Womack comments on GM-NR

ABC News: Can a Charismatic CEO Save GM?

GM partnering with Nissan Renault? Jim Womack doesn’t think it will help:

“It’s hard to see how this deal has anything to do with doing a better job on any of those fundamentals” such as building better automobiles, said James P. Womack, an industry analyst at the Lean Enterprise Institute. “It’s a big spin opportunity to make something happen in what otherwise appears to be a fairly desparate situation for GM.”

Getting bigger doesn’t mean they’ll have improved any processes or value streams, eh? As Tom Peters would point out, getting bigger NEVER results in getting more nimble.

A professor from Maryland says (how do they find these guys to quote?):

“And second [after labor costs], GM has a legendary bureaucracy that drives up product design, marketing and administrative costs,” Morici said.

The beginning of the article laid it out:

Detroit is considering a potential mega deal, creating an international car-making colossus by combining the forces of General Motors, Renault and Nissan. Think of it: a combined 15 million new cars annually.

Isn’t GM already an international colossus of mega-mega size? Getting bigger and being able to squeeze suppliers even more is the answer?? Maybe if you view the world through a “cost” lens. But, when viewed through the “lean value stream” lens or the “effectiveness” lens, I don’t see how being bigger helps.

People are wondering if the “charismatic” CEO approach is really sustainable, even with Ghosn:

There is also the untidy fact that while Ghosn set the world on fire at Renault and Nissan initially, the performance at both companies lately has been disappointing and market shares have dwindled.

Firing people and firing people up…. that might just a one-time “special cause” activity. Have Renault and Nissan really changed their processes for the long term to build real sustainable change? Sometimes a guy like Ghosn (or maybe a Mark Fields, of Ford) bounce around from role to role because they are good at lighting fires and making short-term change rather than building something sustainable?

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Mark Graban's passion is creating a better, safer, more cost effective healthcare system for patients and better workplaces for all. Mark is a consultant, author, and speaker in the "Lean healthcare" methodology. He is author of the Shingo Award-winning books Lean Hospitals and Healthcare Kaizen, as well as The Executive Guide to Healthcare Kaizen. His most recent project is an eBook titled Practicing Lean that benefits the Louise H. Batz Patient Safety Foundation, where Mark is a board member. Mark is also the VP of Improvement & Innovation Services for the technology company KaiNexus.

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4 Comments on "Womack comments on GM-NR"

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  1. curiouscat says:

    > how do they find these guys to quote?)

    See:

    http://www.ajr.org/Article.asp?id=3857

    http://www.askdavetaylor.com/how_do_i_get_quoted_in_the_newspaper.html

    http://www.dartmouth.edu/~news/features/experts/

    I think this is an interesting question too. They also are good networkers who once they find a good source use them over and over. you also see many popular blog posters getting quoted (not so much in management/manufacturing area yet that I have seen but in areas like the internet, politics, technology…

    Obviously Womack has started to become a fairly popular source of quotes for some business writers.

    Publicists facilitate journalist quotes too. My guess is journalists basically want 1) good quotes (interesting, short, engaging) 2) quick answers to their questions to meet deadlines 3) something that gives credibility (professors are good for this, authors, recognized experts in the field…).

  2. Jamie Flinchbaugh says:

    A few comments from me:

    1. I can’t say I agree with Tom Peters (who has a track record of being wrong – In Search for Excellence). Ask any small company that can’t do all the things they want to do and simple things like letterhead and hiring people become almost monumental. Getting bigger can mean more nimble – it’s all in how you do it.

    2. I wouldn’t compare Fields to Ghosn. Is Ghosn a all-powerful magical executive that some promote him as? No, but he has delivered results. He is respected, and has saved Nissan from the bowels of elimination. Can he save GM? I don’t think he’s a “SOLUTION” to the “PROBLEM” but he has done some great things.

    3. Lastly, this story is getting way too much press. First of all, we’re only talking about buying 20% of the stock. That is significant, yes, but a far cry from a merger. It doesn’t put Ghosn in and Wagner out. It doesn’t mean seemless sharing of brands and technology. It just means they are in bed together. And no one is considering that this deal takes two to tango, and it is very unlikely GM will go along with it. After all, whether it is good or bad, why would they? The only thing it delivers is cash, which isn’t their problem.

  3. Mark Graban says:

    The Tom Peters reference is always in the context of big companies getting bigger, such as two large public companies merging (or think Daimler-Chrysler or GM-EDS).

  4. Mark Graban says:

    A journalist friend told me once that they are basically lazy (nice generalization) and that they tend to get quotes from people who have already been quoted.

    Terms like “professor” get credibility. Somehow the phrase “investment advisor” or “CEO of JoeBlow Investments” (when you’re the CEO of a two-person firm) gets your credibility with journalists too.

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