GM told: Cut every salary


    Detroit Free Press Article

    How about “Reduce All Waste” as a rallying cry?

    Please check out my main blog page at

    The RSS feed content you are reading is copyrighted by the author, Mark Graban.

    , , , on the author's copyright.

    What do you think? Please scroll down (or click) to post a comment. Or please share the post with your thoughts on LinkedIn – and follow me or connect with me there.

    Did you like this post? Make sure you don't miss a post or podcast — Subscribe to get notified about posts via email daily or weekly.

    Check out my latest book, The Mistakes That Make Us: Cultivating a Culture of Learning and Innovation:

    Get New Posts Sent To You

    Select list(s):
    Previous articleLean at NUMMI
    Next articleGM’s Lutz: ‘I gave at the office.’
    Mark Graban
    Mark Graban is an internationally-recognized consultant, author, and professional speaker, and podcaster with experience in healthcare, manufacturing, and startups. Mark's new book is The Mistakes That Make Us: Cultivating a Culture of Learning and Innovation. He is also the author of Measures of Success: React Less, Lead Better, Improve More, the Shingo Award-winning books Lean Hospitals and Healthcare Kaizen, and the anthology Practicing Lean. Mark is also a Senior Advisor to the technology company KaiNexus.


    1. After reading the sidebar about York’s 5-step program for GM, the first thing that came to my mind is that this guy has made a sandwich with gourmet bread, but rotten meat. Suggestions 1 and 5 sound good. Basically a “get real” message. Suggestion 2-4 are rotten pieces of salami, ham, and bologna. 2. Cut everyone’s pay? Okay, cut executives who are already paid too much, but leave everyone else out of it. You start cutting pay and the rotten morale that already exists will go negative. You can cut pay at some companies, but those are the ones with charismatic leaders and employees that passionately love their workplace. Can GM claim that? I think that at the water cooler, the daily talk will be about which online job sites were surfed the entire day. Before cutting salaries of people that are working, shouldn’t they look at the Job Bank that is paying people not to work? 3. Sell Hummer? Isn’t that the most successful brand at GM? How about selling off or closing down something that is losing money? This sounds like someone wants to cash out of their high priced stock and get a bunch of cash. The problem is that Hummer is not stock. It is a company. You don’t dump your best product for short term gain. 4. The investors that still hole your stock highly value the dividend. If it is cut, I would expect GM’s market share to fall.

    2. GM has already cut pay for the salaried people. There has not been a raise for 18 months for anyone. I do not expect to see a raise this year. The 401K mathcing contribution is now zero. The part B retirement contributions have been cut. The older employees will stick with GM for the pension and health benefits. However anyone hired in the last few years has no pension, no retirement health care. This younger blood is will begin to drift away if raises do not occur in the salaried ranks. The phone calls from recruiters are aready making the rounds for some of the folks working in hotter areas. GM has problems hiring talent now. Cutting the salary pay to send a message is pandering.
      However, GM does need to cut the executive ranks significantly. The span of control of some executives and managers is too small. I’m aware of small companies with span of control by first line managers that match the span of control of directors in GM. Too many managers just equate to more permissions required to start work of justifications that need to be generated to defend projects.
      Yorks ideas may have applied to Chrysler in the 80’s however, I think some of them are short sighted today.


    Please enter your comment!
    Please enter your name here

    This site uses Akismet to reduce spam. Learn how your comment data is processed.