“We failed these customers and we must face up to it and we must learn from it,” said Mary Barra, embattled CEO of GM, talking to Matt Lauer of NBC News. Barra seems to be intent on making the company acknowledge its mistakes (29 million vehicles recalled this year so far). Since she became CEO, GM has increased the number, size, and frequency of product recalls, including the faulty Chevy Cobalt ignition switches.
However, recognizing and admitting to mistakes is not the same as learning from mistakes. The question GM must ask itself is, “Does the organization know how to learn?” Do employees know how to use data to not only assess quality but to then reflect on the meaning of that information for the purpose of performance improvement? Do engineers know how to have a conversation that is more inquiry than advocacy? Will they truly listen to each other and use what they hear to continuously improve processes and products? Will managers share information with each other without fear of losing control or losing power?
Some might say, “GM is too big to change.” But large, global companies can change their cultures. Ford is an excellent example of this. As I wrote in a previous blog post, Ford CEO Alan Mulally led Ford through a culture change that was critical to going from billions of dollars in losses each year to billions of dollars in profit. As Joe Nocera describes it, Mulally brought honesty and openness to the Board room, broke down the departmental silos, kept a consistent focus on strategic goals, and held people accountable for contributing to the overall success of the company.
GM can do what Ford did but it will have to create a culture in which learning and change are valued. It’s not enough to have the right strategy. Companies also need the right culture. For GM to succeed and gain back the trust of its customers, it needs to truly learn from its past mistakes and apply that learning in a culture that rewards risk-taking and truth-telling.
