Ford and GM Heritage: Us vs. Them

Over the Holidays I couldn’t stop thinking about the auto industry and its problems. I’m still convinced there will be money from the government to prevent bankruptcies. The most recent news in this regard is the provision of $5 billion to General Motors’ financial operation, GMAC, which was allowed to convert itself into a bank in order to receive these monies. Most insiders feel that the Obama administration won’t let Detroit fail, and I agree.

The more interesting question is, how did we get here in the first place? And I think one of the important answers is rigidity.

I recently assigned a writer to track down some small companies in the Detroit 3 supply chain that had successfully expanded their there business to include non-automotive customers. She couldn’t find any. The reason companies she talked to gave for failure to diversify had to do with the very specialized nature of their capitol equipment.

But there’s another kind of rigidity that I think is equally important, and that’s the rigidity that exists in management-labor relations. In particular, the existence of a union leadership that depends on the perpetuation of an extremely harmful "us vs. them" mentality to stay in power.

It doesn’t have to be that way. I recently saw an amazing segment by PBS business commentator Paul Solman that featured a GM plant in Michigan where the union boss and the plant manager work side-by-side and collaborate on a daily basis to make things work. As a small manufacturer, of course, you already enjoy this kind of relationship.

Or do you?

A new year is beginning with enormous potential challenges. Are you going to face it alone, or as the leader of a group of employees who come to work every day trying to help you win? Do they feel that when you win, they win? Are you listening to them?

When I was running a print production group in the 1980’s, I bought into the amazing capabilities of the then-new Macintosh computers, and designed work flows where they played a key role. But, in my management-by-wandering-around style, I soon realized that my production people were "stubbornly" sticking to old manual methods. When I asked about it they (somewhat shyly) explained that the computers were just too slow, so they were doing what they had to do to do meet deadlines.

That was when I realized that he people actually doing the work knew more about getting it done efficiently than I did, and that it was a mistake to be rigid in my approach. We officially went back to manual production, and introduced computers slowly, when they made sense.