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Alaina Love
Leadership author

Alaina Love

Alaina Love is co-author, with Marc Cugnon, of The Purpose Linked Organization and co-founder of Purpose Linked Consulting.

GM's 'arrogance' virus

Question: After a well-chronicled, 30-year decline into bankruptcy, General Motors is now profitable again and going public. What does it say about its former executives, directors and union leaders that such a large, complex organization could be revived in less than two years? What factor best explains why leaders don't take the hard but obvious decisions necessary to prevent an impending disaster?

Former GM leaders must have forgotten to take their flu shots. It's the only reason I can come up with for the particularly virulent form of flu virus they suffered from, called arrogance. The infection manifested over time, and then spread through the organization and perhaps parts of the auto industry in various ways:

GM arrogantly believed they could indefinitely dictate the requirements and taste in automobiles for the American public.

They were arrogant in their abdication of responsibility for the environment, preferring to fight regulations that would protect our fragile planet rather than taking a leadership role by focusing the sizable talent of GM engineers on creating climate friendly cars....and actually bringing them to market sooner than competitors.

They arrogantly believed that foreign manufacturers were likely to produce lesser products that the American public wouldn't purchase. That is until Toyota came along and ate GM's lunch, Honda their breakfast and European manufacturers their dinner. By the way, GM would be wise to watch out for both Subaru and Hyundai, who are as we speak nibbling on pre-dinner hors d'oeuvres.

There's something about being caught in public with your lingerie around your ankles. It tends to be a humbling experience and often tempers the virus from which GM suffered. The collapse of this empire ushered in new thinkers (in part thanks to the U.S. government), those both willing to listen and willing to act. GM now has leaders who appear to be focused more on saving the business than padding their bank accounts.

But as the patient recovers, the question remains: Will GM's leadership be able pull off this IPO and restore the nation's faith in the industry? No pressure, GM leaders, just sayin'...

By Alaina Love

 |  November 15, 2010; 5:37 PM ET
Category:  Corporate leadership , Crisis leadership , Failures , Leadership weaknesses , Making mistakes , Managing Crises , Organizational Culture Save & Share:  Send E-mail   Facebook   Twitter   Digg   Yahoo Buzz   Del.icio.us   StumbleUpon   Technorati  
Previous: Too big to U-turn | Next: The 'mechanics' of leadership

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Don't overlook the Chinese auto industry. Even Buffett is an investor over there. I will come in our future, how long, I don't know. Who would ever have thought Hyundai would be as popular today?

Posted by: 18taipei | November 24, 2010 9:33 AM
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Great article! It really is amazing how little attention GM paid to modernization in the build-up to their crash. Hopefully they and many other American companies have seen the error of their ways...

Posted by: Fabianvf | November 18, 2010 6:48 PM
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GM's many mistakes are correctly identified in Ms. Love's comments. Beyond arrogance, or maybe because of it, GM overlooked the fact that they are operating in an open, global economy. Everyone wanting a place in this industry has studied GM's track record, business methods and road to success. They also studied all of GMs mistakes and weaknesses. Now they are using what they've learned to outperform GM. With arrogant leadership, GM has only made that easier.

Posted by: MartinG1 | November 16, 2010 10:37 AM
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