Global Growing Pains - GM Powertrain reshuffles responsibilities

First it was small-car platforms, then Buicks in Shanghai; small cars and pickups in Brazil; a Cadillac for every continent. More recently powertrain development is revamped around four centers in the United States, Europe and Japan.

By the time this reaches your desk, stamping operations may follow suit.

General Motors Corp.'s march to globalization continues undeterred by Asia's financial flu or cultural clashes between German and American engineers.

It has only been four months since GM Power-train Group announced that it would divvy up its engine and transmission development among four engineering centers. A European Powertrain Center in Ruesselsheim, Germany, takes control of small gasoline engines and transmissions. A North American Powertrain Center in Pontiac, MI, is in charge of large car and truck gasoline engines and automatic transmissions.

Saab Automobile AB leads GM work on turbochargers for gasoline engines. Finally, all diesel development is assigned to Isuzu Motors Ltd. in Japan.

Ned S. McClurg, general manager of engineering operations for GM's Powertrain Group, is charged with selling a new globalized structure to those who will determine whether it succeeds or fails.

He knows what it is like to be caught between the theoretical logic - maximize common parts, eliminate redundancies, accelerate product development - and the real-world challenge of getting people from starkly different work and national cultures to pull together.

The idea is to take advantage of expertise in regional pockets of a vast corporation and transfer it throughout the organization. The goal is more innovative engines and transmissions at considerably lower cost, and to find quicker, more cost-effective ways of solving problems.

Take the following hypothetical situation. Say GM had an engine produced in Brazil, engineered in Germany and shipped to the U.S. for assembly. What happens if there's a quality issue related to the dual-overhead cam system?

"In the past ... most likely we would have come up with six proposals from six different locations, probably none of whom had talked with each other. Then we would have taken weeks to decide which one to implement. Now, we're much closer to having one common process in which everyone has some input."

But the execution can be threatening. Employees wonder if they must actively seek overseas assignments to advance their careers. They worry about new bosses who can't speak their language. If they were lucky enough to work an 8- or 10-hourwork day, they may be faced with meetings by tele- or video-conference in the middle of the night. Change is scary.

For managers trying to sell their workers on the benefits of globalizing, quelling these anxieties is just as important as refining direct-injection engine technology.

More often than not, the degree of upheaval is exaggerated along the internal grapevine. Indeed, operating globally will change many lives and jobs, but a surprisingly large number of people will go about their duties much as they always have.

"Do I have to convince every single lab technician or the person who sorts our mail?" he asks. "For many of them, this isn't such a radical change."

Others may embrace the opportunity for an international assignment to broaden experience or enhance career prospects. Some experienced and talented people may be reluctant to uproot young families and fear they may be penalized for a preference to stay put. Managers must strive to balance those dynamics while convincing everyone their buy-in is important.

There also are cultural and national biases inherent in any multi-national venture.

"We're all familiar with the stereotype that the Germans always know the right answer, the Japanese know the right answer and the Americans know the right answer," Mr. McClurg says. "And of course none of the answers are the same."

But maybe identical answers aren't what global engineering is about. For example, the L85 2.2L dual-overhead-cam 4-cyl. engine will power the Saturn Innovate and other future compact cars in GM's North American lineup. It was developed jointly with GM, Opel and Lotus engineers. Eventually, there will be a European L85, but it may be modified for diesel and mated to a European manual transmission. Common approach, different engines.

"I don't ever see the Germans wanting the same car we will sell in the U.S.," Mr. McClurg says. "But we can still produce the same displacement engine with different torque curves that will succeed in each of those markets."

He declines to say how few engine choices GM will be down to by the time this global powertrain strategy is finished.

"Obviously it will be a continuing study issue, but the specifics of how much we consolidate have not been worked out," he says. "Remember, we're still working on becoming one company. (GM Chairman) Jack Smith likes to say, the competition has never had to compete against General Motors."