Building "a sustainable culture of customer focus and product excellence"
Excellent article on product development by former GM, Chrysler, BMW and Ford executive Bob Lutz.
Lutz argues the best short-term manager is an omniscient autocrat, like Steve Jobs or former Volkswagen CEO Ferdinand Piëch:
Astonishingly, in this critical area of product creation, where the future of the car company hangs in the balance, the much-scorned autocratic style of management works well, and numerous success stories confirm it. The big proviso, of course, is that the autocrat must be so steeped in the car business, and have so much taste, skill, intuition, and sense for the customer, as to be nearly infallible. (I shall eschew discussion of the less-than-knowledgeable autocrat, who delves into things he or she knows little about and demands that it be done this or that way. It is a near-infallible recipe for disaster.)
But, Lutz continues, dictatorial management is a lousy long-term strategy because it’s unsustainable:
I often ask myself if the company could have achieved the turnaround in product excellence faster if I had been less patient and more brutal in my approach.
One of the things I found I had to do was teach the basics of what constitutes a beautiful interior, beautiful paint and superb fits of outside sheet metal. Friday after Friday, I was in one engineering shop or another, surrounded by midlevel engineers, designers and manufacturing execs, going over a future model in tiny detail, showing everyone how the same part looked on an Audi or Lexus (we always had one of each for comparison), then asking why we couldn’t execute it like that, and listening to more or less valid answers.
I had to ask myself, and still do today, if it is the proper role of a vice chairman of a company with annual revenue of $200 billion to get down in the trenches for hours on end, teaching the love of perfection in the smallest details when perhaps a more impatient autocrat would simply have ordered—nay, demanded—that it happen, laying down a deadline and then firing masses of people if the deadline came and the results weren’t there.
The fact is, though, that my effort to instill into the organization a drive for perfection and customer delight in all things was successful. And still I wonder—was I right? Did I change the core of the product development culture by teaching, or did I rely too much on my own will and my considerable influence to get what I wanted?
If the latter, excellence will soon be lost again, and talk of “how much we can cut before the customers start complaining” will rear its ugly head again. It will be death by a thousand small cuts, because anytime the company loses the focus of providing the very best it can, delighting the eye, ear, butt and wallet of the customer more than the competitors do, the inevitable decline sets in.
Posted by James on Sunday, June 12, 2011