Newly minted CEO Ed Whitacre wastes no time in putting his stamp onCo., announcing key executive moves just three days after former CEO Fritz Hendersonâs sudden departure.
The shuffle elevates the auto makerâs top engineer, Mark Reuss, 46, to president of GM North America; puts Nick Reilly, who had been head of International Operations, in charge of GM Europe; and moves Vice Chairman Bob Lutz out of marketing and back to a role related to product development and design.
The action sheds some light on the falling out Henderson had with Chairman Whitacre and the rest of the GM board over the last few weeks, culminating in what Whitacre described Tuesday as a mutually agreed decision for Henderson to resign.
In disclosing Hendersonâs departure this week, Whitacre emphasized the need to move faster as a company.
Under Henderson, GM had yet to name a permanent head of GM Europe following the departure of Carl-Peter Forster after an earlier decision not to sell Adam Opel GmbH to a consortium led by supplierInternational Inc.
Under Whitacre, Reilly, 59, got the job by way of executive order. A spokesman says a search is expected to continue for a new Opel CEO, who would report to Reilly.
In North America, Henderson had been relying on 77-year-old Lutz to revamp GMâs marketing and find a way to rebuild the companyâs image with consumers.
Having come to GM from, Lutz had served as a change agent at GM, reworking the product-development process and refocusing the auto maker on building competitive cars and trucks.
Many of the new vehicles developed under Lutzâs regime have garnered critical praise and are fetching higher prices in the market. Henderson appeared to be relying on Lutz to work the same magic on the marketing side. Lutz had been slated to retire this year when he agreed to stay on to oversee marketing.
But Whitacre is reaching down into GMâs ranks and promoting a younger team to new high-level jobs. Worth noting is Lutz now is being called an âadvisorâ on product development and design, suggesting his remaining tenure with GM will be less hands-on.
âI want to give people more responsibility and authority deeper in the organization, and then hold them accountable,â Whitacre says in a brief statement. âWeâve realigned our leadership duties and responsibilities to help us meet our mission to design, build and sell the worldâs best vehicles.â
Recreating the post of North American president, which had been vacant since the departure of Troy Clarke earlier this year, restores the region as one of three profit centers (Europe and International the other two) in the GM hierarchy.
âThere are now clear lines of responsibility and accountabilityâ in North America again, GM spokesman Tom Wilkinson says.
Key members of Reussâ North American team include Susan E. Docherty, 47, who is named vice president-vehicle sales, service and marketing, and Diana D. Tremblay, 50, named vice president-manufacturing and labor relations. Tremblay had been vice president-labor relations, a positioned now turned over to former small-car vehicle line director Denise C. Johnson.
Docherty earlier this year was named head of sales in North America. She and Lutz, as the marketing chief, reported directly to Whitacre as chairman of the board. The new position recombines the two disciplines, eliminating any chance of finger pointing if sales and market-share goals are missed.
âWhen those are separated, it makes it harder to have responsibility with one person,â Wilkinson says.
Thomas G. Stephens, who remains vice chairman-Global Product Operations, adds global purchasing to his organization. Robert E. Socia, vice president-global purchasing and supply chain, now will report to Stephens.
The move to combine purchasing with product development reflects the changing nature of procurement, Wilkinson says.
âItâs no longer about beating up suppliers to get the best price,â he says. âItâs more about cultivating suppliers and getting the next great technology.â
Karl-Friedrich Stracke is now vice president-(global) engineering, replacing Reuss and also reporting to Stephens. Previously, Stracke served as executive director-engineering.
Taking over as president-GM International Operations for Reilly is Tim Lee, formerly vice president-manufacturing and labor relations.
Whitacreâs actions may signal he expects to be in the top job for some months at least, as he re-jiggers GMâs executive ranks rather than wait until a new CEO is at the helm. He told employees earlier this week it could take a year to find the right person to fill the slot.
âI think people were encouraged by that,â says Wilkinson. âTheyâre going to take the time to find the right CEO. Theyâre not just going to fill the chair.â
In his role as chief engineer, a job he assumed just five months ago after heading GM Holden Ltd. in Australia, Reuss appeared to be one of the most aggressive at leading the called-for cultural change in North America.
Reuss spoke with reporters recently about encouraging engineers to not be afraid to point out quality and design issues, a problem that has plagued the auto maker and resulted in uneven quality and performance in its cars and trucks.
One of Whitacreâs marching orders is to perform better in quality rankings by publications such as Consumer Reports and other third-party organizations.
âOver my career, weâve been a company that has continually downsized, reorganized, changed â it hasnât been a growing, prosperous experience,â Reuss said. âAnd if everybodyâs afraid to surface a problem because theyâre afraid of (losing) their job, and they donât think that telling about the problemâŚis going to help solve it â itâs going to be punitive, youâve got a real problem.
âAnd I think weâve had this problem.â
In addition to the executive changes, GM says board member Stephen Girsky, a former Wall Street auto analyst, will play a more significant advisory role at the company. Wilkinson says specifically how Girsky will work with the executive team remains unclear for now.
No other executive moves appear imminent, though Wilkinson suggests there likely will be some shuffling within the next couple of years as some of the older members of the team, such as Reilly and Stephens, look toward retirement.
Despite the shock registered by the events of the past week, the company has been âenergizedâ by the actions, Wilkinson says.
âThereâs pressure on Whitacre, too, to get this company on the right road again,â he says. âThe message (the new CEO has sent) is, âYouâve got the tools, now go get the job done.ââ