand for years that there was a connection between the faulty switch and the failure of air bags deployment in a crash. These two problems were treated separately. Faulty switch was classed as inconvenience issue, not as safety issue, as GM investigators failed to fully understand the consequences of switch cutting power inadvertently.
Internal report findings may be questionable due to conflict of interest. GM commissioned the report. It will be interesting to see the outcome of external investigation.
It seems to me that the difference between GM's recalls and Tesla recalls is that Tesla has been proactive. Two cases of underbody piercings with no bodily injury led to immediate retrospective changes in underbody armor for all cars made buy Tesla. Tesla's attitude and approach is refreshing and warrants garnishment.
Tesla is a young company that wants to be known as producing the cleanest and the safest car on the road. Musk has stated that he wants the owners to have a great experience. When there is any question about the design of the car, Musk moves proactively to eliminate doubt. It could be a simple explanation or it could be a design change. Whatever action is necessary is done as expeditiously as possible to ensure the change does as it was intended to do. Tesla doesn't have the option to ignore issues. There is attention focused on the company and if they trip, they can easily fall.
GM is entrenched. The mindset of this huge monstrosity is unwilling to change. If there were to be a change, after the decision to go another route, it takes time to turn the ship. Incentives, aspirations for ascension up the ranks, and the tendency for this company to employ techniques that apparently insulate upper management from blame, all contribute to the situation we now are seeing.
And with all that, the customers have ignored the fact that even the latest GM cars are being recalled. The customers just keep coming back for more. What is the incentive to change? Or how significant a change will occur?
I was really surprised to hear that an engineer could change the design of a part and not change the number. Anytime a part is changed because it wasn't functioning as intended, it is supposed to get a new part number or a designation that clearly identifies it as a different version. This wasn't done and it must be explained. How could it happen? The issue of it being changed because it was an inconvenience issue and not a safety issue doesn't change the fact that the part number wasn't changed. I see that as the smoking gun that indicates that GM did not want to admit there were problems with the ignition switch.
So this might have been a criminal act. It involved more than a change on a piece of paper. The reason for the part design change came from someone. The paper design was changed and the production of that part was changed because new components for that part were changed, yet the part number remained the same. There are more people involved in keeping this secret.
Was it systematic failure or was it conspiracy? If a conspiracy is proven, then everyone who played a part in the decision to not change the part number is culpable in a cover-up that resulted in preventable deaths. Lawyers will employ any red herring that might obscure the issue, but I think that's all it is. Proving it will be something else. Lawyers make the big bucks for a reason.
Not enough has been done to protect the public, but does the public deserve more protection? The word is out about GM, but the public continues to beat a path to their cars. The same public complains about the politicians being corrupt or incompetent, but the public re-elects them. How can anything change for the better in this country as long as people are this stupid? Maybe it is best to quote Einstein "Insanity: doing the same thing over and over again and expecting different results."
Don't be insane - buy a Tesla and vote incumbents out.
GM is entrenched. The mindset of this huge monstrosity is unwilling to change. If there were to be a change, after the decision to go another route, it takes time to turn the ship. Incentives, aspirations for ascension up the ranks, and the tendency for this company to employ techniques that apparently insulate upper management from blame, all contribute to the situation we now are seeing.
And with all that, the customers have ignored the fact that even the latest GM cars are being recalled. The customers just keep coming back for more. What is the incentive to change? Or how significant a change will occur?
I was really surprised to hear that an engineer could change the design of a part and not change the number. Anytime a part is changed because it wasn't functioning as intended, it is supposed to get a new part number or a designation that clearly identifies it as a different version. This wasn't done and it must be explained. How could it happen? The issue of it being changed because it was an inconvenience issue and not a safety issue doesn't change the fact that the part number wasn't changed. I see that as the smoking gun that indicates that GM did not want to admit there were problems with the ignition switch.
So this might have been a criminal act. It involved more than a change on a piece of paper. The reason for the part design change came from someone. The paper design was changed and the production of that part was changed because new components for that part were changed, yet the part number remained the same. There are more people involved in keeping this secret.
Was it systematic failure or was it conspiracy? If a conspiracy is proven, then everyone who played a part in the decision to not change the part number is culpable in a cover-up that resulted in preventable deaths. Lawyers will employ any red herring that might obscure the issue, but I think that's all it is. Proving it will be something else. Lawyers make the big bucks for a reason.
Not enough has been done to protect the public, but does the public deserve more protection? The word is out about GM, but the public continues to beat a path to their cars. The same public complains about the politicians being corrupt or incompetent, but the public re-elects them. How can anything change for the better in this country as long as people are this stupid? Maybe it is best to quote Einstein "Insanity: doing the same thing over and over again and expecting different results."
Don't be insane - buy a Tesla and vote incumbents out.
Chickenlittle
Banned
i have to disagree with this part. Not all drivers were the buyers, passengers involved as well. Cars defective that cause accidents affect other cars that they collide with and then there is always pedestrians that can be injured. There is always a remarkable trust in operating a car that others will stop at lights, not drive recklessly and that other cars will operate safely to avoid impacting your life. We have no control over gm to uphold their part in everyone's safety other than the government
I suspect that most people believe all car manufacturers are like this, so it's just a case of picking your poison. All car manufacturers have recalls, and a recall is just a recall to most folks. Proactive doesn't mean anything to them because the proactive ones are just a step ahead of the sheriff.
I am obsessed with this GM example because I have seen over and over how easily culture eats brilliant strategy for breakfast in large organizations. I wonder if and how Tesla will be able to escape this inevitable fate of oversized entities.
It probably won't escape once Elon leaves and the bean counters and professional managers take over. Until then, which I hope is many years from now, Elon can short circuit this problem.
Thumb down for GM
It seems that GM leaders not only did not seek out bad news, they actively suppressed them. The ones at the very top, setting the tone, suppressed bad news.
I expected better from the best and most privileged amongst us.
GM was not only riddled with plain and common incompetence, there is a latest twist to this story.
Reuters: GM board warned of serious problems by quality manager in 2002.
Highlights:
A former head of General Motors corporate quality audit warned the company’s board in a letter in 2002 that it needed to “stop the continued shipment of unsafe vehicles” and “recall suspect vehicles that were already in customers’ hands.”
McAleer, former head of a group responsible for quality checks on cars shipped in North America, said his unit regularly found serious problems in new vehicles and that when he raised his concerns he was told his team should stay out of safety issues.
He told the board it should stop shipments of unsafe cars, launch recalls, and revise quality controls to make the company “independent of corporate politics and cost-cutting concerns.”
A copy of the letter was sent to each of the 12 directors at the time – including then CEO Rick Wagoner and then Chairman John Smith.
In it, McAleer accused the highest ranking quality executive in North America at the time, Tom LaSorda, of a “stonewall” that included trying to stop McAleer from contacting higher management. LaSorda, who was then a GM vice president, later became CEO of Chrysler and then CEO of Fisker Automotive. He is currently a venture capitalist at IncWell.
Valukas team reviewed all board correspondence dating back to 2003. McAleer’s letter to the board is from July 2002. Not surprising, since Valukas was commissioned by GM.
It seems that GM leaders not only did not seek out bad news, they actively suppressed them. The ones at the very top, setting the tone, suppressed bad news.
I expected better from the best and most privileged amongst us.
GM was not only riddled with plain and common incompetence, there is a latest twist to this story.
Reuters: GM board warned of serious problems by quality manager in 2002.
Highlights:
A former head of General Motors corporate quality audit warned the company’s board in a letter in 2002 that it needed to “stop the continued shipment of unsafe vehicles” and “recall suspect vehicles that were already in customers’ hands.”
McAleer, former head of a group responsible for quality checks on cars shipped in North America, said his unit regularly found serious problems in new vehicles and that when he raised his concerns he was told his team should stay out of safety issues.
He told the board it should stop shipments of unsafe cars, launch recalls, and revise quality controls to make the company “independent of corporate politics and cost-cutting concerns.”
A copy of the letter was sent to each of the 12 directors at the time – including then CEO Rick Wagoner and then Chairman John Smith.
In it, McAleer accused the highest ranking quality executive in North America at the time, Tom LaSorda, of a “stonewall” that included trying to stop McAleer from contacting higher management. LaSorda, who was then a GM vice president, later became CEO of Chrysler and then CEO of Fisker Automotive. He is currently a venture capitalist at IncWell.
Valukas team reviewed all board correspondence dating back to 2003. McAleer’s letter to the board is from July 2002. Not surprising, since Valukas was commissioned by GM.
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I am probably going a bit off topic here but with a resume like GM, Chrysler and Fisker and all 3 companies going bankrupt. Coincidence?
Well, you have to bear in mind that in many large companies the CEO's job is to get as much money out of them (for him/herself) as possible while making this quarter's profits look good. Long term interests of the company are somewhere near the bottom of the list. When the company goes bankrupt they still get more money as an exit fee than most people make in a lifetime.
That is one the problems. There is direct misalignment between CEO's interest and long term interest of the business.
Shareholders and board are supposed to correct this, but shareholding power is usually diluted to non effective power.
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