Why does the world need Chrysler? Or General Motors?
As business models they are subsidized blackmail. In which the American taxpayers provide the subsidy and the guilt.
Were Chrysler or GM to fail, the loss of jobs and the reverberation through the American economy was deemed to be so devastating that we are told it is worth the price we pay to keep them both around.
In which case, wouldn’t it be better to use all this political, emotional and financial capital to build companies worthy of the investment.
Great companies, big and small, are run consciously.
They know why they are in business. The know what they are trying to achieve. And they work to create value for four groups of stakeholders.
- Customers
- Employees
- Suppliers
- Owners
There is no order of priority to that list. Great companies work equally hard for all four groups. And, unsurprisingly, the businesses who succeed in every area, produce the best financial results.
Both Chrysler and GM are off to a lousy start. As my friend Jerry Solomon wrote today, General Motor's self-serving approach to one group of suppliers is extraordinarily destructive. To any supplier short-sighted enough to accept their terms. And to themselves.
The Obama administrations have revealed their shock at the state of both companies. And came close to letting them fail. The inside story is here. It's worth reading. Chrysler were ultimately saved by the deal with Fiat. Which came with a heavy price.
Chrysler's new marketing chief, Olivier Francois, is also responsible for: marketing all of Fiat’s brands; leading all of Chrysler Group’s advertising; brand development and strategy development, and is also CEO of Chrysler. He will “execute his duties via a trans-Atlantic routine.”
His reputation as a marketer is that his work should first of all be noticed. And he is stronger on style than strategy.
Hardly a platform for a turn-around.
Perhaps we should collectively ask him to step into our office. Since, in large part he works for us.
Or perhaps we should simply decide that Chrysler and GM are both past saving and build companies that create things the world wants.
Starting with respect.
