Ed Whitacre's Postcard From The Auto Bailout

Ed Whitacre freely admits "I knew nothing about cars. Zero." Which made the out-of-the-blue phonecall from Steven Rattner all the more strange. But he does know management, and that's why Team Auto reached out, because General Motors management was all kinds of bad, and that needed to change now that taxpayer money was at stake.

In his memoir American Turnaround, Ed Whitacre gives his side of the reinvigoration of General Motors. It's another slice in the ongoing dissection of What Just Happened in the American auto business, and Whitacre sets up the story by asking, "How could I even consider taking the reins of a company whose business I knew nothing about?"

The book is written like a chat with Ed Whitacre himself; the words on the page almost twanging. The plain, direct language make the 271 pages of American Turnaround go quickly. The book was released February 12th, and as with any memoir, be sure to pick up a few grains of salt or look into some other perspectives so you can form your own opinions about the history that's now being written down.

There will be critics who write off American Turnaround as a vanity piece written by a typical big-business type adept at tooting his own horn. A memoir by its very nature is going to be filled with a lot of I, Me, Mine, and the inherent inertia in the car business will see Whitacre accused of trying to take credit for things set in motion by the leadership he kicked out. The criticisms might be missing the point, or worse, misinterpreting. Whitacre didn't swashbuckle in like, say, Bob Lutz, brimming with ideas about product development. Instead, he came in and looked at the way the business of GM was run, and according to his account, it wasn't firing on all cylinders. That seems to square with other reports, regardless of what you believe caused it.
For a better understanding of the man and his motivations, Whitacre spends time giving background on his childhood and work history and how his experiences at Southwestern Bell, SBC and AT&T shaped his management philosophy and practices. A couple of points are continually hammered home throughout the text. One of Whitacre's core beliefs is that management is responsible for the success and failure of a company, and another is that people are the number one asset of any business.

It became clearer and clearer that there was no sense among top managers that anything was in need of fixing.

"To hear GM management talk," Whitacre says, the collapse wasn't their fault." But peering through the murky layers of General Motors structure, it became clearer and clearer that there was no sense among top managers that anything was in need of fixing. This outsider's account of putting sunlight onto GM's jaundiced inner workings suggests that GM succeeded, and ultimately failed, both in spite of, and because of, itself.

Perhaps you could argue that American Turnaround is an exercise in back-patting self-aggrandizement, but Whitacre's 40-plus years in telecom surely afforded him a comfortable retirement and a pretty healthy sense of accomplishment, to the point where there's no need to puff out his chest and feed his ego.

The deeper point is that management at GM, the car guys, are the ones who rode this thing into the ground.

It may seem counterintuitive to criticize, and ultimately replace, the CEO of a car company for being a car guy, but that's what happened at GM with Whitacre as Chairman of the Board. The deeper point that's made more clearly is that management at General Motors, the car guys, are the ones who rode this thing into the ground with a complicated structure where nobody was clearly in charge, endless Powerpoint obfuscation and a plodding march to the beat of "it's always been done this way."

It's not a screed, but Whitacre doesn't shy away from indicting business-as-usual operators like Rick Wagoner and Fritz Henderson, and there's even a page and a half about Bob Lutz, everyone's favorite executive quote machine. The easy-reading tone and personal background helps readers come away with a friendly impression of Ed Whitacre, and that's likely by design. Nobody wants to write a personal account of what a jerk they are. Sure, there are going to be points of contention, but a memoir is not supposed to be a balanced and exhaustively researched volume. The conversations here are paraphrased from memory, leaving the door wide open to debate.

Whitacre's assertion that he doesn't know anything about cars comes through in the instances he does write about vehicles.

American Turnaround is an easy, interesting read that isn't really about cars. Whitacre's assertion that he doesn't know anything about cars comes through in the instances he does write about vehicles, and you get the sense that he was content to leave the car stuff to the car people while he concentrated on the top levels of GM. In the end, though, not being a car guy while running a car company doesn't seem to be such a bad thing if you're trying to push decisions and a sense of ownership down to every employee, instead of being coccooned on the 39th floor of the Renaissance Center. Give the car guys the power to make great cars, and support them with an effectively run business seems to be the mantra preached here. Of course, if you're both a good leader of a global car business and a car guy, so much the better.

If you want to read about chrome and horsepower, you might find Bob Lutz's Car Guys vs. Beancounters more intriguing, and Once Upon a Car by Bill Vlasic is a well-rounded chronicle of the entire bailout situation, while the Washington side of the story is told by Steven Rattner in Overhaul. But if business management intrigues you at all, American Turnaround is instructive and fascinating and definitely worth reading.


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    • 1 Second Ago
  • 22 Comments
      dukeisduke
      • 1 Year Ago
      If he was such a great CEO, he wouldn't have bailed on GM, and left them stuck with Dan "Captain Queeg" Akerson.
        IBx27
        • 1 Year Ago
        @dukeisduke
        He didn't bail, the owners of gm kicked him out, and by 'owners' that means obummer.
          hgknews
          • 1 Month Ago
          @IBx27

          Obviously dukeis doesn't like black people.  Logic and common sense?  What the hell is that?

      Polly Prissy Pants
      • 1 Year Ago
      "There will be critics who write off American Turnaround as a vanity piece written by a typical big-business type adept at tooting his own horn" Apt description right there. It's amazing how getting dealt all aces one time can convince everyone that you're an expert at poker.
        hgknews
        • 1 Month Ago
        @Polly Prissy Pants

        Prissy, the man ran AT&T for 40 years.  If you know that you probably know he  lost some hands.  They should have kicked him out. 

      Moosetang
      • 1 Year Ago
      I'm not sold on Ed's tenure affecting much positive change, I think he left with the job mostly not done, but he's right about old-school car guys being in trouble if not kept in balance. Sure, as enthusiast we love to grumble at the bean counters and hail the guys with hot rodding in their blood. But to run a multi-billion-dollar car company successfully in today's market means you have to have good business sense, have to be a good manager, and have to be willing to go where the Market's going even if that's place you don't personally want to go. Said another way: Alan Mulally, not a car guy. Seems to be doing quite well from where I'm sitting.
      Randy
      • 1 Year Ago
      Sorry but Mullaly is far better.
      comrade slow
      • 1 Year Ago
      American turnaround my A$$. given my personal experiences with AT&T as a telephone, cellular, and internet service provider over the years, which is best described as a series of train wrecks... every single time... and GM's lackluster recovery efforts despite a fat taxpayer bailout, I can't imagine getting any value out of reading anything he has to say
        hgknews
        • 1 Month Ago
        @comrade slow

        Comrade, I am just a customer of ATT and I could tell you some sorry tales, but I think you should look in the mirror. I have a few friends who work for ATT.  One had a sick kid and only complimented his health coverage and the others never complained about a late paycheck, And . . . .  I am also a stockholder.  If you had bought $1000.00 of stock in ATT when he took over . . . . . for sure you would recommend reading his book.

      Durishin
      • 1 Year Ago
      How we now do business in America, comrade? Supreme government buys company with people's money. Company now belong to "people." Apparatchiks get rich! You have another question?
      • 1 Year Ago
      [blocked]
        Avinash Machado
        • 1 Year Ago
        You seem obsessed with RWD Chevy's and Ford's.
          • 1 Year Ago
          @Avinash Machado
          [blocked]
          riserburn99andre
          • 1 Year Ago
          @Avinash Machado
          The man wasn\'t in charge of GM for a longtime so he couldn\'t have had a chance to implement any vehicles. He was in the middle of restructuring the management and the corporate culture within GM so idk if he COULD have done anything in the short period he was in there. Especially considering he isn\'t a car guy.
      IBx27
      • 1 Year Ago
      Whitacre did an awesome job with GM, and brought them back to a path of success. Then, the feds kicked him out and replaced him with akerson, who is running GM just like it was in the Rick Wagoner days.
        whofan
        • 1 Year Ago
        @IBx27
        GM was ruined before Rick Wagoner stepped in. I think Wagoner would have turned GM around if givin time but there debt was just too big. Looking at what GM has comming out of the pipe they are again on the road to ruin.
        hgknews
        • 1 Month Ago
        @IBx27

        IBx27, you are right he did indeed do that..  But when he took over he said he would only stay until they were ready to go public.  And guess what, how original, he did what he said he would do.. 

      RGT881
      • 1 Year Ago
      Know nothing about cars? Okay, but stop promoting your legacy to shamelessly. I'm 30 and I will include YOU in my memoirs! lol
        hgknews
        • 1 Month Ago
        @RGT881

        RTG881, 30 years old.  If you could just read a book and be successful, everybody could be successful.  But you're lucky, this book is the exception.  This one will do it if you boil it down to one line.  "Just use common sense!"

      Steve Smlth
      • 1 Year Ago
      Ed Whitacre was widely described as the "most hated CEO" (by his employees) in America, dating from his tenure at ATT. He seems to have done nothing to burnish his rep @ General Motors.
        hgknews
        • 1 Month Ago
        @Steve Smlth

        Steve Smith, I guess this is accurate, if you say so.

      • 1 Year Ago
      [blocked]
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