Continuing in a series of posts about GM and organization design, let’s take a closer look at creating the right organization for Chevrolet. I know restructuring is not this simple; so take this as the first installment in a high level comparison of organization design options, not a comprehensive plan of action.
Let’s start with Chevrolet, because that’s the easiest to imagine given their current situation.
To me, Chevy is Americana. This is the car that represents the American Dream, value, performance, and accessibility.
Chevrolet should help people get their first car, the family car, and have a competitive truck option. This market means head-to-head competition with Toyota and Honda, so it has to be efficient and cost competitive and produce top quality, reliable, desirable vehicles. Check out this post on The Truth About Cars for a quick review of the Chevy brand.
Key Traits of the new Chevrolet organization:
1. Efficient hierarchical structure. Clean lines of authority to provide clear direction, efficient decision-making, speed to market, and drive focus on customer needs as the basis for every action. This market is not about sexy cars, it’s about helping people feel good while they get places safely and manage household costs.
2. Make each model a business. Get past the silos of design, engineering, marketing, etc. and organize each model around a General Manager, with a P&L outcome and a target consumer to drive functional integration. Fidelity Investments organizes this way (dozens of P&L units), and it works really well. Develop a rabid consumer orientation as a rallying point, rather than being fractured by functional expertise.
3. Restructure the supply chain. As pointed out by Charles Mann in Beyond Detroit, source great parts from the best suppliers by developing a modular platform. Don’t try to own everything, focus on total design, build, and sell.
4. Engage employees. Focus on great leadership and build pride (See Jon Katzenbach). The days of management v. labor must be left behind. This organization needs every single person engaged in a mission to deliver cost competitive, high quality vehicles. Organize production around manufacturing teams provide job rotations to help employees learn, grow, and develop as a natural component of work. Use the portfolio of models to allow employees career movement.
5. Reward performance. Pay individuals, teams, and business units more when they meet performance goals in revenue, quality, and costs. Create healthy internal competition between the businesses.
Next up, how to recover the SATURN brand through an open-source organization.