On the Recent Passing of Two American Auto Industry Legends: Lee Iacocca and Ross Perot
Ross Perot, founder and former CEO of EDS, also passed away a week later. In reading about him recently, I learned Perot didn't like to be called “H. Ross Perot” because he thought it sounded too snooty.
When I was growing up around in the 1980s, Iacocca was by far the biggest personality of the Big Three CEOs at the time. Iacocca, of course, starred in Chrysler commercials where he challenged the public, “If you can find a better car, buy it.”
I remember Iacocca as a driving force behind the restoration of the Statue of Liberty in the 1980s. Read the remembrances posted on the Ellis Island Foundation website. Iacocca also created the Ford Mustang. What a life!
Jamie and I are going to talk about both men in our next Lean Whiskey podcast.
You might not think of Ross Perot as an auto industry leader. You might think of him as a technology executive (EDS) or as a presidential candidate with his charts and all. Like Iacocca, Perot starred in commercials… but 30 minutes long instead of 30 seconds and the product was himself:
I remember a time when people tried drafting Iacocca to run for President, so there's another near similarity between the two.
When General Motors bought EDS in 1984, Perot ended up with a seat on the GM board of directors. I think GM had hoped that Perot and EDS would make GM more nimble and entrepreneurial, but it didn't pan out that way. Perot was bought out and fired from the GM board in 1986 and GM spun off EDS in 1995.
The most memorable expression from Perot was about GM and “committees on snakes.”
Here is the full quote from a 1988 article in FORTUNE… I had forgotten about the consultant part:
“They can design, engineer, and build the best products in the world.
My question is: Why haven't we unleashed their potential? The answer is: the General Motors system. It's like a blanket of fog that keeps these people from doing what they know needs to be done.
I come from an environment where, if you see a snake, you kill it. At GM, if you see a snake, the first thing you do is go hire a consultant on snakes. Then you get a committee on snakes, and then you discuss it for a couple of years. The most likely course of action is — nothing. You figure, the snake hasn't bitten anybody yet, so you just let him crawl around on the factory floor.
We need to build an environment where the first guy who sees the snake kills it.
At Electronic Data Systems employees were trained from the day they joined the company to spend all day serving the customer, getting results, being the best in the world — not being good bureaucrats.
At GM the stress is not on getting results — on winning — but on bureaucracy, on conforming to the GM system. You get to the top of General Motors not by doing something, but by not making a mistake. You form groups, hold meetings, get consensuses, don't make decisions. You just kind of let this big old log keep rolling, knowing that sooner or later you're going to retire and get a big retirement anyhow.”
Only Ross Perot could think of saying something so true so colorfully.
Another spot-on summary from him:
“One day I made a speech to some senior executives. I said, ”Okay, guys, I'm going to give you the whole code on what's wrong. You don't like your customers. You don't like your dealers. You don't like the people who make your cars. You don't like your stockholders. And, to a large extent, you don't like one another.
”For this company to win, we're going to have to love our customers. We're going to have to stop fretting about dealers who make too much money and hope they make $1 billion a year through us. The guys on the factory floor are the salt of the earth — not mad-dog, rabid, burn-the-plant-down radicals. And all this sniping at one another — the financial guys vs. the car guys — is terribly destructive.”
Perot had hoped to change GM… what a challenge to take on:
“I told General Motors very openly that the only reason I was selling my company to them is that I couldn't think of anything more interesting to do with my life than to work night and day to help revitalize one of the world's great corporations and help it achieve its full potential. I'll work night and day to help them. They grew up inside the system, and things that are killing the company may still look normal to them.”
That last sentence definitely reminds me of many hospitals…
Rest in peace Mr. Iacocca and Mr. Perot, as we remember two legendary leaders.